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Justice Department will not seek fraud case against Sachs

By Mae Anderson and Rob Harris

Associated Press

Published: Thursday, Aug. 9 2012 9:40 p.m. MDT

WASHINGTON — The Justice Department said Thursday it won't prosecute Goldman Sachs or its employees in a financial fraud probe.

In a written statement, the department said it conducted an exhaustive investigation of allegations brought to light by a Senate panel investigating the 2008-2009 financial crisis.

But the department added that if additional or new evidence were to emerge, it could reach a different conclusion about prosecuting Goldman.

A Senate subcommittee in April 2011 found that Goldman marketed four sets of complex mortgage securities to banks and other investors, but that the firm failed to tell clients that the securities were very risky. The Senate panel said Goldman secretly bet against the investors' positions and deceived the investors about its own positions to shift risk from its balance sheet to theirs.

— Associated Press

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