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Seeking Clarity On Goldman's Ethics Waiver
With daily geopolitical, natural resource and sovereign liquidity crises suddenly becoming the norm, it is easy to get sidetracked from other very important issues, in which, at least until recently, moderate progress had been achieved. Primary among these is the seeming disconnect (at least when compared to other banks such as Bear Stearns and Lehman Brothers) in the preferential treatment of Goldman Sachs. Now that Goldman is a household name, courtesy of a variety of litigation overtures, both in the civil and criminal arena, demonstrated by Goldman's popularity among the broader population, the firm has been kind enough to publicize its "Code of Business Conduct and Ethics" in an attempt to placate the concerned populace, and demonstrate that Goldman has a whopping 4 pages dedicated to promoting legal behavior amongst its nearly 30,000 employees. What confuses us is the placement at the very end of this document of the following section, Waivers of This Code, in which one reads: "From time to time, the firm may waive certain provisions of this Code." In other words, Goldman's activities comply fully with legality until such time that Goldman decides it is in the name of the greater good to "waive" this compliance. We are confused that in light of this glaring loophole, not one question has been asked of Mr. Blankfein as to what specific circumstances have necessitated the invocation of the "ethics waiver", by either executive and non-executive employees: something which none other than former Goldman CEO Hank Paulson recently used in order to pursue the full taxpayer-funded rescue of precisely this firm. Which is why, in the absence of others doing so, we have decided to ask this question directly of Goldman head of PR Lucas van Praag.
To wit:
Dear Lucas, in going through the Goldman Sachs code of business conduct and ethics, we have noted Section III "Waivers of this Code" where it states:
From time to time, the firm may waive certain provisions of this Code. Any employee or director who believes that a waiver may be called for should discuss the matter with an Appropriate Ethics Contact. Waivers for executive officers (including Senior Financial Officers) or directors of the firm may be made only by the Board of Directors or a committee of the Board.
Could you please advise when the most recent invocation of an ethics waiver occurred for GS executive officers (and whether this was in fact approved by the BOD), and also whether there have been any ethics waivers for any non-executive employees of Goldman over the past five years either in connection with currently ongoing civil and criminal litigation involving Goldman's Structured Products Division, or any other Goldman group, including, but not limited to: Fixed Income Currency and Commodities, Sales and Trading, Quantitative Strategies, Quantitative Resource Group, Goldman Sachs Asset Management, Goldman Global Alpha, Correlation Trading, Investment Banking, and Primary Dealers, and the specific details thereto.
Your prompt response is much appreciated.
The Zero Hedge team.
We are confident that since Goldman has nothing to hide in this or any other matter, a prompt response is indeed forthcoming. If it is not, we will kindly ask those members of Congress and Senate who have not yet been fully corrupted, to ask this very question of the Goldman CEO at the next immediate opportunity.
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The code of ethics is extremely important in maintaining high morale at the firm. It actually still works on a lot of Goldmanites, although it's tough to believe.
Sensible message.
What goldman sachs did had nothing to do with ethics because it was fraud.
There are about 6 people in Congress that would have the balls to ask that of Goldman. They are: Bernie Sanders, , Russ Feingold, Alan Grayson, Dennis Kucinich, Maxine Waters and Ron Paul.
The Code is short because it sets out principles. But it is prima facie unethical to waver on principles and issue waivers thereon. You'd think Goldman would have recognised and addressed this fundamental inconsistency before releasing their primary ethics manifesto to the public. It indicates incoherence within; a house divided against itself.
It costs very little to tell the truth. I expect a lot of highly paid lawyers drafted that document.
Catch-22 Incarnate.
Define from "time to time". One perusing aforesaid document one would intuitively assume (Thereby implementing Bozo's Law) that to mean for most of the time the Code would in fact be Implemented Dutifuly in Word and Deed.
However, it may also be read by the intuitively Unbiased, Unblemished, Uncarved Block as meaning in the vast Minority of Circumstances, for "from time to time" is a nebulous, jellified creature, that it may Not be so Implemented..
