Thursday, April 4, 2013

Ex-Goldman trader turns himself in on fraud charges

By Lauren Tara LaCapra and Emily Flitter

NEW YORK (Reuters) - Ex-Goldman Sachs Group Inc trader Matthew Marshall Taylor has turned himself in to federal authorities in connection with charges that he defrauded the Wall Street bank out of $118 million in 2007, two sources familiar with the matter said.

Taylor voluntarily turned himself in to agents with the Federal Bureau of Investigation in New York around 8:30 a.m. EDT on Wednesday morning, said the sources, who spoke on condition of anonymity.

The Commodities Futures Trading Commission filed a civil lawsuit against Taylor in November, accusing him of fabricating trades to conceal an $8.3 billion futures position. The CFTC sought $130,000 in penalties.

Taylor's move on Wednesday is related to criminal charges that are expected to come from federal prosecutors in New York. He is expected to plead guilty to those charges later on Wednesday, the sources said. It was not clear precisely what he will be charged with.

An attorney who represented Taylor in his civil case did not immediately respond to a request for a comment. A Goldman spokesman declined to comment.

Goldman itself paid $1.5 million last year to settle charges that it had failed to appropriately supervise Taylor. The bank has since put in place procedures to catch wayward trading activity more quickly.

According to charges outlined against him, Taylor established his futures position in e-mini Standard & Poor's futures contracts on December 13, 2007. The next day, it was flagged by Goldman's controls. By the time the trade had been unwound, it had caused $118 million in losses.

After leaving Goldman Sachs, Taylor moved to a position at Morgan Stanley in March 2008. He left that bank in July 2012.

(Reporting by Lauren Tara LaCapra and Emily Flitter; Editing by Matthew Goldstein, Gerald E. McCormick and Maureen Bavdek)

Source: http://news.yahoo.com/ex-goldman-trader-taylor-turning-himself-authorities-sources-123115525--sector.html

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