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Goldman Sachs settle rate-rigging lawsuit for $56.5m

Goldman Sachs was accused of rigging an interest rate benchmark in the derivatives market. Credit: Reuters

Goldman Sachs Group Inc is to pay $56.5 million (£45.2 million) to settle a US lawsuit accusing it and other banks of rigging an interest rate benchmark used in the $553 trillion derivatives market.

As part of the deal, it has also agreed to provide prosecutors evidence including transaction data, documents and witness interviews which could be used in future litigation against other banks.

The proposed settlement was disclosed in papers filed in federal court in Manhattan on Friday.

It came after seven other banks agreed in May to pay a combined $324 million to resolve the litigation.

'Goldman Sachs Elevator' tweeter outed as non-employee

The man behind a hugely popular 'overheard in the Goldman Sachs elevator' Twitter account has been outed as a 34-year-old Texan who has never worked for the firm.

Tweeting to more than 600,000 followers, @GSElevator had been the subject of an internal inquiry at the Wall Street investment bank after appearing

"The stories aren’t Goldman Sachs in particular. It was about the culture in general,” said John Lefevre after revealing his identity to the New York Times.

He was speaking about a book deal signed on the back of the success of his Twitter account, which proved as popular with banking industry insiders as it did with outside observers.


Wall Street stands to earn millions from Twitter IPO

Wall Street firms stand to gain as much as $50 million (£31m) from Twitter)'s planned stock market flotation and are jostling for a role in the sale.

Goldman Sachs' headquarters in New York Credit: REUTERS/Jessica Rinaldi

Goldman Sachs has already been named as lead underwriter, Reuters reports citing a source familiar with the matter. Major banks from JPMorgan and Credit Suisse Group AG to Morgan Stanley are also thought to be vying for roles.

Assuming Twitter sells around a tenth of its shares, generating an estimated $1 billion (£630m), underwriters could expect an overall fee cut of 4-5 percent, according to one estimate.

This would see the underwriters dividing a fee pool of $40 million to $50 million.

Labour: Government must drop millionaire tax cut plans

Labour said the bank made the right decision. Credit: Reuters

Labour said Goldman Sachs made the "right decision" to pay bonus payments to staff this year, before the 50p tax rate is abolished, but called on the Government to drop plans to give a £3 billion tax cut to millionaires. Shadow Treasury Minister Chris Leslie said:

"Goldman Sachs has made the right decision, but the fact remains that from April thousands of bankers and millionaires will get a huge tax cut from David Cameron and George Osborne."

"The Government should drop their plan to give a £3 billion tax cut to the richest people in the country while slashing tax credits for millions of working people on modest incomes. And they should repeat Labour's bank bonus tax to fund a guaranteed job for young people out of work."

"Thanks to George Osborne's tax cut for millionaires, next year's bonus round looks set to be very lucrative for thousands of bankers."

Goldman Sachs U-turn on bonus tax plans

Investment bank Goldman Sachs have decided not to defer bonuses until the next tax year, meaning those receiving bumper payouts will have to pay the 50p tax rate.

The bank had been planning to delay paying their staff bonus payouts until after April this year: which would have allowed them to benefit from the government's tax cut for those earning over £150,000, due to come in April.

Bank of England Governor Sir Mervyn King criticised the plans earlier today, saying they were "depressing" whilst speaking to the Treasury select committee.


Mervyn King slams greedy bankers over bonus tax plans

Sir Mervyn King said the move was "depressing" and "clumsy". Credit: David Jones/PA Wire

Bank of England governor Sir Mervyn King has hit out at greedy bankers amid reports that Goldman Sachs was set to delay staff bonus payments until after the 50p tax rate is reduced.

Income tax on people earning an annual salary of more than £150,000 is set to drop to 45p in April, allowing banks the opportunity to pay less tax by delaying payments.

Sir Mervyn criticised the practice while speaking to the Treasury select committee this morning, saying: "I find it a bit depressing that people who earn so much find it's even more exciting to adjust the timing of (their bonus payouts) to get the benefit of the lower tax rate."

Tax avoidance campaign can challenge 'deal' between HMRC and Goldman Sachs

Tax avoidance campaigners have won High Court permission to challenge an alleged "sweetheart" deal between HM Revenue and Customs (HMRC) and Goldman Sachs.

UK Uncut Legal Action were given leave by Mr Justice Simon, sitting in London, to seek a declaration that an agreement allowing the banking giant to skip a multimillion-pound interest bill on unpaid tax on bonuses was unlawful.

They want £20 million allegedly involved to be returned to the public purse.The judge ruled UK Uncut had "an arguable case" that should go to a full judicial review hearing.

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