Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 

4-Traders Homepage  >  Equities  >  Nyse  >  Goldman Sachs Group Inc    GS

Delayed Quote. Delayed  - 08/29 10:00:09 pm
166.87 USD   +0.54%
08/29 GOLDMAN SACHS : LEDs, Not Solar, Have Transformed Their Industry
08/29DJBrazil's Rousseff Defends Herself at Senate Impeachment Trial
08/29 GOLDMAN SACHS : Paytm in talks to raise fresh funding from Goldman S..
SummaryQuotesChartsNewsAnalysisCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsSector news 

Morgan Stanley trader was probed at Goldman: sources

share with twitter share with LinkedIn share with facebook
share via e-mail
0
12/04/2012 | 12:07am CEST

Morgan Stanley hired former Goldman Sachs trader Edward Glenn Hadden to run its Treasury bond desk last year, even though his former employer had placed the trader on paid leave for about a year following an internal inquiry, said three people familiar with the situation.

The inquiry by Goldman involved a matter separate from an ongoing investigation by exchange operator CME Group into a December 2008 trade that involved U.S. Treasury futures.

Neither Hadden nor Goldman has been accused of wrongdoing in the 2008 trading incident. But the decision by Morgan Stanley to hire Hadden even though some of his activities had raised questions within Goldman could put the firm in an uncomfortable position in light of the revelations of the CME Group investigation.

Hadden was a partner at Goldman Sachs when the 2008 trade drawing scrutiny occurred. The incident that led to the Goldman internal inquiry took place the end of 2009 and involved profits Hadden is said to have made ahead of the launch of a new Treasury futures contract introduced by the CME Group in early 2010.

Morgan Stanley and Goldman Sachs both recently learned of the CME investigation into the 2008 incident. But sources said Morgan Stanley was aware Goldman had put Hadden on paid leave when it hired him in March 2011.

Hadden's lawyer said his client did nothing wrong with the 2008 trade and expects the CME to reach a similar conclusion when it completes its investigation.

"There is no legal or factual basis for any suggestion of market manipulation," said James Benjamin, who defended his client in response to a recent regulatory disclosure by the firm that Hadden is being investigated by CME over a 4-year-old trade.

Benjamin had no comment about the incident that led to Goldman putting Hadden on paid leave that effectively barred him from trading at the firm for about a year.

Hadden, who goes by his middle name "Glenn," officially left Goldman (>> Goldman Sachs Group, Inc.) in late 2010. A few months later, Hadden, who had been a partner at Goldman, joined Morgan Stanley with much fanfare to run the Wall Street firm's Treasury bond and interest rate derivatives trading desk.

Hadden is one of the most successful traders in the market for Treasury bonds and interest rate derivatives, whose value stands at $531.6 trillion, according to the Securities Industry and Financial Markets Association. He had worked for Goldman Sachs for about 11 years before voluntarily leaving the firm at the end of 2010.

Trading in Treasuries and interest rate derivatives is an important part of Morgan Stanley's bond trading business, as it focuses on high-volume trading that can be easily automated and cleared under new regulations, rather than riskier and more complex over-the-counter trades.

Benjamin, a defense attorney with Akin Gump, said the CME investigation involves a "technical risk management activity" that occurred "in a one-minute period four years ago." While Benjamin declined to discuss the specifics of the allegation against Hadden in his statement, the lawyer said his client had "acted properly and followed established market practice."

CME Group declined to comment.

Morgan Stanley spokesman Mark Lake said Hadden is still employed by the firm, and in good standing.

News of the investigation broke on Sunday evening when The New York Times posted a story on its website about Hadden with the headline "Morgan Stanley Trader Faces Inquiry on Possible Manipulation."

The paper, citing a regulatory filing and sources familiar with the matter, said the CME was investigating Hadden over whether his Treasury futures trading had manipulated prices.

Hadden's file with the Financial Industry Regulatory Authority cites a pending CME investigation of his Treasury futures orders placed on the expiration date in December 2008.

The trades being probed by the CME pertained to programs set up by the Federal Reserve during the height of the financial crisis to help support Wall Street and the banking system, a person familiar with the matter said.

The New York Times reported that some at the Fed had suspected that Goldman was trying to improperly profit from one of the government's bond-buying programs, and complained to Goldman about Hadden.

The 2009 incident that led to the Goldman internal inquiry also involved Treasury futures but had nothing to do with the U.S. government's efforts to prop up the financial system.

Instead, the 2009 matter involved a new Treasury futures trading product the CME was developing and one which Hadden had advised on, said those people, who were not authorized to speak publicly on the matter.

