fabrice tourre wiki

fabrice tourre wiki

Take note from the sheep: being a sacrificial lamb may, in the end, pay off. I’ve been there, done that, don’t argue!

You all know who Fabrice Tourre is – at least now you do. Young, the “Fabulous Fab” – he is the guy who allegedly maximized the greatest economic disaster the world has ever known. At the time, he was only 27, and somehow he convinced Goldman Sachs’ clients to buy into a securities deal called Abacus 2007-AC1. Altogether, they lost $1 billion in what the US Securities and Exchange Commission say “was a scam in which Goldman Sachs capitalized on an impending economic disaster that nearly triggered a global depression.”

So I read the news today, and all the articles that crucify this poor young man, and somehow, the whole deal reminded me of a 2002 Hollywood production called Changing Lanes. I will not go into the details of the plot, this sheep doesn’t spoil the fun for anyone. It’s up to you to rent it and see what I mean. Pay close attention to the scene where Banek’s father-in-law is blackmailing him to keep quiet about a forged legal document.

Now think about something larger than life. 31 years old? A nobody before the incident, someone who has just finished a school and was hired on the spot by the world’s most powerful financial institution, to become a vice president shortly after? Come on! Let’s think about it: Fabrice Tourre, French, born in 1979 (as we learn from Fabrice Tourre’s Wikipedia page), graduates in 2000 from the Central School of Paris, moves to New York and one year later he gets a master at Stanford, and immediately he is hired by Goldman Sachs. He was only 22 at the time. Shortly after, the young graduate gets to be a vice president.

He was only 27 when Goldman Sachs was approached by a hedge fund maverick raised in Queens named John Paulson (who is now is #45 on the list of the world’s wealthiest billionaires). This is when Abacus 2007-AC1 was born, and the reason for this strategic move did not come from Tourre’s little brain as you might expect. You have the real drill in the New York Times if you care to dig deeper. According to the New York Times, top Goldman executives, “decided in December 2006 to change the firm’s overall stance on the mortgage market, from positive to negative, though it did not disclose that publicly. Even before then, however, pockets of the investment bank had also started using C.D.O.’s to place bets against mortgage securities, in some cases to hedge the firm’s mortgage investments, as protection against a fall in housing prices and an increase in defaults. Mr. Egol was a prime mover behind these securities.”

So you got yourself a name: Jonathan M. Egol. Of course, the newbie Tourre would do everything he was asked to, after all, who gets a job at Goldman Sachs at 22 just because? Naturally, Tourre worked closely with Egol in making and marketing the Abacus securities. The question is, why all of a sudden he is sole responsible for the Abacus 2007-AC1? Because, isn’t it, Goldman Sachs needed the proverbial sacrifice lamb – or at least, this is what this sheep believes. Oh, but I am not the only “baa” in the crowd:

“Fabrice Tourre will be placed on administrative leave or fired (a.k.a., thrown under the bus). He will then spend the next couple of years testifying in this and other follow-on civil lawsuits. The SEC will probably demand a cash settlement from him, too, and boot him out of the industry,” the Business Insider writes.

Don’t believe the sheep, believe the experts! Sheepy out!

You all know that Fabrizio Tourre - at least now you. Young, Fabulous Fab - he is the type that provides maximum greatest economic disaster in history .. While

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You all know that Fabrice Tourre is -- at least now you do. Young, Fabulous Fab "- he is the type that would maximize the greatest economic disaster the world has ever known .. At that time, was 27 years old, and somehow persuaded customers to buy Goldman Sachs in a transaction values "Abacus 2007-AC1.


Soon after, the young is to be a vice president. 31 years? Person before the accident, someone who just finished college and was hired on the spot by the most powerful financial institution in the world, to become vice president, shortly after? Come think of it: Fabrice Tourre, French, born in 1979 (as we know from the Wikipedia page on Fabrice Tourre) who graduated in 2000 at the Ecole Centrale de Paris, he moved to New York and a year later obtained his Masters Stanford University, and was immediately hired by Goldman Sachs. Now think of something bigger than life. .

Fabrice Tourre is a Vice President for the investment banking and securities firm Goldman Sachs. On April 16, 2010, Tourre was charged by the US Securities and Exchange Commission (SEC) with securities fraud. The charges relate to a series of e-mails sent by Tourre in 2007 in which he warned of the forthcoming subprime mortgage crisis and the potential "collapse" of Goldman Sachs.5



The charges amount to a civil lawsuit against Tourre and Goldman Sachs. The Justice Department declined to issue a criminal complaint in the matter.6
Abacus Deals
Tourre, a French citizen who had graduated from Stanford University, started working for Goldman Sachs in 2001. He is considered an integral figure in the development of so-called "Abacus deals," elaborate and exotic investments that worked essentially like placing bets on mortgages and loans. When a borrower defaulted on a loan, and insurance then paid out, the holders of Abacus deals would theoretically earn big returns. According to The New York Times, Tourre and other figures at Goldman Sachs may have attempted to mislead investors about the loans at the heart of the Abacus deals, to make the assets seem more promising.7 Then, they would profit when the borrowers defaulted and the investors lost their money.
SEC Allegations
The issue at the heart of the government's case against Goldman Sachs and Tourre stems from conflicts of interest. The allegations concern subprime mortgage securities which were sold to investors by Goldman Sachs, while the company was betting against these same subprime mortgages behind the scenes. So, in essence, the company was allegedly encouraging its clients to invest in subprime mortgage securities while simultaneously ensuring that these mortgages would default, and would profit by placing bets on these defaults in advance. The SEC estimates that these activities cost Goldman Sachs investors in excess of $1 billion.8



Goldman Sachs responded in a statement, saying the SEC's case has no foundation in the law. The New York Times noted that this is the first time the SEC has gone after a Wall Street deal that allowed investors to profit from the collapse of the housing market.8
Potential Consequences
It is important to note that the SEC's case against Tourre and Goldman Sachs is not a criminal charge, but a civil lawsuit, so there is no chance of jail time.6 The fact that the Justice Department did not file criminal charges simultaneous with the SEC charges could indicate that some representatives there felt the case against Tourre was not strong enough.6



Likely results could include Goldman Sachs paying fines up to hundreds of millions of dollars and Tourre being dismissed from the firm.6
Bloomberg: "Goldman Sachs Sued by SEC for Fraud"

Bloomberg TV report about the case against Goldman Sachs and Fabrice Tourre.