Thursday, April 19, 2012

Goldman, Sachs & Co. Charged for Lacking Adequate Policies and Procedures for Research “Huddles”

Huddles were a practice where Goldman’s stock research analysts met to provide their best trading ideas to firm traders and later passed them on to a select group of top clients. The firm has been charged by the SEC for lacking the adequate policies and procedures to address risk. The risk was that analysts could share material, nonpublic information about upcoming changes to their published research with clients and the traders.

Goldman agreed to settle the charges and will pay a $22 million penalty. Goldman also agreed to be censured and take steps to correct the deficiencies identified by the SEC. FINRA also announced today a settlement with Goldman for supervisory and other failures related to the huddles.

SEC Charges Goldman, Sachs & Co. Lacked Adequate Policies and Procedures for Research “Huddles”
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