Impact of Goldman Sachs Fraud on Wall Street

As I was reading the e-newspaper on New York Times today, something surprising caught my eye.

Goldman Sachs, one of the top global investment banking system, was accused by United States Security and Exchange Commission(SEC) of defrauding customers who purchased investments that were tied to sub prime mortgages. It seems like a small mistake for Goldman Sachs; yet, this small incident perhaps may have confirmed many the many suspicion of Wall Street and other financial investing institutions. Throughout the financial meltdown, many major companies like General Motors Inc. have asked the US government for funds to “rescue” them with taxes. US government did made some investments in attempt to rescue these companies, and the general public knows it. What people do not know is that how are the investment allocated within the company. The bonuses of executives appears to have dropped, but no one knows for sure. Although this incident has yet to have sufficient evidence to be true, the release of such news to the media have drastically affected Goldman Sachs. The share of Goldman Sachs Inc. dropped simultaneously the news was issued worldwide. This news has dealt a major blow to Goldman Sachs regardless of its validity. Personally, I believe that it is unethical for Goldman Sachs to use investors’ funding as payment of mortgages. Accounting wise, it is violating the General Accepted Accounting Principles and causing turmoil within Wall Street. Also, I feel that the SEC will conduct more in depth research and analysis not only on Goldman Sachs, but also on other companies. These news sound devastating to investors and the reputation of Wall Street will sure be tarnished to a certain degree.