Goldman Sachs and Morgan Stanley are in initial stage of talks with the US Department of Justice (DoJ) over claims that they mis-sold mortgage-backed securities, the Financial Times has reported.
Officials are still gathering evidence from Goldman and Morgan Stanley and negotiations and potential deals are still some way off, people familiar with the matter told the FT.
Earlier, JPMorgan and Citi also resolved similar claims by agreeing to DoJ US$9 billion and US$7 billion respectively.
In case the two banks reach a settlement with the DoJ, they will probably agree to different settlement terms because – unlike BofA and JPMorgan – neither bank was a big mortgage originator, the publication reported quoting the undisclosed sources.
On 22 August, Goldman agreed to pay US$1.2 billion to settle a related action from a different US government agency, the Federal Housing Finance Agency, which alleged it had sold bad mortgage-backed securities.