NEW YORK — Goldman Sachs, arguably the most storied investment bank on Wall Street, has been compared to a money-sucking vampire squid and called the evil empire of finance. On Wednesday it got an entirely different kind of black eye — delivered by one of its own.
Greg Smith, an executive director at the bank, resigned with a blistering opinion column that accused the bank of losing its "moral fiber," putting profits ahead of customers' interests and dismissing customers as "muppets."
The decline of the bank's culture, he wrote, threatened the bank's survival after 143 years.
The stinging op-ed, "Why I Am Leaving Goldman Sachs," which appeared in The New York Times, was the talk of Wall Street and was widely circulated online.
Goldman swiftly issued a three-sentence statement disagreeing with Smith. "In our view," the bank said, "we will only be successful if our clients are successful. This fundamental truth lies at the heart of how we conduct ourselves."
Smith, identified by The Times as head of the company's United States equity derivatives business in Europe, the Middle East and Africa, wrote that he attended sales meetings in which helping clients make money was not part of the discussion.
Smith wrote that Goldman had devolved from a company he was proud to work for when he joined. He said the bank needs to "weed out the morally bankrupt people" and suggested that the erosion of Goldman's culture threatened its future.
Smith wrote that there are easy paths to becoming a leader at Goldman, including persuading clients to invest in products the company wants to get rid of or will bring the most profit to Goldman.
On Wall Street, the editorial may have been shocking in tone, but it was not surprising in content. Goldman's peers, even some of its customers, take its pursuit of profit as ordinary business.