Hadden had found a way to structure a Treasury trade ahead of the CME's official announcement in September 2009 that it was going to launch in early 2010.

That incident moved his superiors at Goldman to put him on leave, keeping him on the payroll but preventing him from actively trading for about a year.

Indeed, even as the CME investigates Hadden over the 2008 incident, its product development team has continued to turn to him for help in devising new Treasury futures products. CME Group quoted Hadden in a September 18 press release highlighting a new interest rate swap futures product.

(Reporting by Lauren Tara LaCapra and Emily Flitter; Additional reporting by Ann Saphir; Editing by Matthew Goldstein, Steve Orlofsky, Leslie Gevirtz and Richard Chang)

By Lauren Tara LaCapra and Emily Flitter

Stocks treated in this article : CME Group Inc, Goldman Sachs Group, Inc., Morgan Stanley
share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on GOLDMAN SACHS GROUP INC
08/29 GOLDMAN SACHS : LEDs, Not Solar, Have Transformed Their Industry
08/29 GOLDMAN SACHS : EU staff petition attacks former EC president over Goldman Sachs..
08/29DJBrazil's Rousseff Defends Herself at Senate Impeachment Trial
08/29 GOLDMAN SACHS : Paytm in talks to raise fresh funding from Goldman Sachs, Mediat..
08/26 INDIA'S GDP TO GROW 7.9% : Goldman
08/25 GOLDMAN SACHS : Nifty ends below 8600 on F&O expiry day; Sensex falls 224 pts
08/25 GOLDMAN SACHS : MEDIA ALERT Bideawee and Goldman Sachs Sponsor Pet Vet Exams for..
08/24 GOLDMAN SACHS : OPEC and other oil manufacturers may conclude oil production fre..
08/24DJBlockchain Firm R3 Files for a Patent as Fintech Race Heats Up--Update
08/24 MINDFUL LEADERSHIP : How to Improve Focus, Clarity, Creativity, and More
More news
Sector news : Investment Banking & Brokerage Services - NEC
08/26DJFinance Watch -- WSJ
08/25DJCIBC Revenue and Profit Rise
08/24 MORGAN STANLEY : HK regulator fines Morgan Stanley, cites internal control failu..
08/24DJHONG KONG EXCHANGES AND CLEARING : China's Postal Savings Bank to Get $2 Billion..
08/22DJOil Prices Fall on Supply Expectations
More sector news : Investment Banking & Brokerage Services - NEC
News from SeekingAlpha
08/29 Magic Money
08/26 Is Dow Theory Telling Us The Stock Rally Is Going To Fail?
08/26 Goldman Sachs' And Wells Fargo's Derivatives Books
08/25 Shocked! Mylan, Biotechs Swoon After Hillary's Statement
08/25 Who Will Be The First 'Miss Big Blockchain'?
Advertisement
Financials ($)
Sales 2016 29 022 M
EBIT 2016 9 238 M
Net income 2016 6 116 M
Debt 2016 -
Yield 2016 1,61%
P/E ratio 2016 11,78
P/E ratio 2017 9,73
Capi. / Sales 2016 2,32x
Capi. / Sales 2017 2,15x
Capitalization 67 294 M
More Financials
Chart GOLDMAN SACHS GROUP INC
Duration : Period :
Goldman Sachs Group Inc Technical Analysis Chart | GS | US38141G1040 | 4-Traders
Full-screen chart
Technical analysis trends GOLDMAN SACHS GRO...
Short TermMid-TermLong Term
TrendsBullishNeutralNeutral
Technical analysis
Income Statement Evolution
More Financials
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 26
Average target price 181 $
Spread / Average Target 9,2%
Consensus details
EPS Revisions
More Estimates Revisions
Managers
NameTitle
Lloyd Craig Blankfein Chairman & Chief Executive Officer
Gary D. Cohn President, Chief Operating Officer & Director
Harvey Mitchell Schwartz Chief Financial Officer & Executive Vice President
R. Martin Chavez Chief Information Officer
James A. Johnson Independent Director
More about the company
Sector and Competitors
1st jan.Capitalization (M$)
GOLDMAN SACHS GROUP IN..-7.41%67 294
MORGAN STANLEY-1.26%59 572
CHARLES SCHWAB CORP-5.71%40 947
CITIC SECURITIES COMPA..-13.54%29 755
GUOSEN SECURITIES CO L..--.--%21 469
HUATAI SECURITIES CO.,..1.01%19 978
More Results