Lloyd Blankfein, chief executive of Goldman Sachs, has hired Reid Weingarten, a prominent Washington D.C., criminal defence lawyer as the U.S. Department of Justice investigations into Goldman and its role in the financial crisis continue. Mr. Weingarten, is a partner with Steptoe & Johnson LLP, he has represented a wide array of high-profile clients in criminal cases. They include former WorldCom Inc chief Bernard Ebbers, former Enron accounting officer Richard Causey, and film director Roman Polanski.
The Senate’s Permanent Subcommittee on Investigations (PSI) in April released a scathing report that criticized Goldman Sachs for “exploiting” clients by unloading subprime loan exposure onto unsuspecting clients in 2006 and 2007, and concluded that its top executives misled Congress during testimony in 2010.
In a statement on Monday, Goldman Sachs confirmed that Blankfein and other executives had hired outside lawyers to advise them: “As is common in such situations, Mr. Blankfein and other individuals who were expected to be interviewed in connection with the Justice Department’s inquiry into certain matters raised in the [Permanent Subcommittee on Investigations] report hired counsel at the outset.”
The Wall Street Journal reports that though his bank faces investigations and subpoenas on federal, state and local levels, “it isn’t clear precisely why Mr. Blankfein hired a lawyer who focuses his practice on white-collar criminal defense.”
Goldman paid $550 million in July 2010 to settle a lawsuit filed by the Securities and Exchange Commission that accused the firm of creating and selling mortgage securities investment that were designed to fail.
The New York Times reports that shares of Goldman fell nearly 5 percent after Reuters reported the news about Weingarten.