Fabrice “Fabulous Fab” Tourre is living the surreal life.
During his third day on the witness stand, defense lawyers for the former Goldman Sachs banker sparred with the prosecution over what Tourre meant when he wrote in a 2007 email, “This is surreal.”
The Securities and Exchange Commission has accused the 34-year-old Frenchman of misleading clients about a complex mortgage deal to help hedge-fund titan John Paulson profit on the housing collapse.
In the e-mail to his boss, Tourre wrote: “I am at the ACA-Paulson meeting, this is surreal.”
The SEC’s lead lawyer, Matthew Martens, has tried to get Tourre to admit that the “surreal” aspect was his tricking bond insurer ACA into believing that Paulson was an investor in the mortgage deal, called Abacus, when in fact he was betting against it.
Tourre has testified that he doesn’t have a clear recollection of the meeting or what he meant by “surreal.”
But yesterday, Pamela Chepiga, a lawyer for Tourre, “refreshed” his memory of the meeting through the use of documents. That led the banker to testify that his surreal comment was likely in reference to learning that Paulson was betting that the big banks would fail — not just the subprime mortgage market.
Martens attempted to throw doubt on Tourre’s sudden recollection, referring to earlier testimony in 2009 and 2011, during which the trader couldn’t recall his intended meaning.
Manhattan federal Judge Katherine Forrest said she would allow one of the documents that Chepiga provided to Tourre to be submitted into evidence — meaning they can be later reviewed by the jury in its deliberations.
At the end of the second week of trial, Tourre also revealed that he made a cool $750,000 during his unpaid absence from the gold-plated investment bank the year after he and Goldman were named in fraud allegations by the government.
Tourre said the firm opted to pay him his base salary at the time because they both held out hope three years ago that he had a chance to “clear his name.”
“There was still hope … I would come back to Goldman Sachs so they put me on paid leave,” he told the jury.