Aussie hedge fund manager Mapley calls Goldman product ‘a fraudulent concoction’.

The federal prosecutors investigating Goldman Sachs are focusing on Timberwolf, the infamously repeated scam cited in US Senate hearings last month.

The probe raises the possibility of criminal charges against the firm, already charged with civil fraud by the SEC.

Investigators from the U.S. Attorney’s office have been interviewing David Mapley at length, the former independent director of an Australian hedge fund. Mapley claims that the firm collapsed shortly after Goldman sold it $100 million of securities in Timberwolf, a rubbishy CDO.

In an interview with The Huffington Post Mapley confirmed having been contacted by the U.S. Attorney’s office. The Aussie brought his complaints about Goldman’s role in the deal to the SEC in December 2007, met with SEC lawyers several times in 2008 and told the Huff he continues to talk to them.

Among the most serious allegations, Mapley claims that Goldman sold Timberwolf securities to the fund at marked-up prices — while Goldman’s trading desk was busy shorting such CDOs tied to toxic subprime mortgage securities.

The Slog said some time back that Blankfein will not survive. This development more or less guarantees that happy outcome.

Associated stories on The Slog: Is Goldman’s O’Neill losing Midas touch?