Throughout the week over at Securities Docket I highlight the most interesting columns and blog posts from around the web on the subjects of SEC enforcement and securities litigation. Here is a digest of my picks for the week ending July 12, 2013.

Four Things to Look for in “Fabulous Fab” Trial

Jan Wolfe, The Litigation Daily

A jury trial kicks off on Monday in the U.S. Securities and Exchange Commission's fraud case against Fabrice Tourre, the only Goldman Sachs & Co employee directly targeted by the agency in wake of the financial crisis. Tourre, you'll recall, is a 34-year-old former trader who marketed an ill-fated collateralized debt obligation known as ABACUS 2007-AC1 to Goldman clients. According to the SEC's complaint, filed in 2010, Tourre failed to tell investors that the CDO was assembled by the hedge fund Paulson & Co., which helped select the underlying securities and then took a “short position” against the CDO, essentially betting it would fail. Because Goldman Sachs settled parallel charges without admitting wrongdoing back in 2010, the jury's eventual verdict will inevitably be seen as a referendum on the bank's culpability for the financial crisis. Here are four things to look for as the three-week trial unfolds.

S.E.C. Hopes for Validation in Goldman Trader Case

Ben Protess and Susanne Craig, The New York Times

The rarity of the trial underpins its importance. For Mr. Tourre, who is now enrolled in a doctoral economics program at the University of Chicago, an unfavorable verdict could yield a fine, or worse, a ban from the securities industry. A victory in court, however, would offer only belated consolation to Goldman, which is paying for his defense. For the S.E.C., an agency still dogged by its failure to thwart the crisis, the trial is a defining moment that follows one courtroom disappointment after another.

The SEC's New ‘Admit Liability' Policy Will Hurt Everyone Except Plaintiff Lawyers

Gregory J. Wallance, Forbes

It's hard to argue with a regulatory agency seeking more flexible penalties for carrying out a regulatory mandate. But the approval with which SEC watchers generally greeted the policy may be premature, for it's not likely to further SEC enforcement objectives. On the one hand,  this may little more than a cosmetically deft finesse of all the judicial and political pressure on the SEC to achieve better results in enforcement actions, especially those arising from the 2008 financial system collapse. If so, as even the SEC has suggested, most companies will continue to settle using the standard neither-admit-nor-deny formula, and the SEC's enforcement business will continue to be done pretty much as usual.  But on the other hand, if the SEC requires more than a token number of companies to admit liability, the winners will not be the investing public but plaintiff class action lawyers.

Insider Trading: Bad, But Not the Real Scourge of Wall Street

Charles Gasparino, TIME.com

The financial crisis and its continued lack of identifiable culprits is key to understanding why insider trading is all the rage these days with the federal law enforcement bureaucracy, and why men who run hedge funds, like Raj Rajaratnam and Steve Cohen, have become more recognizable household names than those of our banking titans. Of course, bubbles like the one that caused the risk-taking that led to the 2008 collapse are often more about irrational exuberance than the more rational act of fraud. In other words, they are difficult cases to make, and upon taking office in 2009, and with the after-effect of the financial crisis causing massive unemployment, regulatory officials in the Obama administration barely explained those nuances to a skeptical and hurting American public.

What it needed was a white-collar scandal that it could tout as having successfully prosecuted to satisfy the public's demand for Wall Street scalps, even though insider trading had nothing to do with the practices that led to the banking debacle.

Is the Case Against SAC's Steven Cohen Falling Apart?

Sheelah Kolhatkar, Businessweek

An appeals court ruled on June 18 that two convicted hedge-fund traders, Anthony Chiasson of Level Global Investors and Todd Newman of Diamondback Capital Management, could remain out of prison as they appeal their convictions. The ruling was heartening to the two men, both of whom are facing long separations from their families. But within the U.S. Attorney's Office and the Securities and Exchange Commission, the decision triggered something akin to a mass anxiety attack, as it casts uncertainty on some of the strongest potential legal avenues the government has to charge SAC Capital founder Steven Cohen.