Goldman Sachs Furious over Revelation that they ripped off Charities

[Ichingcarpenter]

Goldman Furious Over Our Posting Insider's Confession About Ripping Off Non-Profits


A Goldman Sachs trader recently told me that he constantly rips off endowments, charities, and foundations when they would call up and want to invest. "Whenever I hear it's a non-prof, then you just ladle on the extra fees," he told me.

That's because he knew they were usually unsophisticated investors and wouldn't do comparison shopping or know how to properly analyze a fee schedule. He justified it by saying it was, "their fault... when you only call up one place, what do you expect?"

To some extent he's right. If you don't shop around for your investments or learn to how to make sure you're getting the best deal, you do set yourself up to be taken advantage of. If you're getting into an actively managed fund, you better learn all about fees, loads, 12b1 fees, marketing fees, transaction fees, all the fees in the fee rainbow. Don't think that because you're a non-profit all of a sudden everyone puts on their happy hats and kid gloves and is going to help you out.

And if you manage the investing on behalf of a non-profit, endowment, foundation or charity, and have an account with Goldman, or any brokerage for that matter, and you're not 100% certain you understand all the fees on your investment, now would be a great time to check them out.

Here is the lovenote sent by Melissa Daly, VP of Corporate Communications:

Dear Ben,

Today's column on fees cannot go unchallenged. You make a number of assertions based on a conversation you claim to have had with a Goldman Sachs trader. Firstly, the comments you attribute to this person in no way reflect our values or the way in which we conduct business. You should also know that endowments, foundations, charities and non-profit organizations often have their own in-house professional investment staff and are among the most sophisticated investors. To claim otherwise suggests a total lack of experience servicing this or any type of client and betrays a total lack of knowledge of how we structure fees. The headline you extrapolate from this conversation is as fallacious as it is offensive.

Sincerely,

Melissa Daly
Vice President
Corporate Communications
Goldman, Sachs & Co.

http://consumerist.com/5084208/goldman-furious-over-our-posting-insiders-confession-about-ripping-off-non+profits

[Phred42]

1. Congrats!

[The Backlash Cometh]

2. How does this "blaming the victim" square with their advertisement?

[gratuitous]

3. My, Ms. Daly is certainly upset about the column

Unfortunately, in her little missive to the writer, she doesn't quite see her way clear to actually denying that Goldman Sachs does indeed "ladle on the extra fees" for some of their clients. But, as always in the world of high finance, if you get suckered, it's your own fault. Unless you're too big to fail. Then it's everyone else's fault.

[natrat]

4. idiots all the way around

idiots for trusting anyone on wall street
idiots who have left their pensions with these unsophisticated trustees
idiots for not understanding the point of wall street-to separate you from your money

[AllyCat]

5. Again, they aren't sorry they did it, just sorry they got caught.

And the people keep venerating these bastards.

[wroberts189]

6. dirty rotten scoundrels... stealing from the most needy

"need to comparison shop" my ass.

go ahead ..justify it like that... it won't work. There are laws against this.

And you had better not meet up with Jesus.

[anigbrowl]

7. It's the columnist that says that, not GS

I'm not very persuaded by the original report.

[wroberts189]

10. Ummm... what??? A GS trader is clearly quoted.

You saying the article is not true? They just committed libel against a megabank?


"A Goldman Sachs trader recently told me that he constantly rips off endowments, charities, and foundations when they would call up and want to invest. "Whenever I hear it's a non-prof, then you just ladle on the extra fees," he told me."

[RaleighNCDUer]

8. Gee, who do we believe?

That actual trader, or the PR flack?

[Joe Chi Minh]

9. Don't be nasty and incisive!

[myrna minx]

11. I loathe these bastards.

:grr: