Goldman Sachs Will Pay Record $550 Million to Settle SEC Charges

Under the deal, Goldman Sachs admits its marketing materials failed to disclose important information.  But while paying a record fine, Goldman did not admit or deny the fraud allegations raised by the SEC.  Instead, the firm refers to the omissions in its marketing materials as a "mistake."

The SEC enforcement chief said "the settlement is a stark lesson to Wall Street firms" about engaging in deceptive practices. Out of the fine, $250 million will be returned to investors and $300 million goes to the government.

While the fine was the largest against a financial company in SEC history, the settlement amounts to less than 5 percent of Goldman's 2009 net income of $12.2 billion after payment of dividends to preferred shareholders — or a little more than two weeks of net income.

Federal prosecutors have also launched a preliminary criminal inquiry into Goldman Sachs' dealings. The settlement with the SEC does not impact that investigation.