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Goldman Faces Regulatory Probe Linked to Panama Papers

As the huge trove of leaked documents or the “Panama Papers"  continues to prompt  government investigations around the world,  Wall Street giant –The Goldman Sachs Group, Inc. GS becomes the latest bank to come under regulatory scanner over suspicion of a likely involvement with shell companies.

The news, first reported by the Bloomberg stated that The New York Department of Financial Services (NYDFS) has asked Goldman and three other global banks to provide the regulator with information regarding shell companies set up through a Panamanian law firm. The three other banks are Canadian Imperial Bank of Commerce, BNP Paribas SA BNPQY and Standard Chartered Plc.

Notably, on Monday The International Consortium of Investigative Journalists that worked with international media partners including The Guardian and BBC on reporting of the leaked files, made its database of the documents publicly available on its website.

Through the database, the NYDFS officials found that Goldman and the three banks that are licensed by the state of New York had established Panamanian shell companies.  However, none of these banks are accused of any wrong doing.

The NYDFS’s latest letter is almost akin to the one sent last month to 13 banks, including Deutsche Bank AG DB, Credit Suisse Group AG CS, Commerzbank AG and Societe Generale SA. The New York State’s financial regulator is seeking information regarding the banks’ interactions with the offshore law firm, Mossack Fonseca and the possible dealings among the employees of the banks’ New York branches and the law firm or the shell companies set up through it.

The regulator also asked the banks to reveal any ongoing internal or external probes involving the law firm or shell companies sponsored by them, including any investigation commenced in U.S. or abroad.
 
Currently Goldman carries a Zacks Rank# 3 (Hold).

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CREDIT SUISSE (CS): Free Stock Analysis Report
 
DEUTSCHE BK AG (DB): Free Stock Analysis Report
 
BNP PARIBAS-ADR (BNPQY): Free Stock Analysis Report
 
GOLDMAN SACHS (GS): Free Stock Analysis Report
 
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