The Securities and Exchange Commission's civil fraud suit against Goldman Sachs "reeks" of political motivation, Rep. Darrell Issa (R. Calif) told CNBC.
Issa, who is the ranking member of the Committee on Oversight and Government Reform, sent a letter to the SEC questioning why the charges against Goldman came on the eve of President Obama’s final push for financial regulatory reform and just hours before a damaging report from the SEC Inspector General that the agency knew Allen Stanford was involved in a Ponzi scheme as far back as 1997.
“This reeks of some motivation other than business as usual,” said Issa, who also questioned why the charges were filed in the middle of the trading day.
Issa said the five-member SEC, which made a 3-2 decision to charge Goldman Sachs along party lines, could have filed the fraud charges six months ago or six months from now.
The charges allege Goldman made materially misleading statements and omissions in connection with a synthetic collateralized debt obligation (CDO) that was structured by Goldman and marketed to investors.
“It’s our job to find out whether they were properly motivated, picked the time properly and were not intended to interfere either with Congress and its actions or just possibly hide an (Inspector General) report that came out the same day,” he added.
In his letter, Issa requested additional information from the SEC, including what elected officials spoke with the commission before the charges were filed.