Goldman Sachs given more time to respond to SEC lawsuit

Goldman Sachs will have more time to respond to an April 16 government lawsuit alleging the firm defrauded investors while selling securities linked to subprime mortgages. 

In New York on Monday, U.S. District Judge Barbara Jones agreed to give Goldman an extra month, extending the deadline to July 19 from June 21, according to news reports. 

The Securities and Exchange Commission, which filed the suit about two months ago, signed off on the extension.

The SEC has accused Goldman employee Fabrice Tourre of not disclosing the role the hedge fund Paulson & Co. played in selecting and betting against mortgage securities. 

The lawsuit alleges the company and Tourre made misleading statements and omissions in 2007 in connection with a synthetic collateralized debt obligation (CDO) structured and marketed to investors. The CDO was tied to the performance of subprime residential mortgage-backed securities and "contributed to the recent financial crisis by magnifying losses associated with the downturn in the United States housing market," the SEC lawsuit says. 

During congressional testimony in late April, Tourre and Goldman CEO Lloyd Blankfein denied the allegations, saying they didn't do anything wrong.