CHICAGO (Legal Newsline) - Illinois Attorney General Lisa Madigan announced that Goldman Sachs will pay $41 million due to alleged misconduct during the bank’s marketing and sale of residential mortgage-backed securities (RMBS) prior to the 2008 economic collapse.
Under the terms of the settlement, $25 million will be put toward the Illinois’ pension system and $16 million will be given in relief to Illinois consumers. The settlement stems from Madigan’s office’s charges that Goldman Sachs failed to disclose the true risk of many of its RMBS investments.
“With today’s settlement, I have recovered over $540 million for Illinois pension systems and residents as a result of fraudulent conduct in the mortgage-backed securities market,” Madigan said. “My office is continuing to recover critical funds for the state and homeowners due to Wall Street’s misconduct.”
Goldman Sach’s settlement is part of a $5 billion national settlement the U.S. Department of Justice has won over the past few years with help from state attorneys general and other entities.