Receive free Goldman Sachs Group updates
We’ll send you a myFT Daily Digest email rounding up the latest Goldman Sachs Group news every morning.
Goldman Sachs has fired several employees at its nascent corporate cash management business over what the Wall Street bank characterised as “serious violations” of its communications policies.
The firings are another example of a clampdown on Wall Street over employees’ communications. Banks including Goldman have paid hundreds of millions of dollars in fines over past breaches, including using unapproved messaging apps such as WhatsApp to conduct company business, risking a violation of government-mandated record-keeping practices.
In a memo to Goldman employees on Wednesday that was seen by the Financial Times, the bank told staff that “the firm terminated the employment of several leaders in the transaction banking (TxB) business after losing confidence in them following serious violations of firm policies”.
Four employees were fired, including Hari Moorthy, a partner at Goldman and global head of transaction banking, according to a person familiar with the matter. Day-to-day management of transaction banking will now be led by Philip Berlinski, Akila Raman and Luc Teboul.
Moorty did not immediately respond to a request for comment sent via LinkedIn. Goldman said in a statement it would not comment on individual disciplinary matters.
“As a general matter, we take our communications policy seriously, and we expect all of our personnel to comply with it,” the bank said, adding that Goldman “remains fully committed to our transaction banking business”.
The dismissals were reported earlier by Reuters.
Under Goldman’s communications policy, employees are required to communicate about firm-related business on communications channels that have been approved by the bank.
Transaction banking is one of Goldman’s new businesses, launched in 2020. It principally provides cash management services to corporate clients. It also provides banking infrastructure to fintech companies that do not have a US banking licence, but that side of the business has faced scrutiny from regulators, the FT reported last month.
Record-keeping on Wall Street has emerged as a big issue in recent years, after regulators uncovered banks’ failure to track thousands of texts and emails that were sent on personal phones or through unapproved apps.
Goldman was one of a group of banks last year that agreed to pay $200mn in fines to the US Securities and Exchange Commission and the Commodity Futures Trading Commission over record-keeping breaches.
Several banks now require employees to install Movius on their phones, an app that allows compliance staff to monitor calls, text messages and WhatsApp conversations with clients.
Read the full article here