And just what constitutes "waiver"? There a multiple means by which approvals, waivers, pardons, and excuses may be attained. Again, the Well Meaning, Moral reader might well assume such to be a Specific Answer to a Specific Request. However, should such Specific Request not be made in order to Attain such Specific Waiver, then by all means, the action might thereby be deemed permissible. Ever heard of Plausible Deniability?
Having negotiated many transactions, some in fact sitting across the table from Goldilock's fine soldiers, never has anyone ever batted an eye at a most common "escape clause", the Mastery of Disingenuous Consideration; "Notwithstanding Anything to to the foregoing...."
Indeed, I assume Mr Van Pragg's response to be of a most entertaining nature.
As it is with all employees, Mr. Van Pragg is no doubt forbidden to read ZH or even acknowledge its very existence.
Hope Tyler sent his inquiry by certified snail with return receipt requested. Let us now hold our breath.
DOS attack on ZH by GS hacks in 4..3..2..1..
There are situational ethics, non-core ethics and good old plain ethics. Some laws are more important than others. We all must make decisions on a minute to minute basis. The temptation of the private sector is the power of money, power and influence. Pure, unbridled capitalism is a real danger. You can rob a dead person to pay for his funeral or you can organise a contract with him to pay for the burial. Some corporations do more ethical things than others. The perfect corporation does not exist but could. This is not the forum to explain such a momentous idea.The boundary delineation that needs to take place around the world for a healthy global economy is great. Some things are important. Some things are urgent. The various leaders are currently scrambling on the priorities and necessary management structure. Goldman Sachs is working out how it should orientate itself.
Poor Goldman, trying to navigate the perilous waters of capitalism with only a crew of paid for congressman, a rigged casino and an SEC threating to declare mutiny if they dont fork over about a days pay from their shareholders or face a stern slap on the wrist.
Just how does one "orient" oneself in such a trying time?
Gosh, I wouldnt know. I get my trades frontran and lose when they goose the market and junked if I win if the mm like goldman dont make any market in a crash, and if I steal a CD from a store I go to jail. I cant really relate to the ethical challenges of goldman. I pretty much am stuck with ethics, given the lack of connections to get me out of trouble.
From what I see, the ethics waiver (oxymoron?) is there to be applied at anytime the relentless blood funnel is about to poke into anything that smells like money, including working class pensions. The waiver thus absolves those pesky ethics of any violation, since they were waived.
Posistioning? Thats easy, Tentacles firmly anchored around the politicians shoulder and the taxpayers wallet in case a victim has no blood to give; blood funnel pointing directly at the next dupe who plays at the rigged casino.
Heres a good question for Goldman; Has any ethical consideration ever in the history of your firm, ever caused the firm to decline a deal where considerable profit was probable?
Bet they would have to really search the archives for that one!
Fazzie, "ethics waiver", is that exactly, oxymoron. More hot air and BS from the masters of it.
Just having the words "ethics" and "Goldman Sachs" in the same sentence seems pretty ridiculous.
Welcome to the internet, Adam. This ain't a professor talking. Sounds like a "run on sentence", Adam. You need to be specific, Adam. WTF are you talking about? Nothing but psychobabble without examples, Adam. Poor essay! I'd give you an "F", but your professors would give you a "B" because, at least, the sentences were gramatically correct.
Please forgive me, Adam, if you are trying to kick someone in the groin, please kick them in the groin. Don't leave them hanging with psychobabble.
I really hate it when people go out of their way to be a dick, Rickardo. A simple plea to change his writing style so that it is less choppy, to make it more readable, would have been much more beneficial.
The entire financial system has been one big ruse. We are pawns in a game that is stacked heavily against the common man. It is obvious that Goldman Sachs and every other financial institution have realized that the governments are so dependent for financing of their massive debts that they essentially have a 'get out of jail' free card. What moron actually believes that what they did was not outright criminal. They might not have used a gun in the physical sense, but they hold the system hostage none-the-less. As another post said previously, Debt is the currency of slaves. Seems to sum up who really controls this country...
