The cost of insuring Goldman Sachs’ debt against default has surged as Goldman’s regulatory woes take a toll on investors’ confidence, the Financial Times reported.

The risk ascribed to the bank by the derivatives markets has risen sharply following US regulators’ filing of civil fraud charges against Goldman Sachs last month.

Meawhile, Goldman Sachs has disclosed it has been sued by a number of shareholders since the Securities and Exchange Commission accused it of fraud over how the Wall Street firm sold collateralized debt obligation securities to investors.

The newspaper noted that the cost of insuring $10 million of Goldman Sachs’ debt using a five-year credit default swap is $162,000 a year, according to Markit, an 80 per cent rise from the level before the charges were announced.

In a regulatory filing, Goldman Sachs said the bank, its executives and directors faced seven legal actions related to the bank’s mortgage-related trading activities.

The lawsuits allege “breach of fiduciary duty, corporate waste, abuse of control, mismanagement and unjust enrichment”, the filing said.

Goldman Sachs is vigorously denying any wrongdoing over the CDO sale. It is accused of selling the investment products while simultaneously involving hedge fund manager John Paulson in choosing securities in the CDO package that he intended to short-sell. Paulson’s involvement was allegedly not disclosed to the CDO purchasers.

Lawyers have told this publication that the SEC action will spark lawsuits. Wealth managers have also said they expect to pick up Goldman Sachs clients concerned about the affair.