Former Goldman Sachs trader Fabrice Tourre, who was convicted of knowingly selling high-risk mortgage bonds as safe investments, has asked a US judge to cut his USD 910,000 fine to just USD 65,000.
Nicknamed "Fabulous Fab" in the financial world, Tourre became one of the most notorious media villains of the 2007 financial crisis.
Lawyers acting for the French trader argued in a New York court filing seen today that the fine far outstripped the estimated USD 175,000 the French banker earned from marketing the bonds.
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Other US courts have ruled that fines should not be greater than the earnings the guilty party is forced to give up, they argued, dubbing the penalty "unreasonably severe."
"The court may only penalize Mr Tourre for violations that were necessarily found by the jury," they argued.
And they added that the jury's finding was only "one second-tier violation, authorizing a maximum penalty of USD 65,000."
In addition, they argued, the New York jury that found Tourre guilty in August on Securities and Exchange Commission fraud charges did not find that his conduct was repeated over time.
The jury had judged Tourre liable on six of seven counts of fraud for misleading investors over the risk of the mortgage-linked securities Goldman sold to them in 2007.
The securities cratered after a housing bust, leaving the investors with large losses.
Earlier this month the judge rejected Tourre's request for a new trial.
His attorneys had argued that the evidence at trial did not support the jury's verdict, but the judge rejected that argument.
