The Securities and Exchange Commission is launching a less-than-airtight case against Goldman Sachs (NYSE:GS) because the firm thrived as the economy tanked, former Goldman chief Jon Corzine told investment managers in Washington D.C., Wednesday evening.

"Goldman Sachs, because it's been as successful as it has been, seems to have been a proxy for the whole industry," Corzine said at an annual conference being held by the Investment Company Institute, the national trade association of the mutual fund industry.

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Corzine headed Goldman Sachs in the mid-1990s before being ousted amid internal political strife. He was also recently ousted as the Democratic governor or New Jersey amid a failed reelection bid.

The former Goldman boss expressed confidence that his former employer would emerge from its current difficulties relatively unscathed. "I still believe that Goldman Sachs is an outstanding institution...that will self-correct the things that may or may not have gone wrong."

The SEC has accused Goldman and one of its employees of civil fraud for allegedly failing to disclose to clients that mortgage-security products the firm created had been designed with the help of a bearish hedge fund manager, John Paulson of Paulson & Co. (Learn more in The Goldman Sachs Fraud Explained.)

Critics have charged that the SEC's case is a politically motivated bid to whip up political support for financial reform legislation supported by President Obama and Congressional Democratic leaders, including Sen. Christopher Dodd, D-Conn. Goldman may have become a lightning rod because of its success in navigating a financial crisis that destroyed leading rivals Bear Stearns (now a part of JPMorgan Chase (NYSE:JPM)) and Lehman Bros. (now owned by Barclays PLC (NYSE:BCS)). New York-based Goldman Sachs posted a banner first quarter, earning $3.3 billion.

During his remarks Wednesday Corzine also offered some advice for investment companies that may be lobbying against the various financial reform bills wending their way through Congress. "Take what's on the table and run, because if there's another crisis..." Corzine said, his voice trailing off. "There are more good things in this bill than bad."

Addressing the conference after Corzine was Trent Lott, the former Mississippi senator and Republican majority leader, who is now working as lobbyist. Lott said the current lack of bipartisanship on Capitol Hill could spell a protracted fight over financial reform legislation.

"You know you have a problem with legislation when the middle ground is represented by Barney Frank," he quipped, referring to the veteran Massachusetts Democrat who chairs the House Financial Services Committee.

Lott largely blames President Obama for the partisan acrimony that is slowing the financial reform initiative. He suggested the president improve the political climate by learning to become "more pliable" toward the GOP's Congressional leaders. "But I don't think ‘Rahmbo' or Ax would allow it," he said, using the Beltway nicknames for White House Chief of Staff Rahm Emanuel and key Obama advisor David Axelrod.

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