A Goldman Opportunity for Reform?

Sharon Churcher of the UK Mail reports, Revealed: British banker 'Fabulous Fab' - the high-flier at centre of huge Goldman ‘fraud’:

This is the British-based banker known as ‘Fabulous Fab’ charged in America with fraud for allegedly selling toxic mortgage investments deliberately designed to fail in the US housing market crash.

Fabrice Tourre was known for his expensive tastes at Goldman Sachs, the investment bank where investigators allege he sold sub-prime mortgage bond products to customers, who are estimated to have lost more than £645million.

The broker, who earned £1.5million a year, moved to London in 2008 after several years with the firm in New York, where he rented a £3,000-a-month apartment and claimed to be from a prominent French family.

One female acquaintance recalled: ‘I speak French so when we bumped into each other I would talk to him in French. He was a well-mannered, handsome guy [who said] he came from a very refined family.’

Tourre, 31, was known in the fashionable block of flats for throwing noisy parties.

‘He had one big blow-out party just before he moved out,’ the acqaintance said. ‘Some of the neighbours got very annoyed.’

The banker is accused of creating sub-prime mortgage investment deals devised to fail. US investigators claim Goldman Sachs lied to investors – the biggest being identified as as the Royal Bank of Scotland group – to make the mortgages sound like a safer deal. Meanwhile, billionaire hedge fund owner John Paulson made bets on the stock market that the investments would fail – earning an estimated £2billion.

American investors claim Tourre bragged in emails about the scheme. Mr Paulson is not accused of any wrongdoing.

A Wall Street expert who helped to raise the alarm about the alleged fraud said: ‘This is the most cynical scheme I ever saw. Tourre was very aggressive about trying to make the assets look better than they were.

'There’d been a raging bull market and that can cover a lot of sins. You could tell from his emails that this was the kind of kid who was in his element.’

Tourre was admired by colleagues, however, for what they called his ‘goofy sense of humour’. He was popular with clients, wooing them over games of tennis. According to a French social networking website, he has a long-term girlfriend.

The banker was a ‘straight-A’ student at the Lycee Henri IV, one of France’s most prestigious schools, housed in 6th Century abbey in Paris.

He went on to study maths at the Ecole Centrale Paris, one of the top French universities and obtained a master’s degree from Stanford in the US.

In London, his office is in a luxurious building on Fleet Street. A Mail on Sunday reporter who called there yesterday was told by an employee that ‘Mr Tourre is not working’.

When he was contacted on his mobile phone, he hung up and his lawyer did not respond to a request for comment.

US watchdog the Securities and Exchange Commission said a formal request would be made for Tourre to return to the country to face charges.