A lawsuit was filed on January 7th against Goldman Sachs Group Inc. by an Illinois pension fund. The suit, filed in a New York state court, seeks to recover billions of dollars of bonuses and other compensation being awarded for 2009, alleging that the payouts harm shareholders. In the lawsuit filed on behalf of shareholders, the Central Laborers’ Pension Fund said Goldman had by September 25 set aside nearly $17 billion for compensation and might pay out more than $22 billion for the year. It said this “highlights the complete breakdown” of corporate oversight. The lawsuit contends further that Goldman’s revenue for the year was artificially inflated by government bailouts of the banking industry and the insurer American International Group Inc, as well as a change in Goldman’s fiscal year.
It was alleged that Goldman has shown “scant regard” for the interests of shareholders. Other Defendants in the suit are Chairman and Chief Executive Lloyd Blankfein, Chief Operating Officer Gary Cohn, Vice Chairman J. Michael Evans, Chief Financial Officer David Viniar, and ten directors. The Illinois fund is seeking damages sustained by shareholders, restitution from executive officer Defendants, corporate governance changes and other remedies in their lawsuit.
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