Goldman Sachs Group Inc. agreed to pay $15 million to settle allegations that its securities lending violated federal regulations, the Securities and Exchange Commission said Thursday. Specifically, the SEC accused the broker-dealer of failing to adequately secure the stock needed to administer a short-selling trade. In a short sale, investors borrow stock and hope to repay it at a lower price, thus profiting if the stock...
The US securities and Exchange Commission ( SEC ) announced yesterday that securities Sachs is to borrow $ 15 m to settle civil charges that its securities lending practices violated federal law . The bank had made improper representations to customers who requested that the firm borrow certain stocks for short sale ; Goldman had told customers that it had arranged to borrow , or believed it could borrow , the security to settle the short sale , known as " granting loans " . However , the SEC has said that the bank had not performed an adequate review of the securities customers had asked it to locate .