Goldman trader Fabrice Tourre's trial begins 15 July 2013 Last updated at 15:55 Fabrice Tourre says he "categorically denies" any wrongdoing A former Goldman Sachs trader has gone on trial in New York to face charges that he defrauded investors. The civil case against Fabrice Tourre, 34, is being brought by the US Securities and Exchange Commission. The disclosure two years ago of emails from Mr Tourre, who denies the charges, sparked widespread debate about Wall Street's role in the financial crisis. It also implicated billionaire investor John Paulson and led to Goldman paying $550m (£365m) to settle an SEC lawsuit. Jury selection for the closely watched trial began in a lower Manhattan court today. The case against the man nicknamed Fabulous Fab is one of the most high-profile trials to date stemming from the SEC's investigations into the run-up to the 2008 financial crisis. Bet on failure The case revolves around a portfolio of sub-prime mortgage investments called Abacus, which Mr Tourre worked on. When the portfolio of assets was being marketed, it is alleged that investors were not told that Mr Paulson, a high-profile hedge fund manager, had an involvement. The SEC says Mr Paulson helped pick assets for the Abacus portfolio. But he then bet the investments would fail, taking out an insurance product called a credit default swap. The SEC's case was summed up by US District Judge Katherine Forrest last month. She said that Mr Tourre "handed Little Red Riding Hood an invitation to grandmother's house while concealing the fact that it was written by the Big Bad Wolf." The SEC says the wolf in question is John Paulson. The SEC said Abacus's marketing materials failed to disclose Mr Paulson's role in picking the underlying assets, instead saying that a subsidiary of ACA Capital Holdings selected them. Exotic trades In a much-cited email sent to his girlfriend on 23 January 2007, Mr Tourre said of the financial markets that the "whole building is about to collapse anytime now." He continued: "Only potential survivor, the Fabulous Fab... standing in the middle of all these complex, highly leveraged, exotic trades he created without necessarily understanding all of the implications of those monstrosities!!!" When the underlying mortgage securities failed, investors including IKB Deutsche Industriebank and ABN Amro Bank, now owned by Royal Bank of Scotland Group, lost more than $1bn, the SEC said. Mr Paulson, meanwhile, made about $1bn, the SEC said. In a statement Mr Tourre's lawyers said that he is "confident that when all the evidence is considered, the jury will soundly reject the SEC's charges." It is expected that Mr Tourre, who has left Goldman and is studying economics at the University of Chicago, will argue that the Abacus marketing documents contained all the information investors might need. Sophisticated investors like IKB had the knowledge to make decisions, his lawyers are likely to claim.