Goldman Sachs (Stock Quote: GS) keeps on catching heat. And this time, it’s Main Street that’s turning up the pressure on the investment giant.
First, the Securities and Exchange Commission files a civil suit, citing fraud over mortgage securities deals. Then, the Senate publicly scrutinizes the firm’s executives, including CEO Lloyd Blankfein, in a heated hearing. Next, the Justice Department and the state of New York announce they are launching a criminal investigation into the the deals. Now, Goldman Sachs has disclosed that more than six law suits have been filed by their own shareholders in the wake of the fraud allegations. And these plaintiffs aren’t limited to big-name investors.
Shareholders suing the firm include the Southeastern Pennsylvania Transportation Authority, the International Brotherhood of Electrical Workers Local 98 Pension Fund and the Louisiana Municipal Police Employees Retirement System. These unions represent hundreds of thousands of American workers, who had parts of their retirement funds tied up in Goldman stock.
According to the regulation SEC filing, all shareholders are charging the firm and its executives with "breach of fiduciary duty, corporate waste, abuse of control, mismanagement and unjust enrichment.”
MPERS cites that they had filed a similar complaint against Goldman’s Board of Directors in September 2009, requesting that the firm “take action to remedy breaches of fiduciary duties and other misconduct committed by … the Company.” Their new law suit incorporates the SEC charges of fraud as well as the bonuses paid out to executives in 2009. Ironically, these well publicized cases are likely to only devalue Goldman stock further.
Additionally, the law firm Wolf Popper LLP has filed a class-action law suit against the investment giant on behalf of investors who purchased Goldman securities between Aug. 5, 2009 and April 16, 2010. The firm is encouraging other investors to contact their attorney Robert Plosky via a press release.