Goldman Sachs introduced the "trading huddles" in 2006, allowing research analysts to meet on a weekly basis to share trading ideas with the firm's traders, who interfaced with clients, and, on occasion, equity salespersons.  Analysts would also discuss specific securities during trading huddles while they were considering changing the published research rating or the conviction list status of the security. In 2011, the Commonwealth of Massachusetts fined the firm $10 million for its unfair practices of disseminating material information on public companies.  In April 2012, the SEC and FINRA teamed up to fine Goldman Sachs a total of $22 million - which they'll split evenly.  Even so, having operated the trading huddles for over 5 years (started in 2006, and ended in 2011), Goldman probably made a windfall in commissions and trading profits as loyal institutional customers repaid the favor to its brokerage house. How The Privileged Few Gained. Goldman clients were not restricted from participating directly in the trading huddles and had access to the huddle information through research analysts' calls to certain of the firm's high priority clients.  These calls included discussions of the analysts' "most interesting and actionable ideas." To enhance the usefulness of its Trading Huddles, Goldman implemented a program in January 2007 known as the Asymmetric Service Initiative ("ASI"), through which it provided the information shared in a structured format in Trading Huddles to approximately 180 high priority clients selected by the Firm's institutional sales group ("ASI clients").  ASI clients were typically large hedge funds and other institutional investors.  As part of ASI, research analysts often prepared "huddle scripts" regarding the topics discussed at Trading Huddles and were instructed to work from the scripts when speaking to ASI clients. When making ASI calls, analysts were told to "lead with trading color . . . and with the most interesting and actionable ideas."  The Firm intended ASI,  among other things, to generate increased trading commissions from ASI clients.  The Firm did not disclose to its other clients  [C-I Note: Whom we'll call, for the moment, "mushrooms."] that it was providing the ASI service to its priority clients, but analysts were also permitted to discuss the ideas from Trading Huddles with non-ASI clients. Ultimately word got out that Goldman was holding these special, fact-filled sessions and that gave attendees and its most "privileged clients" a jump start on investments - as much as a day or 2 ahead of the rest of the world.  This probably was on or about 2011 - though for some reason I seem to recall it was many years earlier - in fact, if I'm not mistaken, the story appeared in the Sunday Times - Pages 1 and 2 of the Business Section. What perhaps is really surprising is the longevity of the practice.  And from articles that were recently written, Goldman had to know full well what it had and what it had violated the securities research rules.  This will be discussed  in another posting - probably on Friday, the 13th!!!! For further details - now, go to:  [Goldman AWC # 2009019301201] and [C-I's What Went Wrong Posting on the Goldman/SEC Settlement, 4/12/12]  and  [CNBC, 4/12/11].