Goldman puts an end to accounts for staffers with less than $1 million
Goldman Sachs has automatically provided brokerage accounts to its employees, that is, until now. The firm has informed most of its current and former employees who have less than $1 million in their accounts that they must be moved somewhere else before the end of 2014. Therefore, any employee who is not considered a millionaire will see his or her account sent to another brokerage firm.
Previously, regardless of whether your salary at Goldman Sachs was $60,000 or in the millions, you were provided with the same banking privileges as any other employee or as any client. The policy had remained the same after leaving the company or retiring. According to reports, the move has angered some Goldman employees as well as retirees because they felt the perk was a sign that the company was taking care of its own and believed they would have that benefit as long as they wanted to keep it.
Clients have larger accounts
However, when you look at the firm’s client base, the account figures are much higher. Goldman’s asset management division’s individual clients have accounts valued of at least $10 million. Besides providing employees with a perk, the previous arrangement helped Goldman to monitor employee investments for compliance reasons. But the firm has reached the conclusion that it could hire an outside firm to broker the accounts while still meeting the compliance requirements.
Accounts to be moved to Fidelity Investments
Employees who do not meet the $1 million minimum requirement will have their accounts transferred to Fidelity Investments. Former employees can move accounts to wherever they choose to locate them. The new policy only pertains to U.S. employees.
In a statement, Goldman said, “This ensures these current and former employees receive the right tools and services.”
Other Goldman perks of the past
Goldman has long helped its employees with their personal finances. For years, Goldman partners could have their taxes prepared by accountants with the firm, and some employees even got home mortgages through special arrangements with the firm. The financial benefits were often extended to even the company’s lower-level employees. In 1999, all employees were given shares in the firm’s initial public offering. However, the company had 13,000 employees in 1999 and now has 30,000 employees, which could have an impact on the reduction of benefits or perks given to Goldman Sachs employees.