Liberty Mutual Sues Goldman Over Freddie Mac Offering

Law360, New York (July 7, 2011, 9:55 PM EDT) -- Liberty Mutual Insurance Co. and four affiliates on Wednesday sued Goldman Sachs & Co. in Massachusetts for allegedly misleading investors about the quality of stocks in a 2007 Freddie Mac offering.

The complaint alleges that Goldman executives misled investors about the health of Freddie Mac and the mortgage-backed securities underlying a preferred offering of Series Z stock on Nov. 29, 2007, while taking huge short positions on similar securities that netted Goldman $3.7 billion in profits that year.

“Goldman's actions in underwriting the Series Z offering...
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