A Goldman Sachs vice president resigned from his London job today by way of an an op-ed piece in the New York Times which some some commentators called a "public relations disaster" for the firm.
The executive, Greg Smith, called the firm's culture "toxic and destructive." He said he was he was resigning after 12 years because of a shift in the firm's culture that allegedly puts profits ahead of client interests.
Goldman executives, said Smith, talk openly about ripping off their clients, who he said sometimes are referred to internally as "muppets."
He wrote: "It makes me ill how callously people talk about ripping their clients off."
Mr. Smith, who described himself as executive director and head of the firm's U.S. equity derivatives business in Europe, the Middle East and Africa—blamed the firm's leadership.
"When the history books are written about Goldman Sachs, they may reflect that the current chief executive officer, Lloyd C. Blankfein, and the president, Gary D. Cohn, lost hold of the firm's culture on their watch.
"I truly believe that this decline in the firm's moral fiber represents the single most serious threat to its long-run survival."
Goldman Sachs swiftly hit back.
A Goldman spokeswoman said. "We disagree with the views expressed, which we don't think reflect the way we run our business."
"In our view, we will only be successful if our clients are successful. This fundamental truth lies at the heart of how we conduct ourselves."
When Goldman gave out annual bonuses earlier this year, Smith's small payment became a point of friction, said the Wall Street Journal, quoting people familiar with the matter.
Within hours, said the New York Times, the public resignation letter had sparked a storm of comment on the Web and Twitter, with some calling it a “must read” and others a “public relations disaster.”
For the full op-ed piece follow the link below.