2012-09-08 — seattlepi.com
``Wall Street banks sold the pooled securities, known as collateralized debt obligations, at the height of the housing boom. CDOs combine slices of debt with varying levels of risk. As U.S. homeowners started falling behind on their mortgages and defaulted in droves in 2007, buyers of CDOs lost billions.
Goldman Sachs agreed to pay $550 million in July 2010 to settle similar charges with the SEC. The Wall Street powerhouse was accused of misleading investors by failing to tell them the mortgage securities had been chosen with help from a Goldman hedge fund client that was betting the investments would fail.''
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