The managers were fired for violating communications company policies.
(Photo: Reuters)
Frankfurt The US investment bank Goldman Sachs has separated from several executives due to violations of company policies. Those affected had violated the company’s policy, according to which employees are only allowed to comment on company matters through communication channels approved by the company, according to an internal memo that was available to the Reuters news agency on Wednesday.
The company did not name the affected employees in the memo. “We will not comment on individual disciplinary matters,” the Wall Street House said. But the bank expects all employees to strictly adhere to its internal communication rules.
Hari Moorthy, the head of transaction banking, had to leave the bank, reports the Reuters news agency, citing an insider. Accordingly, Philip Berlinski, the bank’s treasurer, will take over the day-to-day business of transaction banking together with Akila Raman and Luc Teboul.
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Berlinski will also temporarily lead the financial technology and consumer business. Moorthy is no longer listed as a registered broker on the website of the supervisory authority Finra.
Transaction banking is one of the businesses that Goldman is looking to expand to create more stable revenue and reduce its reliance on volatile investment banking. After two years of development, the cash management platform for companies TxB was launched in the USA in 2020, followed a year later by Great Britain and the EU in 2022. At the bank’s most recent investor day in February, CEO David Solomon emphasized that the division was already operating profitably and was only at the beginning of its development opportunities. In a recent statement, Goldman emphasizes that the bank remains fully behind the division.
High penalties for illegal WhatsApp messages
In recent years, US authorities have launched an offensive against violations of record keeping requirements. This involves bankers systematically exchanging business-relevant messages on their personal phones over private communication channels such as WhatsApp for years.
In September of last year, the futures market regulator CFTC and the Securities and Exchange Commission (SEC) imposed a total of $1.8 billion in penalties against eleven banks because their traders used unauthorized messaging apps. In addition to leading US institutions, Deutsche Bank and other European financial institutions were affected. Goldman had to pay around $200 million at the time. This August, the American authorities imposed further fines totaling $555 million against financial institutions such as Wells Fargo and the major French bank BNP Paribas.
The US supervisors’ justification was that the banks were unable to record all business-relevant messages due to the misconduct of their employees. However, there can be no exception to these regulations because in the event of allegations of misconduct, all of a company’s documents must be searchable.
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First publication: September 14, 2023, 3:29 a.m