Warren Buffett voices support for Goldman Sachs

5 May 2010

Warren Buffett, a billionaire investor, has voiced his support for investment bank Goldman Sachs in the wake of the recent fraud allegations levelled by the Securities and Exchange Commission (SEC).

The regulator filed a charge of fraud against the financial institution and vice-president Fabrice Tourre, which accused the bank and its employee of deliberately omitting information from investment products linked to subprime mortgages.

Mr Buffet, chief executive of Berkshire Hathaway, said that he did not “hold it against Goldman Sachs that they are subject of [SEC] allegations”.

He was quoted by the Financial Times as saying: “There is no question that the allegation alone causes the company to lose reputation … the last few weeks hurt the company and morale ... it is not remotely mortal but it hurts.”

However, Mr Buffet added that after having studied details of the supposedly illegal transaction, he did not believe that Goldman Sachs had committed fraud.

Berkshire Hathaway is thought to own $5 billion worth of shares in Goldman Sachs.

Meanwhile, Goldman Sachs has revealed that its shareholders have filed a number of law suits against the financial institution accusing it of mismanagement.

By Jim Ottewill

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