We've noted that one of the big questions surrounding the SEC's (SEC news) enforcement action against Goldman Sachs (NYSE: GS) is whether the practices that the SEC alleged were common across many CDOs (CDO news). The SEC of course chose to bring a very narrow case involving a single CDO issue. That probably signals that the SEC is very confident on this specific issue.

It may be that it was common to give big clients a lot of influence when it came to the creation of CDOs. That's murky right now. But you can bet that investment firms that ended up on the losing end will now be pondering their legal options. You can bet they'll also be scouring their agreements for disclosures about how the CDOs they bought were managed. A lot of the "suckers," so to speak, were European institutions, and to a lesser extent, Asian institutions. It would hardly be surprising if we see a spate of civil suits from them. The AP thinks a wave of other suits may be coming, including suits by shareholders and even criminal charges. 

For more:
- here's a columnist also discussing a wave of suits

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