Lance Auer, the New York Federal Reserve lead supervisor for Goldman Sachs, has sparked fears that he will reveal the bank’s secrets after he quit his job to advise other financial firms.
After it was announced that Auer would be moving to PwC, Goldman Sachs questioned him about whether he faced any restrictions if he wanted to work for other banks. Auer’s reply to these questions raised suspicions because he said that he had gained inside knowledge about how Goldman Sachs operated. “He had gleaned insights into operations and risk-management strategies that could be useful to competitors,” Bloomberg reported.
This situation emphasises the point made in recent complaints about how regulations that stop Federal Reserve examiners from sharing sensitive information are vague and difficult to monitor.
However PwC, which is also Goldman Sachs’s auditor, has assured the bank that its information will remain confidential. “PwC is committed to the highest ethical standards and requires that all new hires, including those previously employed by a regulator, abide by the confidentiality obligations arising out of their prior employment,” said Dan Ryan, head of the firm’s financial services advisory practice.
The recent growth in financial consulting has been due to the Dodd Frank regulation, which has led to an increase in bank stress testing. However, more complaints have been made by lenders about how stress tests reveal valuable information about what makes the larger banks successful.
Last year, Goldman Sachs fired two bankers after one of them allegedly shared confidential documents from the New York Federal Reserve within the firm. The other banker was terminated because they were suspected of leaking the information.
A study of UK chief financial officers (CFOs) by recruitment consultant Robert Half finds that most nurture ambitions to take over the chief executive’s role.
Urjut Patel has been named as the new governor of the Reserve Bank of India (RBI) and will succeed Raghuram Rajan, whose term ends on September 4.
Frank Vang-Jensen, who was appointed in March 2015, apparently went against the Swedish bank’s decentralised model.
The second global Women in Financial Services report finds slow progress for women leaders in financial services.