Hedge Funds Politics & Regulation

John Paulson promises to shield investors from any legal fees related to ABACUS


Paulson assures investors that in the unlikely event of a lawsuit, the firm -- and not the investors -- will cover the legal bills.

Paulson & Co. informed clients on Wednesday that any litigation resulting from the Securities and Exchange Commission's suit against Goldman Sachs over the marketing of the collateralized debt obligation ABACUS 2007-AC1 would be borne by Paulson & Co. and not by the firm's investors. The letter followed a conference call earlier that day in which John Paulson assured investors that the firm had done nothing wrong. Here is the text of that letter, which AR obtained from an investor. (For background on the letter and the response from investors, please see Paulson: "We do operate in