Blankfein Is About To Get A Subpoena Over Goldman’s Mortgage Business

blankfein headache

[credit provider=”Bloomberg Businessweek”]

Goldman’s top executives will probably get subpoenas from federal prosecutors over their mortgage unit in the next few days, the WSJ reports.Sen. Carl Levin said he had referred his committee’s findings on the financial crisis to the DOJ, so the existence — or imminent existence — of the document requests would have been expected for a while now by Blankfein and co.

The senate subcommitee’s two-year analysis of what led to the implosion of the financial system, “train[ed] much of its ire on Goldman Sachs, which Sen. Levin said deceived some clients by betting against home loans in 2006 and 2007, while simultaneously selling mortgage securities.”

But most agree that it’s unlikely that a subpoena will result in criminal charges.

One analyst told the WSJ, “U.S. prosecutors are unlikely to bring criminal charges against Goldman because they probably already have seen much of the information amassed by the SEC during its civil investigation.”

That was echoed this morning by Ben White of Politico, who said he’d “put the odds of criminal prosecution at a very low level but anything could happen if fresh documents or surprising witness statements materialise.”

As a sidenote, this is what the Morning Money writer had to say about how the story ended up with the Journal:

Last night, the WSJ moved a story saying Goldman executives “expect to receive subpoenas” from the DOJ concerning its mortgage business. The report cites “officials at the company.” It’s about as clear a preemptory leak as you will find.

Whatever the case, rather than let Justice (or Hill staff) leak the document requests and create a bigger media frenzy, Goldman tossed the story to the Journal. The impact is now muted because no one wants to follow the Journal and when the subpoenas show up it will be a non-story.

Matt Taibbi, meanwhile, is praying that his dreams of a Goldman indictment come true.

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