Is there an end in sight to the regulatory woes of Goldman Sachs? Massachusetts regulators added to the pile-on when Commonwealth secretary William Galvin, the state's top financial regulator and prominent critic of some Wall Street practices, announced that Goldman Sachs has agreed to pay a $10 million fine in connection with so-called trading huddles.

These huddles brought together stock analysts, traders and clients to discuss market issues. Goldman Sachs did not admit to any fraud. Analysts would regularly provide tips on various stocks, "But some of their recommendations differed from ratings printed in Goldman's widely circulated reports. After the meetings, Goldman analysts would call some of the firm's biggest clients and give them their short-term views. Critics complained that the limited distribution of certain ideas was unfair to those clients who were not given the same information," notes the New York Times.

Goldman Sachs always claimed that the information handed to the preferred client was consistent with published reports. But Galvin told the Times that, "We verified that there was a preference of some customers at the expense of others." As part fo the agreement, huddles are no longer allowed. In the scheme of things, $10 million is very little for Goldman Sachs, which no doubt was happy to have the issue go away provided it could settle without any admission of fault. But it does add to the picture of a bank that was bent on pushing the regulatory limits at every turn.

Some in the industry would argue that this is what an aggressive bank should be doing. Others might disagree. In the end, this is yet more fodder for the Goldman Sachs board to chew on. It certainly has to own the responsibility for the risks represented by all the enforcement activity. The board can rest easier knowing that clients do not seem to mind doing business with it.

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