Former Goldman Sachs clients are coming out of the woodwork with complaints that the notorious bank bet against them too.

Including the country of Ghana -- or rather its former largest company, Ashanti Gold (via Credit Writedowns):

Ghana Web:

In 1998, Ashanti Gold was the 3rd largest Gold Mining company in the world. The first "black" company on the London Stock Exchange, Ashanti had just purchased the Geita mine in Tanzania, positioning Ashanti to become even larger. But in May 1999, the Treasury of the United Kingdom decided to sell off 415 tons of its gold reserves. With all that gold flooding the world market, the price of gold began to decline. By August 1999, the price of gold had fallen to $252/ounce, the lowest it had been in 20 years.

Ashanti turned to its Financial Advisors - Goldman Sachs - for advice. Goldman Sachs recommended that Ashanti purchase enormous hedge contracts - "bets" on the price of gold. Simplifying this somewhat, it was similar to when a homeowner 'locks in' a price for heating oil months in advance. Goldman recommended that Ashanti enter agreements to sell gold at a 'locked-in' price, and suggested that the price of gold would continue to fall.

But Goldman was more than just Ashanti's advisors. They were also sellers of these Hedge contracts, and stood to make money simply by selling them. And they were also world-wide sellers of Gold itself.

In September 1999 (one month later), 15 European Banks with whom Goldman had professional relationships made a unanimous surprise announcement that all 15 would stop selling gold on world markets for 5 years. The announcement immediately drove up gold prices to $307/ounce, and by October 6, it had risen to $362/ounce.

The full article at Ghana Web tells how Ashanti was driven to bankruptcy and sold to AngloGold. What really gets at the Ghanaian author and several hundred commenters is that every character in the story, down to the British gold company, was represented by Goldman Sachs.

Of course, there's nothing necessarily illegal about betting against a client -- Ghana or ACA. It depends on the exact circumstances. But this is the aspect of the Goldman SEC charges that will piss off past and future clients.

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