Goldman Sachs Chief Faces Congress

New York, NY —

The CEO of Goldman Sachs is in the hot seat today testifying before a Senate subcommittee about the role his bank played in the financial crisis. The Securities and Exchange Commission sued Goldman earlier this month alleging that the bank misled investors about securities tied to home loans.

Goldman CEO Lloyd Blankfein is expected to say that his bank did not bet against its clients because it can't survive without client trust, that his bank did not bet against the housing market, and that Goldman Sachs lost $1.2 billion in 2007 and 2008 from the residential mortgage meltdown.

A Senate subcommittee has found evidence to suggest differently, citing e-mails and other documents obtained during an 18-month investigation. It says the Wall Street firm developed a strategy to profit from the housing meltdown and reaped billions at the expense of clients. Blankfein says his firm was managing its risk as shareholders and regulators would expect.