Goldman Sachs (NYSE: GS), as you can imagine, is in a full court press to communicate its position on the SEC's (SEC news) charges of fraud with its top customers. That has yielded one high-profile offer of support. The Blackstone Group has publically stated that it will stick with the embattled investment bank.

Lloyd Blankfein has been on the phone with other customers, according to media reports. His message is that he's eager to fight the charges in court, that "the government is out to kill them, that the charges are politically motivated, that the charges "hurts America," according to the Financial Times. But is this the wise move? Goldman Sachs has settled charges before--with the state of Massachusetts for $60 million over charges of marketing subprime-based securities, with the state of New York over its practices related to auction rate securities.

So what's different this time? Maybe Goldman feels singled out. Maybe because these are federal charges. Maybe because it's angry with the way the SEC blind-sided it. For whatever reason, the bank is now willing to go to the mat. That's tricky because there's so much you cannot control, especially when a jury is involved. We're already seeing the bank pay a price in the press and in Washington. My sense is that it would still be wise for the company to settle. 

For more:
- here's an article from the Washington Post

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