Ex-Goldman trader pleads guilty to wire fraud for bad $8.3B futures trade

A former trader at Goldman Sachs pleaded guilty Wednesday to wire fraud for concealing an $8.3 billion futures trade that was ten times larger than allowed by his business unit.

Matthew Taylor, 34, turned himself in and pleaded guilty to a single count of wire fraud for hiding the bad trade that lost the Wall Street bank $118.4 million.

"I am truly sorry," Taylor said at a hearing in Manhattan federal court Wednesday.

Taylor said he knew that it was wrong when he took the $8.3 billion position back in December 2007 but did it anyway to enhance his reputation and boost his personal profits.

According to the Associated Press, Taylor made $150,000 in salary and expected  $1.6 million in bonuses that year.

A source familiar with Goldman's equities trading business told Reuters that Taylor's position represented roughly 20 percent of e-mini trading volume on the Chicago Mercantile Exchange the day it was established.

The market moved against Taylor's position, leading to the $118 million loss, the source told Reuters.

Goldman Sachs fired Taylor after the loss but he moved on to a job as an equity derivatives trader with Morgan Stanley.

Goldman Sachs settled with the Commodities Futures Trading Commission for $1.5 million after being accused of not appropriately supervising traders. 

"We are very disappointed by Mr. Taylor's unauthorized conduct and betrayal of the firm's trust in him," the bank said in a statement on Wednesday.

If convicted, Taylor faces up to 20 years in prison. Sentencing is set for July 26.