The civil securities fraud case has started of Fabrice Tourre – the man who wanted to be known on Wall Street as ‘Fabulous Fab.
His is the highest-profile trial so far from financial authorities investigations of the events before the 2008 crisis.
The US Securities and Exchange Commission, which has brought the case said it highlights what went wrong on Wall Street in the financial crisis.
The former Goldman Sachs bond trader has denied any wrongdoing in selling mortgage related investments when he knew that other investors were betting against them.
The evidence against him includes an email he sent to his then girlfriend in early 2007 saying the “whole building is about to collapse anytime now”.
The email went on: “Only potential survivor, the fabulous Fab … standing in the middle of all these complex, highly leveraged, exotic trades he created without necessarily understanding all of the implications of those monstrosities!!!”
The trial began with jury selection and the judge appealing to lawyers from both sides to “be gentle” with the jurors who will be bombarded with hugely complicated technical trading terms.
Goldman Sachs – which paid 550 million dollars to settle its part of the lawsuit – is underwriting Tourre’s defence.
He is accused of fraud, negligence and aiding and abetting Goldman Sachs in violating securities laws.