Goldman Sachs has agreed to pay $550 million to settle civil fraud charges that accused the firm of misleading buyers of mortgage-related investments.
The settlement calls for Goldman Sachs to pay the SEC fines of $300 million. The rest of the money will go to compensate those who lost money on the mortgage-related investments.
The investments at the center of the charges were structured with input from a Goldman client who was betting on them to fail. The securities cost investors close to $1 billion while helping Goldman client Paulson & Co. capitalize on the housing bust.