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		<title>Fabrice Tourre reasons out: &#8220;I Did Not Mislead Investors&#8221;</title>
		<link>http://www.fgnpr.com/3277/fabrice-tourre-reasons-out-i-did-not-mislead-investors</link>
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		<pubDate>Tue, 27 Apr 2010 17:52:18 +0000</pubDate>
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		<description><![CDATA[
The London-based Goldman Sachs banker Fabrice Tourre, who is at the centre of a $1bn (£650m) fraud prosecution, came out fighting today with a vigorous rebuttal of &#8220;unfounded attacks&#8221; on his character and motives.
&#8220;I deny&#8211;categorically&#8211;the SEC&#8217;s allegation,&#8221; Tourre said. &#8220;And I will defend myself in court against this false claim.&#8221; 
For Tourre, 31, Tuesday&#8217;s appearance [...]]]></description>
			<content:encoded><![CDATA[<p><a href="http://www.fgnpr.com/wp-content/uploads/2010/04/Fabrice-Tourre.jpg"><img src="http://www.fgnpr.com/wp-content/uploads/2010/04/Fabrice-Tourre-150x150.jpg" alt="" title="Fabrice Tourre" width="150" height="150" class="alignleft size-thumbnail wp-image-3278" /></a></p>
<p>The London-based <a href="http://www2.goldmansachs.com/">Goldman Sachs</a> banker Fabrice Tourre, who is at the centre of a $1bn (£650m) fraud prosecution, came out fighting today with a vigorous rebuttal of &#8220;unfounded attacks&#8221; on his character and motives.</p>
<p>&#8220;I deny&#8211;categorically&#8211;the SEC&#8217;s allegation,&#8221; Tourre said. &#8220;And I will defend myself in court against this false claim.&#8221; </p>
<p>For Tourre, 31, Tuesday&#8217;s appearance before the <a href="http://levin.senate.gov/senate/investigations/index.html">Senate Permanent Subcommittee on Investigations</a> represented his first public appearance to personally answer the charges against him. Since the SEC unveiled its civil suit against Goldman Sachs, Tourre has been heavily scrutinized, thanks to emails released by the SEC and later, Goldman.</p>
<p>In a brash January 2007 e-mail released by the SEC, Tourre called himself &#8220;The fabulous Fab &#8230; standing in the middle of all these complex &#8230; exotic trades he created without necessarily understanding all of the implications of those monstrosities!!!&#8221; </p>
<p>Tourre, who appeared calm during the appearance, testified that he does not recall telling investors that a Goldman hedge fund client was betting against an investment that soured. The hedge fund, Paulson &#038; Co., profited handsomely from the deal.</p>
<p>Tourre said the other investors in the deal, ACA Management LLC and German bank IKB, were &#8220;sophisticated&#8221; and were ultimately responsible for the outcome of their investments.</p>
<p>In written evidence released ahead of an appearance before a Senate committee in Washington, the Frenchman &#8220;categorically&#8221; denied accusations by the <a href="http://en.wikipedia.org/wiki/U.S._Securities_and_Exchange_Commission">Securities and Exchange Commission</a> that he misled clients over a 2007 mortgage-backed security named Abacus AC-1 which, he insisted, was not structured to fail.</p>
<p>The investment in question was a collateralized debt obligation backed by subprime mortgage securities. ACA was chosen to select the mortgages that made up the security, but had input from Paulson.</p>
<p>Tourre said that while Paulson made suggestions as to the mortgage securities, ACA had &#8220;sole authority to decide what securities would be referenced in the transactions&#8221; </p>
<p>&#8220;So, while Paulson, Goldman Sachs and IKB all had input into the reference portfolio … ACA ultimately analyzed and approved every security in the deal. Thus, when Goldman Sachs represented to investors that ACA selected the referenced securities, that statement was absolutely correct,&#8221; Tourre said.</p>
<p>In e-mails released by Goldman Sachs over the weekend, Tourre appeared slightly more conflicted about his role emails to his girlfriend, Marine Serres, though his tone was often joking. </p>
<p>&#8220;Anyway, not feeling too guilty about this, the real purpose of my job is to make capital markets more efficient and ultimately provide the U.S. consumer with more efficient ways to leverage and finance himself, so there is a humble, noble and ethical reason for my job <img src='http://www.fgnpr.com/wp-includes/images/smilies/icon_wink.gif' alt=';)' class='wp-smiley' />  amazing how good I am in convincing myself !!!&#8221;</p>
<p>He made no mention of a series of emails to his girlfriend, made public over the weekend, in which he appeared to demean his own work as &#8220;intellectual masturbation&#8221; and as &#8220;Frankenstein&#8221; financial products.</p>
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