The government’s case against Goldman Sachs is about to get its first public airing, in what could be a gripping preview of the legal battle to come.
On Tuesday, the Goldman Sachs trader accused of fraud by federal regulators, Fabrice P. Tourre, and at least three of the bank’s top executives will testify before a Senate panel to defend the firm’s business activities and reputation, people briefed on the proceedings said on Wednesday.
The Goldman executives agreeing to appear before the Permanent Subcommittee on Investigations include the firm’s finance chief, David Viniar, and its chief risk officer, Craig Broderick, the people briefed on the matter said. They will join their chief executive, Lloyd C. Blankfein, whose plan to appear was already widely known.
Several senior managers in Goldman’s mortgage unit, which is at the center of the government’s civil case, have also agreed to testify, these people said.
Initially, the hearing was to examine the role of Wall Street banks in the creation and sale of mortgage investments and derivatives. But Goldman’s new legal troubles concerning one of those deals has narrowed the committee’s focus.
That Goldman is sending so many of its employees to testify before the panel underscores the lengths to which it will go to restore its tarnished image and declining share price.
Their testimony will put a spotlight on a case that has already become a subject of political acrimony. On Tuesday, Republican members of the House oversight committee released a statement accusing the Securities and Exchange Commission of political motivations in its pursuit of a case against Goldman.
They suggested that the action was timed to coincide with the Democrats’ effort to pass new financial regulations, and they demanded information about any coordination the agency might have had with the White House to affect the timing of the suit.
The commission’s chairwoman, Mary L. Schapiro, responded on Wednesday: “The S.E.C. is an independent law enforcement agency. We do not coordinate our enforcement actions with the White House, Congress or political committees. We do not time our cases around political events.”
President Obama also addressed charges of collusion in an appearance on CNBC on Wednesday. The S.E.C., he said, “never discussed with us anything with respect to the charges.”
Goldman’s reputation has been under attack since the S.E.C. filed its civil suit against Goldman and Mr. Tourre, accusing them of misleading investors by selling them a complex mortgage investment that was secretly devised to fail.
Goldman has denied any wrongdoing and has said it will vigorously defend itself in court and in public to protect its valuable reputation. Its share price declined 13 percent Friday, the day the civil suit was filed, and it has been falling steadily since then. The firm has also been reaching out to clients to calm their anxiety over its potential exposure in the case.
The executives are expected to make arguments similar to those they have laid out in public since the suit was filed and in written responses to the S.E.C.’s initial inquiry last fall.
Among them were that the investors in the deal were sophisticated enough to understand what they were buying, that a bearish hedge fund manager’s influence in choosing components of the investment was not material and that the S.E.C. was faulting Goldman through the lens of “perfect hindsight.”
Even if the executives can effectively use the Senate appearance to persuade their clients, if not the broader public, of the firm’s innocence, putting so much testimony on the record voluntarily could give the S.E.C. more ammunition, legal experts said.
“Experience has shown that top executives who testify put themselves in jeopardy,” said Mark C. Zauderer, a veteran corporate litigator at Flemming Zulack Williamson Zauderer in New York. He added, “Notwithstanding a desire to tell your story, spreading it on the public record in a hostile environment is not a great idea.”
Goldman has retained Gregory Craig, the former White House counsel to Mr. Obama, to help the firm navigate the flurry of Congressional hearings and investigations, although federal law and Obama administration policy preclude him from directly lobbying or contacting the White House as part of his work.
The bank employs a coterie of prominent outside lobbyists to get its message across to lawmakers, according to filings. They include Richard Gephardt, the former House majority leader; Ken Duberstein, a former chief of staff in the Reagan White House; Stephen Elmendorf, a former adviser to Mr. Gephardt; and Janice O’Connell, a former adviser to Senator Christopher J. Dodd, the chairman of the Senate Banking Committee.
All told, Goldman spent about $2.8 million on lobbying last year, according to the filings.
With financial regulation at the top of Washington’s agenda, the Senate committee hearing is the latest to examine the causes of the financial crisis. It recently looked into the failure of banking regulation, and it is expected to focus on the credit rating agencies later this week.
But the hearing next week, which was called to examine the type of investment vehicle cited in the S.E.C. suit against Goldman, appears to have been sped up. Senate investigators had laid out a timetable to comb through the millions of documents that Goldman turned over and to interview several of its executives in May, the people briefed on the matter said. But recently, the schedule was accelerated.
Members of the committee, which is led by Senator Carl Levin of Michigan, declined to comment.
Eric Lichtblau contributed reporting.