Lloyd Blankfein, chief executive, and other senior executives at Goldman Sachs have hired high-powered criminal defence attorneys to represent them in government investigations into possible wrongdoing at the investment bank, it emerged last night.
Mr Blankfein is being advised by Reid Weingarten, a white-collar crime defender at Steptoe & Johnson, whose previous clients include notorious fraudsters Bernie Ebbers, chief executive of the bankrupt telecoms firm WorldCom, and Richard Causey, accounting officer at the collapse energy giant Enron.
The revelation sent shares in Goldman Sachs tumbling around 4 per cent in the final minutes of trading in New York yesterday, as investors who had believed the company's legal woes were largely behind it reassessed that view.
Last year, Goldman paid a $550m fine to settle civil charges that it misled investors in one sub-prime mortgage investment vehicle, but the Department of Justice was asked earlier this year to examine additional evidence in a Congressional report into the investment bank's trading operations. Mr Blankfein was accused at the time of painting a misleading picture in testimony he gave under oath.