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Wall Street Whistleblower Tosses Bombshell

Wall Street Whistleblower Tosses Bombshell

A departing executive of Goldman Sachs investment bankers has tossed a bomb back at his former bosses and Wall Street in general.

In a seething op-ed for the New York Times, Greg Smith said that their rich clients were labelled ‘Muppets’ — meaning fools — and regularly ripped off and sold under-performing or bad investments.

The environment now is as toxic and destructive as I have ever seen it.

It’s purely about how we can make the most possible money off of them. If you were an alien from Mars and sat in on one of these meetings, you would believe that a client’s success or progress was not part of the thought process at all.

The Times says that the industry’s reaction to Smith’s revelations has been “one giant firm after another has publicly proclaimed it is putting clients first.”

On MSNBC, Michael Moore joked about the ’1%’ being ripped off by the ’0.01%’ and urged them to come join the Occupy movement.

On the Colbert Report, Stephen Colbert, the satirist who lampoons conservatives by playing one, compared Smith to Benedict Arnold, the Revolutionary War general who defected to the British Army and whose name became synonymous with betrayal.

In a British version of The Onion, the Daily Mash, the news was compared to Darth Vader quitting the empire:

The Empire today has become too much about shortcuts and not enough about remote strangulation. It just doesn’t feel right to me anymore.

Some are calling Smith a ‘whistleblower’ and — as has happened with others — Goldman Sacs were quick to label him just a ‘disgruntled employee.’ The financial media has openly mocked Smith, calling him ‘Judas’ and reporting anonymous attacks on him, quoting “people familiar with the matter” saying that Smith was angry with the size of his bonus and his lack of promotion.

But Smith’s revelations are already having real implications with attention drawn to Massachusetts Republican Senator Scott Brown’s attempts to weaken restrictions on the abuses Smith talks about. British MPs are saying Smith has reinforced the need for more banking reform. Speculation is rife that CEO Lloyd ‘I’m doing god’s work’ Blankfein may be forced to quit.

The widely respected BBC business editor, Robert Peston, wrote on Twitter:

This attack on Goldman Sachs from resigning exec is astonishing. The damage to the firm could be pretty serious.

Oh, and Goldman Sachs share price is dropping on the expectation of them losing non-’Muppet’ clients.

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86 comments

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1:10PM PDT on Mar 19, 2012

I wonder why when an employee spills the beans, he's disgruntled. Sometimes people realize that they start to feel like the devil's slave and no one can stand that feeling except corrupt, extremely greedy and destructive people. My great and grandparents have never trusted big banks and investors. I wonder why?? We all know that the poor man is telling the truth. You will try to discredit him, but remember people are very much aware of what is going on today, so the best you can do is SHUT UP and BE VERY QUIET!!!!

12:51PM PDT on Mar 19, 2012

We need all the whistle blowers we can get. There is no accountability for those who see themselves as our superiors.They need to be taught a terrible lesson.

3:26AM PDT on Mar 19, 2012

very good to know, excellent greg!
but wondering why care 2 has been consistently ignoring what is hapening in tibet?

The 30th Tibetan to set his body on fire....
http://www.phayul.com/news/article.aspx?id=31076&article=Thousands+protest+in+Rebkong%2c+Sonam+Dhargey+cremated

5:57PM PDT on Mar 18, 2012

Hopefully Goldman Sachs will come crashing down, for good.

2:41PM PDT on Mar 18, 2012

I hope more come out with video and recordings to blow their greedy asses out of the water!!

1:18PM PDT on Mar 18, 2012

There goes that Ethics and Responsibility problem again

1:17PM PDT on Mar 18, 2012

If this is new to anyone, than that, anyone, has no clue.

9:56AM PDT on Mar 18, 2012

The banking system definitely needs to be reformed.
Thanks for the good read Paul.

8:47AM PDT on Mar 18, 2012

Greg Smith is another American hero! Loved the quote from the Daily Mash.

8:03AM PDT on Mar 18, 2012

Anytime all the big guys gang up on an individual, we can be pretty sure that it is in defense of their own positions of power, and has nothing to do with us, except to distract us from the individual's message.

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