Libya Fund Helps SEC in Goldman Investigation

Libya's sovereign-wealth fund said it is cooperating with the U.S. Securities and Exchange Commission in its ongoing investigation into Goldman Sachs Group Inc. (GS) over the securities firm's dealings with the fund when Col. Moammar Gadhafi was in power.

SocGen Deals Eyed by Libya

Officials working with Libya's new governing authority are examining whether any payments made by Société Générale SA as part of its business relationship with the Libyan Investment Authority ended up in the hands of people close to Col. Moammar Gadhafi's regime.

The French bank paid an unspecified amount to a Panama-registered company, Leinada Inc., to help structure and advise a $1 billion investment vehicle in 2008, according to deal-related documents reviewed by The Wall Street Journal. Leinada's exact role isn't clear, but the company's involvement was criticized by some officials at Libya's sovereign-wealth fund before fighting engulfed the country.

Goldman's Paperwork Flub

Goldman Sachs Group Inc. had no standard contracts in place to protect itself when it made $1.3 billion in options trades for Libya's sovereign-wealth fund controlled by Col. Moammar Gadhafi, according to people familiar with the situation.

While such contracts aren't required by law, they are routine operating procedure at banks and securities firms around the world when structuring derivatives transactions in opaque markets such as credit-default swaps, futures and options.