Goldman

The guys at Goldman are just weasels.b Stay far, far away from anything that they have anything at all to do with -- they misrepresent as a matter of ordinary business, you can't trust anything they touch at face value.

LONDON (AP) -- The practice wasn't secret and it wasn't illegal, and some of it happened 10 or 15 years ago. But the practice of European governments reportedly using complex financial transactions to move debt off their books is getting closer attention from markets and the European Union.

The deals, known as swaps, let some governments shrink the apparent size of their debts, unsettling news at a time when markets are taking stock of Europe's struggle with rising budget deficits.

Greece has until Friday to disclose to the European Commission how it used complex currency swap deals and whether they were used to conceal the real scale of its debt -- specifically a 2001 deal that Greek officials said they did with U.S. investment bank Goldman Sachs.

Under the deal, known as a currency swap, Greek dollar and yen debt was reportedly exchanged for euro debt for a period at an advantageous rate to be reversed at a later date. The effect was to show less debt in the near-term.

The deals carry some of the hallmarks of the financial crisis -- such as off-balance sheet liabilities and highly complex financial arrangements.

Christine Lagarde, France's finance minister, said the EU statistics agency Eurostat would examine how Goldman Sachs ''helped Greece structure, postpone a certain number of debt repayments.''

''You have to know first of all whether it was doctoring the accounts and if this was legal or not at the time it was done, and if it was legal, it will be necessary to find out whether it was favorable for stability. Probably not. And in that case, how we can avoid a repeat, if those measures already were taken,''

Greece wasn't necessarily doing anything new -- Italy did something similar in the 1990s while Belgium has also been mentioned by analysts as using financial derivatives to improved its reported fiscal position.

Professor Gustavo Piga of the University of Rome has warned for years that more and more governments were using the complex financial instruments that mushroomed during the 1990s.

Piga is amazed that in the nine years since he wrote an analysis about the growing involvement of governments in the derivatives markets that no one at the European Central Bank or Eurostat, the EU's statistics office -- even journalists -- got in touch with him to discuss his findings.

However, he hopes that the current concern surrounding Greece's deal with Goldman Sachs finally triggers belated reforms of this opaque practice.

Piga told The Associated Press that governments should not be banned from using trading in complex financial instruments as part of their debt management -- he said Sweden and Denmark appear to have done so in according with good practice. But such deals should be more transparent and comply with accounting standards.

''The scandal needs fixing; it was never done before but I hope it will be now,'' said Piga. ''This creates further confusion about the state of the accounts and investors will be asking higher risk premia as things start to unravel again.''