The trial of Fabrice "Fabulous Fab" Tourre — a former Goldman Sachs trader who is accused of intentionally selling bad investments and making up terrible nicknames for himself — begins tomorrow.

The SEC announced fraud charges against Goldman and Tourre in 2010, but later allowed Goldman to settle for $550 million. Tourre is accused of devising Abacus 2007-AC1, a mortgage-backed securities bundle, in conjunction with hedge fund manager John Paulson, who made a fortune off of shorting the housing market. All in all, investors lost around $1 billion on the Abacus deal. The SEC alleges that Tourre misled his investors, hiding Paulson's involvement and allowing the hedge funder to benefit from the deal.

Judge Katherine Forrest, who is presiding over the case, has indicated that she will likely allow Tourre's personal emails into evidence. The emails, many of which became public in 2010, are the basis of the SEC's case and indicate that he was aware of how worthless mortgage-backed securities he was selling were.

One email read, "The whole building is about to collapse anytime now … 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 monstruosities [sic]!!!"

Another referred to collateralized-debt obligations (CDOs) as "a product of pure intellectual masturbation, the type of thing which you invent telling yourself: "Well, what if we created a 'thing', which has no purpose, which is absolutely conceptual and highly theoretical and which nobody knows how to price?") it sickens the heart to see it shot down in mid-flight ... it's a little like Frankenstein turning against his own inventor."

This will be the first fraud trial connected to the housing crash since the 2009 acquittal of Matthew Tannin and Ralph Cioffi of Bear Stearns. Apparently, Tourres' defense is being paid for by Goldman Sachs.

[NYT, image via AP]