Blankfein's response on Role Was ‘Troublesome,’ Angelides Says

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Jan. 13 (Bloomberg) -- Lloyd Blankfein, the head of Goldman Sachs Group Inc., failed to own up to his firm’s role in selling mortgage securities that helped trigger the global credit crisis, said the chairman of the panel investigating the financial meltdown.

“Mr. Blankfein himself never admitted that there was any responsibility of Goldman Sachs to make sure the products themselves were good products,” Philip Angelides, chairman of the Financial Crisis Inquiry Commission, told reporters after a hearing in Washington today. “That’s very troublesome.”

Blankfein, the New York-based firm’s chairman and chief executive officer, found himself targeted for questioning as the panel opened two days of hearings on the causes of a collapse that led to a $700 billion U.S. government bailout of the nation’s banks. Brian Moynihan, John Mack and Jamie Dimon, who oversee Bank of America Corp., Morgan Stanley and JPMorgan Chase & Co., also appeared today.

Blankfein, 55, said in response to questions from the panel that Goldman Sachs sold securities to the “most sophisticated investors who sought that exposure.” While the firm has a duty to disclose risks to investors, Goldman Sachs couldn’t predict how the securities would perform, he said.

“We did not know at any minute what would happen next,” Blankfein said. “There were people in the market who thought it was going down and there were others who thought these prices had gone down so much they were going to bounce up again.”
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