n April 11, 2016, the United States Department of Justice, the States of California and Illinois, and The Goldman Sachs Group, Inc., as well as its current and former subsidiaries and affiliates (collectively, “Goldman Sachs”) reached an agreement resolving claims resulting from Goldman Sachs’ marketing, structuring, arrangement, underwriting, issuance, and sale of residential mortgage-backed securities. Simultaneously, a separate agreement was reached between the State of New York and Goldman Sachs resolving alleged violations of New York law in connection with the marketing, structuring, arrangement, underwriting, issuance and sale of residential mortgage-backed securities by Goldman Sachs. Together, the agreements are referred to as the “Global Settlement Agreement.”
Under the Global Settlement Agreement, Goldman Sachs is required to pay $2.96 billion to the United States Department of Justice; $10 million to the State of California; $25 million to the State of Illinois; $190 million to the State of New York; $37.5 million to Federal Home Loan Bank of Chicago; and $37.5 million to Federal Home Loan Bank of Des Moines. In addition, Goldman Sachs is required to provide $1.8 billion in consumer relief.
Consumer relief may include repayment plans, loan modifications, settlements, short sales and deeds-in-lieu of foreclosure. More information regarding consumer relief may be found by clicking here
Under the Global Settlement Agreement, the Monitor was appointed to publicly: (i) report quarterly on Goldman Sachs’ progress towards completion of the consumer relief portion of the Global Settlement Agreement; (ii) report on credits earned by Goldman Sachs; and (iii) determine and certify Goldman Sachs’ compliance with the terms of the Global Settlement Agreement. The Monitor must file his first quarterly report by September 16, 2016.
Goldman Sachs must complete all consumer relief obligations under the Global Settlement Agreement by January 31, 2021. Goldman Sachs is entitled to a 150% enhanced early incentive credit for first lien principal forgiveness offered or completed by November 30, 2016 (subject to restrictions outlined in the Global Settlement Agreement) and a 115% early incentive credit for all consumer relief activity offered or completed by June 30, 2017.
The Monitor has retained Young Conaway Stargatt & Taylor, LLP and BDO USA, LLP to assist him in conducting his work under the Global Settlement Agreement.
To read more about the Monitor, please click here.
To read the Global Settlement Agreement, please click here.