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Discarded laptop is buried treasure in SEC fraud case

A discarded laptop found in the garbage has turned out to be a treasure trove of new information about the only lawsuit the SEC has brought over Wall Street’s mortgage debacle.
Image: Fabrice Tourre, Executive Director, Structured Products Group Trading for Goldman Sachs testifies during the U.S. Senate Homeland Security and Governmental Affairs Investigations Subcommittee hearing in Washington
Former Goldman Sachs trader Fabrice Tourre testifies during a U.S. Senate hearing last year. JIM YOUNG / Reuters file
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A discarded laptop found in the garbage has turned out to be a treasure trove of new information about the only lawsuit the Securities and Exchange Commission has brought over Wall Street’s mortgage securities debacle.

E-mails found on the laptop shed new light on Goldman Sachs trader Fabrice Tourre’s legal battle with the SEC over his involvement with highly controversial sales of mortgage securities, the New York Times said in an extensive report on Wednesday.

The report focused on how Tourre, who famously described himself in e-mails as the "fabulous Fab," has become the “face of mortgage-securities fraud” even as many question how a lone junior trader at Goldman Sachs could have been involved in such an allegedly extensive fraud without others at the firm knowing about it.

An equally intriguing question is how the laptop that was the source of much of the new information made its way into the hands of Times reporters Louise Story and Gretchen Morgenson.

According to the newspaper’s account, it got hold of non-public communications from Tourre’s lawyers to the SEC from a laptop provided by an artist and filmmaker in New York, Nancy Cohen (also known as Nancy Koan). Cohen says she found the materials in a laptop that a friend gave her in 2006.

According to the Times, that unidentified friend told Cohen he stumbled upon the laptop in a garbage area in a downtown New York apartment building.

“E-mail messages for Mr. Tourre continued streaming into the device, but Ms. Cohen said she had ignored them until she heard Mr. Tourre’s name in news reports about the SEC case," the Times reported. "She then provided the material to The Times."

Cohen actually had the laptop for several years before Tourre's name first turned up on the front page of newspapers in connection with the mortgage fraud case.

“She said, where have I heard that name? Oh, yeah, it’s on the welcome screen of my computer,” said Curtis Ellis, a political consultant and friend of Cohen's who said he was enlisted to help the artist deal with a deluge of media calls Wednesday.

Cohen went to “a number of people” with the story, and the Times was the first to call back, Ellis told

“What a curse this has been for her," Ellis said. "This is not her dream come true, but she felt it was her duty to share this information.”

He said the laptop really was pulled from the garbage and was not protected by a password. Messages to Tourre apparently continued to stream into the laptop's e-mail program.

Ellis wouldn’t comment on how the information was given to the Times reporters, but said that they do not currently have the laptop.

Ellis, who managed the losing campaign of Tea Party candidate Jack Davis in the recent special election for New York's 26th Congressional District, laughed off conspiracy theories about Cohen hacking into Tourre’s e-mail.

“This is a woman that needs help getting into her own e-mail account,” he said.

The Times also denied hacking into Tourre's e-mail account.

“As we disclosed in our story, certain documents were provided to us by a named source," the Times said in a statement. "The Times did not ‘hack’ any e-mail accounts or ask anyone to do so. We are confident that our receipt and use of those documents was in keeping with our journalistic standards and complied with the law.”

Tourre’s lawyer did not respond to a request for comment, the Times said.