27 November 2015

Goldman Sachs fined $1.5m over supervision failures

10 December 2012  |  6696 views  |  0 Goldman Sachs logo web screen shot

Goldman Sachs has been fined $1.5 million by US regulators for failing to supervise a trader who bypassed internal systems to conceal an $8.3 billion position from the bank and defraud it of $118 million.

According to the Commodity Futures Trading Commission (CFTC), in late 2007 Matthew Marshall Taylor, while trading a firm account, entered fake e-mini futures trades into the bank's manual trade entry system to conceal and misrepresent the size of his true position.

Taylor is accused of entering the fabricated trades by bypassing internal system designed for entering and routing electronically to the CME, instead manually putting them in a different internal system that routed only to the firm's books and records, not to the exchange.

The watchdog filed charges against Taylor in Manhattan federal court in November, saying he defrauded the bank, which ended up losing $118.44 million.

Now Goldman has been fined for failing to ensure "risk management, compliance, and supervision programs comported with its obligations to supervise diligently its business as a Commission registrant".

The $1.5 million figure has been criticised by one CFTC commissioner, Bart Chilton, who says that "penalties should be calculated so that they are more than a 'slap on the wrist'".

Comments: (0)

Comment on this story (membership required)
Log in to receive notifications when someone posts a comment

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board, sign up now.

Related blogs

Create a blog about this story (membership required)

Related stories

09 November, 2012
11 October, 2012
10 August, 2012

Related company news


Related company information

Goldman Sachs

Top topics

Most viewed Most shared
MIT to run fintech degree course
9371 views comments | 36 tweets | 14 linkedin
Coinbase issues Bitcoin debit card
8304 views comments | 18 tweets | 21 linkedin
BBVA buys 29.5% stake in Atom for £45...
7601 views comments | 34 tweets | 41 linkedin
BNP Paribas to test contactless payment di...
5924 views comments | 17 tweets | 25 linkedin
UK banks propose merger of five trade asso...
5323 views comments | 7 tweets | 9 linkedin

Featured job

Competitive base, double OTE
London, UK

Find your next job