Ex-Goldman VP Tourre seeks to toss fraud verdict in SEC case
NEW YORK Oct 1 (Reuters) - A former Goldman Sachs Group Inc vice president who was found liable for securities fraud over a failed mortgage transaction has asked a federal judge to throw out the U.S. Securities and Exchange Commission's case against him or else set a new trial.
Fabrice Tourre said his jury erred in finding him liable on six of the seven civil charges he faced, saying the evidence did not support the verdict or was never presented to his jury.
Letting the verdict stand "would work a manifest injustice to Mr. Tourre," his lawyers wrote in a Monday night filing in the U.S. District Court in Manhattan.
The SEC did not immediately respond on Tuesday to requests for a comment.
The Aug. 1 verdict was the SEC's first major courtroom victory in a case stemming from the recent financial crisis.
Jurors found Tourre liable for misleading investors in the 2007 synthetic collateralized debt obligation Abacus 2007-AC1, by failing to reveal that hedge fund billionaire John Paulson helped choose the underlying securities and was betting that they would fail.
He was also held responsible for having misled ACA Capital Holdings Inc, which also chose assets for Abacus, into believing Paulson's firm would be an equity investor in the CDO.
Investors lost about $1 billion in the CDO, the SEC has said. Goldman agreed in a July 2010 settlement with the regulator to pay $550 million, without admitting wrongdoing.
In his filing, Tourre said the charges on which he was held liable for scheming to defraud ACA should be dismissed because they were premised on misstatements underlying the charge on which he was held not liable.
He also said there was no evidence he received money or property by making an untrue statement, or that Abacus was a "domestic" transaction to justify liability under U.S. securities laws.
In addition, he said trial Judge Katherine Forrest made a mistake in not letting jurors consider whether swap agreements entered into by Goldman, ACA and the former ABN Amro were "security-based" swaps that could subject him to liability.
Goldman has been paying legal bills of Tourre, who is now pursuing a doctorate in economics at the University of Chicago.
The case is SEC v. Tourre, U.S. District Court, Southern District of New York, No. 10-03229.
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