Goldman Sachs in Hot Water Again
April 18, 2012
Info sharing the MBA way: The Washington Post announces that “Goldman Fined $22M for ‘Willfully’ Violating Law on Information-Sharing, SEC Says.” Apparently, the SEC had a problem with the weekly “huddles” with favored clients that Goldman Sachs held from 2006 to 2011. The article reveals:
“The agency did not accuse Goldman of insider trading, but it essentially said the firm created an environment in which systematic trading based on advance information could have gone unchecked. In this case, the information was the ‘buy’ or ‘sell’ recommendations and other stock analysis by the firm’s own employees. “Goldman agreed to pay a $22 million penalty to settle the agency’s administrative case and a parallel action by the Financial Industry Regulatory Authority (Finra), an industry self-regulatory group. Goldman also agreed to be censured and to change its policies and procedures, the SEC said.”
Well, that ought to do it; I’m sure the firm has learned its lesson.
Finished laughing? In fact, Goldman has faced plenty of these measly (to them) fines for missteps, and it just keeps stepping. In this case, though, the announcement comes on the heels of the bad press caused by former employee Greg Smith’s resignation statement he had published in the New York Times. (If you haven’t read it yet, check it out here. It’s a doozy.) Will the timing matter?
Goldman Sachs keeps finding itself in hot water, but don’t worry. I’m sure its executives will be just fine in their insulated golden life rafts. I wonder if MBAs know what the buoyancy of golden life vest is.
Cynthia Murrell, April 18, 2012
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