Tourre: He did not aim to dupe investors

Fabrice Tourre testified that he did not aim to mislead investors as the former Goldman Sachs trader took the stand in the government fraud trial against him. Tourre, facing tough questioning Wednesday from an attorney with the US Securities and Exchange Commission, defended himself vigorously from accusations that he mischaracterized the role of hedge fund Paulson & Co. to investors. The 2007 investment, tied to \"sub-prime\" loans, lost $1 billion after the housing bust, according to the SEC. The SEC has charged Tourre with misrepresenting Paulson\'s role in the transaction in communications with financial group ACA, which participated with Paulson in the selection of the fund, known as \"Abacus,\" before investing in it. The government maintains that Tourre depicted Paulson\'s investment as a bet the value of Abacus would rise when in fact Paulson was wagering the investment would fall. In previous testimony, former ACA executive Laura Schwartz recounted that she understood from early communications with Tourre that Paulson was betting that its value would rise. The SEC questioned Tourre about a January 2007 email from Schwartz in which she refers to Paulson as having an \"equity perspective\" in the deal, meaning Paulson was betting it would rise. Tourre did not recall correcting her. The SEC maintains that in another email a few days later from Tourre to Schwartz detailing the possible components of Abacus, Tourre reinforces the impression that Paulson would be betting that the value of Abacus would rise. \"I was not trying to confuse anybody\" with this e-mail, said Tourre. \"It was not accurate at the time.\" \"Is there a difference in your mind between something inaccurate and false?\" queried SEC attorney Matthew Martens. \"Yes,\" replied Tourre. Tourre said transactions like Abacus frequently had investors who bet on opposing sides, characterizing the practice as ordinary on Wall Street and one that would have been known to a sophisticated investor like ACA. Tourre is standing alone as the defendant in the trial after his former firm, Goldman Sachs, settled with the SEC for $550 million in 2010. The trial, expected to last two to three weeks, opened July 15. Tourre took questions for about an hour and a half during which the SEC pressed him on technical points and on email communications about the transaction. He testified that he did not remember several of the communications. Tourre, a 34-year old Frenchman who became known as \"Fabulous Fab\" became a face of the Wall Street excesses that fomented the 2008 financial crisis. Tourre\'s testimony continues Thursday.