Goldman plans hiring spree to fix lapses after increased Fed scrutiny
A fresh bout of US regulatory scrutiny is setting off a hiring spree at Goldman Sachs Group as the company’s leaders seek to remediate issues raised by banking supervisors.
The Wall Street firm is enlisting several hundred new staffers to help address concerns from authorities including the Federal Reserve, according to people with knowledge of the matter, who asked not to be named discussing confidential plans. The back-office hiring binge comes even as the firm cuts executives from money-making ranks amid a slump in business.
The new hiring push is the first tangible fallout to emerge from regulators’ heightened interest in the firm. Reuters
“We are not permitted to comment on any supervisory matters related to our regulators,” a company spokesperson said in a statement. “Therefore we are not able to comment on these reports.”
A representative for the Fed declined to comment.
Though regulators routinely question large financial firms, Goldman executives privately describe growing pressure from the Fed over the past year. If left unsatisfied, supervisors can impose increasingly formal and potentially onerous measures behind the scenes to force banks to overhaul operations and procedures.
Many big financial firms contend with such actions out of view, but in more severe cases they can spiral into public orders. Goldman has been dealing with a confidential measure imposed by the Fed that predates the current increase in scrutiny, one person said. That may add to the pressure on managers to resolve concerns.
Unclear is what deficiencies the firm is seeking to address now that it has largely abandoned an effort to build out a consumer bank that was said to have set off questions from the Fed last year. The scrutiny has
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