Goldman Sachs Group Inc. fired transaction banking executives including the head of the business, Hari Moorthy, over compliance lapses, a person with direct knowledge of the matter said.
(Bloomberg) — Goldman Sachs Group Inc. fired transaction banking executives including the head of the business, Hari Moorthy, over compliance lapses, a person with direct knowledge of the matter said.
The Wall Street firm terminated several leaders of the unit who communicated on unauthorized channels and didn’t comply with an internal review, according to a memo to employees seen by Bloomberg. Moorthy, who isn’t named in the memo, didn’t immediately respond to messages seeking comment.
“We are not going to comment on individual disciplinary matters. As a general matter, we take our communications policy seriously, and we expect all of our personnel to comply with it,” the bank said in a statement. “Goldman Sachs remains fully committed to our transaction banking business.”
The abrupt ousters hit a unit that Goldman has been working hard to grow, as it looks to soak up more corporate deposits and generate steady fees. At an investor day in February, Chief Executive Officer David Solomon said the young business — already profitable — is just at the beginning of its potential to deliver more for the company.
Wall Street banks are under heavy pressure to police employees’ communications following a US crackdown on the industry’s widespread use of WhatsApp and other unauthorized platforms. Federal rules require firms to monitor and archive all work-related messages. Goldman was one of several banks that regulators slapped with fines of $200 million apiece last year.
In recent months, the transaction banking unit has also faced Federal Reserve scrutiny that previously focused on the company’s oversight of consumer banking. The dismissals are unrelated to those inquiries, the person with knowledge of the matter said.
Read more: Wall Street hit with $2 billion of fines in WhatsApp probe
The internal memo, written by Goldman Treasurer Philip Berlinski, reminds employees of their duty to comply with rules and to report any concerns. Berlinski said he will oversee the business with Akila Raman and Luc Teboul, and that the company is staunchly committed to its continued growth.
(Updates with background on unit from fourth paragraph.)
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