Germany And Britain Now Go After Goldman Sachs

Bloomberg reports today that both Germany and Britain are going after Goldman Sachs, both countries calling for a probe of Goldman Sachs.

"U.K. Prime Minister Gordon Brown said he wants the Financial Services Authority to open an inquiry, declaring he was “shocked” at the “moral bankruptcy” indicated in the suit. The German financial regulator, Bafin, asked the SEC for details on the suit, a spokesman for Chancellor Merkel said.

In particular, Brown says that this is probably one of the worst cases we’ve seen. “It looks as if people were misled about what happened. The banks are still an issue. They are a risk to the economy.”

"The investigations widen the threat to the New York-based bank, which on April 16 denied wrongdoing. The U.S. regulator accused Goldman Sachs of fraud tied to collateralized debt obligations that contributed to the financial crisis.

“We will see politicians throughout the world piling on Goldman Sachs,” said Scott Moeller, a former investment banker now teaching at Cass Business School in London. “Now they have vulnerability. Everyone and anyone, especially politicians, are going to be trying to make hay with this one.”