Corruption in banking has become so commonplace that it no longer surprises us. We have become inured to fraud because government, the DoJ and other leaders have become blase about the unscrupulous behavior of bankers, about foreclosure fraud, about forgery, about accounting control fraud and all manner of unethical and fraudulent behavior by banks. Mr. Smith represents a lone individual standing up for truth against a powerful institution and he should be given praise for his decency, his honesty and his high principles--attributes which are sorely lacking at Goldman Sachs.
Fmr. Goldman Sachs employee Greg Smith: 'I want to advocate loudly for financial reform'
Interview by Soledad O'Brien - CNN
Goldman Sachs has been getting a string of bad publicity recently, with former Goldman board member Rajat Gupta being sentenced to two years in prison for insider trading. And in March, London executive Greg Smith resigned in an op-ed in The New York Times, where he accused the company of corruption.Smith, who started as an intern at the firm in 2000, worked him way up to a position as a vice president before ending his 12-year career in spectacular fashion. His subsequent tell-all book, “Why I Left Goldman Sachs: A Wall Street Story” comes out this week. Greg Smith comes to “Starting Point” with more on his story.
Smith sheds light on some of the practices at Goldman Sachs and why left. “At Goldman Sachs, there’s a term a called an ‘elephant trade,’ which is when you make $1 million dollars or more on one single piece of business on one hit,” Smith describes. “And the mentality is purely about ‘eat what you kill’, getting big business.”
Smith opens up about what the bankers target in these elephant trades. “The easiest big business comes from unsophisticated investors, which is very frequently a teacher’s retirement fund, philanthropy, a charity, a university endowment. And if banks were forced to make their earnings transparent, and show who they made money from and how they made it, people would be outraged, frankly.”
Read about the interview and see the video here