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SEC Slaps Goldman Sachs With $6 Million Fine for Reporting Failures

2 mins
Updated by Michael Washburn
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In Brief

  • The Securities and Exchange Commission (SEC) has levied a $6 million fine against Goldman Sachs.
  • The fine is ostensibly a penalty for not making all required disclosures about daily trading activities.
  • But Goldman Sachs may have stoked the regulator's ire with its bold foray into the crypto markets.
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The Securities and Exchange Commission (SEC) continues to fault firms of all sizes and profiles for not being as forthcoming as the regulator deems appropriate, and its latest target is none other than Goldman Sachs.

The agency has reached a settlement with the investment bank. Goldman Sachs will pay $6 million as a penalty for not providing all required trading information over the course of a decade.

The SEC Demands Disclosures From Goldman Sachs

According to an SEC statement, Goldman’s submissions of securities trading information, known as “blue sheet data,” fell far short of providing all the necessary trading data.

Over ten years, Goldman made no fewer than 22,000 faulty blue sheet submissions, the regulator states. The SEC found 43 kinds of omissions or other errors on the blue sheets. Hence, in total, submissions for 163 million transactions fell short of the proper, legally required disclosures.

Moreover, the SEC charges, Goldman did not have adequate internal reviewing processes in place. So it could not verify it was submitting full and correct information.

The investment bank does not challenge the SEC’s claims. It has agreed to accept censure and the large penalty.

Goldman Sachs’s Crypto Connection

Why is Goldman in the SEC’s crosshairs? The regulator appears to resent any financial institution that shows too much autonomy. It expects banks and companies to agree with SEC Chair Gary Gensler. To share his aversion to a field he has called “rife with fraud, rife with hucksters.”

But Goldman, in recent months, has given positive signals about cryptocurrency. The very asset class for which the SEC’s current chair has publicly expressed loathing.

In a CNBC interview in February, Mathew McDermott, Goldman’s global head of digital assets, acknowledged that the firm has a crypto trading desk.

He envisioned a greater role for crypto. And he praised tokenization and the transformative effect that digital currencies have on the financial markets.

McDermott described “excitement” at “seeing how this technology can impact many different parts of the financial system and have a real commercial impact.”

Learn more about the long-running tensions between SEC Chair Gary Gensler and the crypto industry.

Goldman Sachs maintains a crypto trading desk, and envisions deeper involvement in the digital asset market . Source: TradingView

Goldman Sachs Digital Asset Head Makes Bold Prediction

Will more firms and banks adopt crypto? These are still early days, but McDermott has no doubt which way the wind is blowing.

“We’re at such an early stage in terms of its adoption, but as you look across the marketplace and you see the breadth of financial institutions building out their digital asset teams, their digital asset strategies, be that the sell side or the buy side, it’s just super exciting,” he said.

Gary Gensler’s SEC may have felt a sting of provocation at reading such comments. An even more explicit endorsement of crypto comes directly from the horse’s mouth.

On its website, Goldman states, “Blockchain has the potential to change the way we buy and sell, interact with government and verify the authenticity of everything from property titles to organic vegetables.”

“It combines the openness of the internet with the security of cryptography to give everyone a faster, safer way to verify key information and establish trust.”

Top crypto platforms in the US | February 2024



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Michael Washburn
Michael Washburn is a New York-based managing editor who joined BeInCrypto in March 2023. Over his career, he written extensively about the corporate legal world and the intersection of finance and law, has produced thousands of articles and features, and has mentored many reporters and researchers finding their way in a fast-changing industry.