UK’s Brown raises pitch for probe into Goldman fraud charge

Goldman Sachs was charged with fraud by the US Securities and Exchange Commission (SEC) on Friday over its marketing of a subprime mortgage product. Goldman has called the US lawsuit “completely unfounded” and has vowed to defend itself.

“I want a special investigation done into the entanglement of Goldman Sachs and the companies there with other banks and what happened,” Brown told BBC television.

“There are hundreds of millions of pounds have been traded here and it looks as if people were misled about what happened. I want the Financial Services Authority (FSA) to investigate it immediately,” he said.

“I know that the banks themselves will be considering legal action,” Brown said,apparently referring to European banks that lost money on the product marketed by Goldman Sachs.

“We will work with the Securities and Exchange Commission in the United States,” he said. A spokeswoman for the FSA declined comment. “We would never confirm or deny we are investigating anybody,” she said. A person familiar with the matter said the FSA was liaising with the SEC,but currently viewed the investigation as primarily a US matter. Brown’s Labour Party lags in the polls before the May 6 election and a tough stance against bankers is popular with voters.