Why I Am Leaving Goldman Sachs

There is a remarkable letter in the New York Times from Greg Smith (executive director and head of the Goldman Sachs United States equity derivatives business in Europe, the Middle East and Africa) who, after 12 years, is leaving Goldman Sachs and has penned his reasons why.

Seemingly the motive of making money at the client's expense (apparently this was not the culture of the firm 12 years ago, or at least Smith claims not to have seen it then) has turned him against Goldman Sachs.

Additionally, he was irked by the fact that Goldman employees allegedly would refer to their clients as "muppets" (I understand that Kermit, Miss Piggy et al are considering legal action against Goldman's for this alleged slur).

As regards Smith's career in Goldman's, his CV (or Resume as it is called in the USA) is proving to be a little hard to track down on the web (here is his Facebook page) aside from this entry on Find The Best:

Professional Bio
Advisor Name	Gregory Smith
Individual CRD #	4438607
Registered Titles	Broker-Dealer Agent
Firm	Goldman, Sachs & Co. Compare Goldman, Sachs & Co. Financial Advisors
Current Office Employment Dates	1/1/11 - Present
Firm CRD #	361
State Registrations	Alaska California Colorado Florida Georgia Kentucky Maine Maryland Michigan Missouri Nevada New Jersey Tennessee Texas Utah Vermont West Virginia
Independent Contractor	No
Work History
Firm City State Start Date End Date Goldman, Sachs & Co. New York NY 12/1/02 1/1/11 Goldman, Sachs & Co. New York NY 1/1/11 Goldman, Sachs & Co. New York NY 1/1/11 Present
*Please note that the IAR is required to provide this information only while registered with an investment advisor firm and the information is not updated through Form U4 after the IAR ceases to be registered. Therefore, an employment end date of
Financial Exams
Exam Date Exam Code Grade 12/30/02 Series 3 Passed 10/26/06 Series 55 Passed 10/17/01 Series 63 Passed 10/9/01 Series 7 Passed

It is possible that he had something to do with Goldman's debacle in Libya (given that he had responsibility for the Middle East):

"In early 2008, according to interviews and an internal document review conducted by The Wall Street Journal, Libya's sovereign wealth fund invested $1.3 billion in stock and currency options with Goldman, only to watch as the investments shrunk to a measly $25.1 million--that's two percent of the initial value, for those keeping score--as the credit crisis hit. 

A Libyan official was so furious with the bank during one meeting in Tripoli that Goldman officials hired a security guard to protect them before they left Libya, consulted Goldman chief Lloyd Blankfein (above, on right) about how to mend the relationship, and offered Libya the opportunity to become one of Goldman's biggest shareholders by investing $3.7 billion in preferred shares or corporate debt. 

The negotiations eventually collapsed, the Journal adds, but the episode is emblematic of a period of several years when Goldman and other Western banks rushed to do business with Libya after the U.S. decided to lift its sanctions against the country in 2004. That period, of course, is now history."

Maybe not, for the Wall Street Journal notes the following:

"Mr. Smith described himself as an executive director and head of Goldman’s U.S. equity derivatives business in Europe, the Middle East and Africa.

A person familiar with the matter said Mr. Smith’s role is actually vice president, a relatively junior position held by thousands of Goldman employees around the world. And Mr. Smith is the only employee in the derivatives business that he heads, this person said."

Whatever Smith's actual role in Goldman's, and as to whether he finds himself sued by Goldman Sachs for this extraordinary public outburst remains to be seen. In the meantime Goldman are now including 3 year non-disparagement clauses in all termination agreements (if they can get this by the lawyers, these will be retrospective).