WSJ finds the busted homeowners behind the Goldman Sachs deal
The Wall Street Journal showed in a graphic how a mortgage default in New Jersey, among others, led to a bank bailout in Germany as a result of the Goldman Sachs deal.
The Wall Street Journal took a personal approach to the Goldman Sachs story by looking at homeowners who defaulted on their mortgages, helping hedge-fund manager John Paulson make $1 billion. Carrick Mollenkamp, Mark Whitehouse and Anton Troianovski write that those mortgages were pooled together into a “so-called collateralized debt obligation, or CDO,” which Goldman created for Paulson.
“The hedge-fund manager invested heavily in a form of insurance that could yield huge gains if the borrowers grew unable to pay,” they write. At the same time, Goldman was marketing the CDO to its clients, who would profit only if borrowers paid the loans.
More than half of the mortgage holders have since defaulted or been foreclosed upon. Paulson won. The clients lost more than $1 billion. The Securities and Exchange Commission sued Goldman.
Goldman told investors that the bonds would be chosen by an independent manager. In the CDO, which was called Abacus 2007-AC1, however, Goldman let Paulson select mortgages that he believed were most likely to lose value, according to the SEC complaint.
The story includes a graphic illustrating how the loans became part of the CDO, photographs of the homes mentioned in the story and interviews with some of the defaulting mortgage holders.
Today’s Tip: Find ways to get the names behind the account numbers.
The writers say in their story that they “identified homeowners in the Abacus portfolio by taking the 90 bonds listed in a February 2007 Abacus pitchbook and matching them with court records, foreclosure listings, title records and loan-servicing reports. The bonds contained nearly 500,000 mortgage loans.”
That sounds daunting, but as noted by a Pulitzer Prize winner and others in this blog recently, computer-assisted reporting can make it happen.
First determine what you need. Much information can be found in public records; you just need to know where to go and what specific information you need in your FOIA request. One way to get those specifics is to request the form — electronic or paper — that the agency uses to collect the data.
The Sunlight Foundation, a nonprofit that works to make government more accountable and transparent, has just launched the National Data Catalog; its first data sets include information on air quality and active mines in the United States.
Here are some more resources for mining data on the Web from Jaimi Dowdell, a training director for Investigative Reporters and Editors.
Another way to find real people is through social media. Here are self-guided Webinars on how to use social media to improve your reporting.
