Investigators Probe Fidelity-Goldman (GS) Relationship -WSJ

A Wall Street Journal article published this morning discusses the New York Attorney General's recent probe into the relationship between Fidelity Investments and Goldman Sachs (NYSE: GS) as it relates to its investigation into Fidelity's sale of auction-rate securities to individual investors.

According to the article, investigators are considering whether Fidelity's partnership with Goldman could have given the fund an incentive to sell the auction-rate securities as the majority of Fidelity's ARS sold were underwritten by Goldman. Cited in the article, a Fidelity spokesperson insists that "there was no incentive for Fidelity to promote auction-rate securities."

Moreover, the WSJ article notes that Fidelity may have specifically targeted ARS underwritten by Goldman as the fund could have been getting other services from the bank, such as the underwriting of private offerings or financial-counseling services provided by Goldman's Ayco unit.

The Goldman Sachs Group, Inc. provides a range of investment banking, securities, and investment management services to corporations, financial institutions, governments, and high-net-worth individuals worldwide.