Tag Archives: “Why I Left Goldman Sachs”

A case of Wall Street greed gone too far

You hate paying taxes. I hate paying taxes. And the good folks at Goldman Sachs & Co. apparently hate paying taxes too. From my column this week for CNN.com:

“While the rest of us were donning our party clothes on New Year’s Eve, the legal worker bees at Goldman were pushing the send button on 10 regulatory filings to the Securities and Exchange Commission. By the time the ball dropped in Times Square, regulators had been notified that $65 million in Goldman stock had been granted a month early, helping a cluster of powerful multimillionaire executives trim their tax tab.”

Yes, I know. Can you blame them for taking perfectly legal means to avoid a bigger tax bill? Well, actually, yes.

“What makes the Goldman move distasteful is that it wasn’t even two months ago that CEO Blankfein was mouthing off in a Wall Street Journal op-ed that he endorsed tax increases “especially for the wealthiest” — along with a plug to cut entitlements to all you freeloaders out there.”

You can read my CNN column here.

Memo to former employees: Don’t mess with Goldman Sachs

Goldman Sachs’ most famous opinion writer did what no Goldman employee is supposed to do: He talked, very publicly, about his experience at the firm.

Greg Smith’s March 14 New York Times op-ed “Why I Am Leaving Goldman Sachs,” generated 3 million page views within 24 hours. The issues he brought up about how business is done at Goldman hit a chord with the public.

Now he’s written a book “Why I Left Goldman Sachs.” I reviewed it for Bloomberg today, and you can read the review here.

I have criticisms of “Why I Left.” Smith walks us through his 12 years at Goldman but doesn’t reflect on the fact that he himself was seduced by the firm and its much hyped culture of integrity and “customer first.”

And he doesn’t look at the current problems of Goldman and its competitors with a sense of history. Fraud, scandals, and conflicts of interest on Wall Street should be addressed, as Smith says, but they are nothing new. “Why I Left,” though, is mostly limited to the dozen years Smith was at the company and the “toxic” culture he observed at the end. I wonder if he understood that Goldman may not have been all it was cracked up to be in the first place.

That said, he’s getting creamed with criticisms I don’t think he deserves. The book was all hype and didn’t disclose anything illegal, goes one argument. Well, the author said “I don’t know of any illegal behavior” in that op-ed seven months ago, so why did his critics expect otherwise? My favorite Greg Smith bash is the argument that goes something like this: “He asked Goldman for a million-dollar bonus that he didn’t deserve.” Are we really supposed to be shocked at the notion of someone on Wall Street wanting to get paid more than they deserve?

Considering Smith’s out of work, maybe Goldman will consider him for its next FT/Goldman Sachs Business Book of the Year Award, which gives five-figure payments to authors who sometimes even write about brokerage firms. Talk about a conflict of interest.

Goldman’s counterattack has been over-the-top. The firm shared excerpts from Smith’s self-evaluations with Bloomberg, as well as documents that showed he was denied a raise and a promotion.

Did you know that your bosses could hand out information from your HR files if you tick them off? I’ll bet that looming threat is adding a whole new understanding of the firm’s culture of “collaboration, teamwork and integrity” with the troops at Goldman.

The book could have been better. The issues Smith raised are important even if they are age-old Wall Street problems. And the message from Smith’s former employer is loud and clear: Don’t mess with Goldman Sachs.