NY prosecutors subpoena Goldman Sachs

NEW YORK (Reuters) – Goldman Sachs Group received a subpoena from New York prosecutors seeking information on the investment bank’s role leading into the global financial crisis, a person familiar with the matter said.

Goldman shares fell as much as 3.4 percent as news of the subpoena emerged, but then took back much of their losses, trading down 1.3 percent by midmorning.

The Manhattan District Attorney’s office subpoenaed the bank to learn more about facts unearthed by a U.S. Senate subcommittee report about Wall Street’s role in the housing market collapse.

That report said that in the months leading up to the financial crisis, Goldman dumped bad mortgage exposure on unsuspecting clients and counterparties, and in some cases dragged its heels when clients wanted to close out their losing positions.

The Department of Justice is also looking into claims made by the report from the Senate’s Permanent Subcommittee on Investigations, known as the Levin Report for the subcommittee’s chairman, Senator Carl Levin.

The Manhattan District Attorney’s office was not immediately available to comment.

“We don’t comment on specific regulatory or legal issues, but subpoenas are a normal part of the information request process and, of course, when we receive them, we cooperate fully,” Goldman said in a statement.

Goldman’s shares were down 1.3 percent at $134.41.

(Reporting by Lauren Tara LaCapra; Editing by Dan Wilchins, Derek Caney and Lisa Von Ahn)