The embarrassing tongue-lashing Goldman Sachs (GS) received this week from a former employee in the Op-Ed pages of The New York Times seemingly presents a unique opportunity for the Wall Street firm’s rivals.
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Yet bankers at JPMorgan Chase (JPM) have been warned not to seize upon so-called Muppetgate, which erupted after a former Goldman employee resigned and bashed Goldman as a “toxic” place to work full of self-interested people.
According to Reuters, JPMorgan CEO Jamie Dimon warned employees in an internal memo not to try to take advantage of the “alleged” issues raised by the Op-Ed written by Greg Smith.
“I want to be clear that I don't want anyone here to seek advantage from a competitor's alleged issues or hearsay -- ever. It's not the way we do business,” Dimon wrote in the memo, the news service reported.
The Dimon memo, which urged workers to focus on the company’s own standards, greeted Asian employees as they arrived for work Thursday morning and was later forwarded to wider parts of the business, Reuters reported.
“I want to be clear that I don't want anyone here to seek advantage from a competitor's alleged issues or hearsay -- ever. It's not the way we do business."
“I can honestly say that the environment now is as toxic and destructive as I have ever seen it,” Smith wrote in the Times Op-Ed. “I knew it was time to leave when I realized I could no longer look students in the eye and tell them what a great place this was to work.”
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Smith also said he had seen five different managing directors refer to their own clients as "muppets."
Smith said he was stepping down as executive director and head of the bank’s U.S. equity derivative business in Europe, the Middle East and Africa, though Goldman said his title was simply vice president and he led a division of one.
Responding to the enormous amount of attention the Op-Ed received, Goldman sought to portray Smith as disgruntled and rejected the premise of his letter.
“We disagree with the views expressed, which we don’t think reflect the way we run our business,” a spokesperson said. “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.”
While Goldman is no stranger to negative publicity, the Smith letter stood out as an extremely rare example of public criticism of the firm from an employee.
After sinking more than 3% the day before, Goldman’s shares inched up 0.12% to $120.54 Thursday morning, leaving them up about 33% so far this year. JPMorgan shares were recently off 1.01% to $43.14.