Bond Insurer Hits Goldman With $120M Abacus Suit

Law360, New York (January 6, 2011, 7:21 PM EST) -- ACA Financial Guaranty Corp., which insured the so-called Abacus transaction for which Goldman Sachs Group Inc. paid a $550 million civil penalty last year, launched a $120 million suit Thursday alleging Goldman misled the bond insurer about the deal.

Goldman fraudulently induced ACA into insuring the transaction by providing deceptive information about the role of the hedge fund Paulson & Co. Inc., according to a suit filed in the Supreme Court of the State of New York, County of New York.

In addition to insuring the...
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