Singapore. A top Asian fund manager said on Wednesday the civil fraud allegations against massive Wall Street bank Goldman Sachs was a smokescreen to divert attention from the financial crisis in the United States.
Goldman is being investigated for fraud by the Securities and Exchange Commission and Britains market watchdog.
It has also been learned that banks here in Asia are using the US banks woes to get an edge on multimillion-dollar fee-paying deals in the region.
Marc Faber, who runs Hong Kong-based fund manager Marc Faber, described the lawsuit against Goldman Sachs as a hunt for scapegoats amid economic problems faced by the US.
The target now is Goldman Sachs. You distract the masses with a villain, he said at the Asian Public Real Estate Association Forum in Singapore. Goldmans leading role on Wall Street, coupled with massive paychecks to staff and bumper profits, make it an obvious target, Faber said.
Rival institutions in Asia were seizing on Goldmans problems to try and elbow in front of the bank on major upcoming deals, sources familiar with the matter said.
Investment bankers have been lobbying executives at state-owned Agricultural Bank of China and pushing officials in Beijing to drop Goldman as an underwriter for the banks more than $20 billion IPO.
Rivals are also asking officials at state-controlled Bank of Communications to ditch Goldman from its joint global coordinator role in the Chinese banks $6.1 billion rights issue, the sources said, though there was no evidence either bank was considering pushing Goldman aside.