As this past week wore on and comments and observations from attorneys and analysts were weighed, it became increasingly evident that the SEC's civil fraud case against Goldman Sachs, announced one short week ago on April 16, was founded on slim evidence and had little chance of succeeding in court, even though it had a high-pitched emotional resonance. Mario Bartiromo found it wanting. Republicans charged that the suit was politically motivated, timed to correspond to debate over financial reform. The SEC itself decided to investigate ("UPDATE 1-Watchdog to probe SEC's Goldman lawsuit" http://www.reuters.com/article/idUSN2323274820100423?type=marketsNews).
But most damning is that Warren Buffett expressed his confidence in Goldman.
"Warren Buffett Has 'Great Confidence' in Goldman Sachs Says Berkshire Director"
http://www.cnbc.com/id/36742080
Looking at the charges and the assumptions behind them, you could make a strong case that the only way for Goldman Sachs to avoid being charged was that Goldman would have had to prove to its client in advance that Goldman would lose money on the deal.
Although the ACA portion of the suit is in tatters after a week's worth of reports, the IKB side of the argument will survive, reports the Washington Post.
"SEC confident on IKB part of Goldman Sachs lawsuit" http://www.washingtonpost.com/wp-dyn/content/article/2010/04/23/AR2010042305223.html
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