Washington, D.C. ? The U.S. attorney’s office in Manhattan is conducting a criminal investigation of Goldman Sachs over mortgage securities deals the big Wall Street firm arranged, a knowledgeable person said Thursday.

The person said the probe stems from a criminal referral by the Securities and Exchange Commission. The source spoke on condition of anonymity because the inquiry is in a preliminary phase.

The SEC earlier this month filed civil fraud charges against Goldman and a trader in connection with the transactions in 2006 and 2007.

The agency alleged the firm misled investors by failing to tell them the subprime mortgage securities had been chosen with help from a Goldman hedge fund client, Paulson & Co., that was betting the investments would fail. Goldman has denied the charges and said it will contest them in court.