Goldman Shifting Spotlight on Fabrice Tourre?

Goldman Sachs may be embarking on a not-so-subtle shift in strategy as it defends itself against SEC fraud charges.

The bank has denied from the start that it misled investors in the marketing of a mortgage-backed security that a hedge fund client helped create, then bet against. But Goldman is now casting the SEC case as essentially an investigation into one man, 31-year-old Fabrice Tourre, according to a Bloomberg report.

"It's all going to be a factual dispute about what he remembers and what the other folks remember on the other side," Greg Palm, Goldman Sachs's co-general counsel, told reporters Tuesday, without naming Tourre. "If we had evidence that someone here was trying to mislead someone, that's not something we'd condone at all and we'd be the first one to take action."

Tourre, an executive director with the company, engineered the deal involving hedge fund Paulson & Co., which created a collateralized debt obligation backed by risky mortgages. While the securities in the CDO were ostensibly selected by a third party, ACA Management LLC, Paulson had a role in selecting the mortgages - a fact unknown to investors.

Goldman placed Tourre, the only individual named in the SEC complaint, on paid leave after the charges were filed. He will also be de-registered from the Financial Services Authority, Britain's regulatory body, according to the report.

Goldman may be putting some daylight between itself and Tourre, in part as a public relations maneuver to restore confidence in the bank's management and perhaps out of concern that Tourre will start cooperating with the SEC and shift responsibility for the transaction further up the executive chain.

"If Tourre says, 'Goldman's board knew what we were doing,' you can imagine Goldman will want to portray him as disgruntled," Onnig Dombalagian, a professor at Tulane University Law School who formerly worked at the SEC, told Bloomberg.

The Wall Street Journal reported Tuesday that a committee of senior Goldman executives charged with vetting transactions for risk approved the Paulson deal without much discussion.

Palm said the SEC case "clearly revolves a little bit around 'he said-she said'" and said the Tourre "believes that he indicated" to ACA that Paulson would be betting against the deal.

Palm also didn't rule out the possibility of a settlement before heading to trial.