The quality of life for many people all throughout the world is of a magnitude previously unheard of. No-one says things are perfect. There are great and terrible inequalities everywhere. However a certain base and platform is necessary for the full redemption of the world to take place. The number of people experiencing a decent level of the general welfare right now compared to one hundred years ago is great. The world is also far more peaceful than it was even forty years ago. It is all a matter of perspective. The fact that this resource even exists and people are able to read ZH is truly messianic and a blessing from G-d. The internet is a truly remarkable invention. All inventions emerge out of the matrix and superset that is Creation. The opportunities for great things are there if people are willing to seize them. The universe is stable, ordered, benevolent and expansive even the minds of many bear witness to the opposite fact.
Are you familiar with the 1942 Johnny Mercer tune ?
"You've got to accentuate the positive, eliminate the negative, hold onto the affirmative and don't mess with Mr.In-Between !"
Entrepreneurs, engineers and scientists have increased the quality of life for the world, not bankers or politicians. Don't be fooled by the financier's phony arguments that their distribution of capital is responsible for technological advancement leading to standard of living increase.
As for inventions emerging out of the matrix?
One authority on the subject, Thomas Edison, said that invention is 1% inspiration, and 99% perspiration. However another of repute, Nikola Tesla, said that Edison wouldn't sweat so much if spent a little more time thinking. Either way, they do not emerge from the matrix, inventions are a product of human capital.
@ adam
You lost me at "blessing from god."
Precisely.
Well, septicshock, sounds like you are comitting treason. Welcome to the club. Tyler Durden would be proud of you.
Now, septicshock, what the heck (nay, WTF) are you going to do about it?
Hey Ricardo, I feel I am being patriotic and not treasonous at all. It is not wrong to say a cheat is a cheat. It is not wrong to say a crook is crook. Our country was founded on ideals that I still believe to be good and decent. My freedom of speech allows me to speak out against the tyranny of evil men. Isn't this what Tyler does all day? Isn't this what you do by contributing to this site? All of us on this site obviously believe that "all it takes for evil to prevail is for good men to do nothing!"
What can I do about it? I can speak the truth. I can and have taken my money out of the stock market. I can support gold as currency with both my voice and my purse. I will continue to view my current and future worth as what my individual skills will be worth to society - there is no better hedge to inflation.
I am one voice, together we are two. :)
As far as stocks and gold go, while it's fine that you are covering your ass investmentwise, cloaking it as patriotism or doing something for the common good is as hypocritical as those you are supposedly "speak[ing] the truth" on. Who are you kidding (except yourself, of course)?
You flatter yourself in thinking your posting in an internet site's comments area is bringing worth to society although a lot of people posting at ZH have a similar opinion of their impotent rants.
Junk comment of the day. People have ideals, but you try to bring others down to your level of having none to delude yourself. Junk.
"Ideals"! I get it. Sort of like that serial Welfare participant, "Joe The Plumber" or all those old folk and assorted white trash at those Tea Party rallies who are collecting Social Security, Food Stamps and using Medicare or in many of their cases, Medicaid whining about Entitlement Programs and helping promote the "careers" of Sarah Palin and other newly minted multi-millionaires working that corner of the ghetto. Yeah, it's not hypocracy it's Idealism!
Good for you "Hansel," "Pussy RecardoM from Temecula CA" and of course, "septicshock." Goldman Sachs, Haliburton and the members of both parties whom they own won't get a minute's sleep as long as you Tools are posting your "patriotic" comments. Keep up your "activism."
Jeeesh! LOL!
Seems to have you attention milbank
The funny thing is that when enough people get very angry, and because of sites like this, know where to direct their anger, they can effect real change.
The revolution has started and the criminals are afraid of what may happen.
Internet comments impotent?There is power here...and TPTB knows it.
ZH is dangerous...and I love it.
My apologies septicshock. I am at wits end about what do to about all of it, that's all.
Take up arms? Nay. Better to go to work, pay my taxes and watch it all come down. Then, stay home from work when it does and figure out what to do next.
My tongue gets waggin' after I've had a few Mojitos. Sometimes I wish I had a breathalizer on my computer. It might prevent me from using my dangerous mouth on the internet.
Judge: Do you promise to tell the truth, the whole truth, and nothing but the truth?
Goldman: To a point.
Judge: What point is that?
Goldman: To the point that I am no longer telling the truth.
Nice one. Thankfully for them, they have infiltrated our government well enough to probably be able to say that.
God smiles down upon them. It makes complete sense if you realize they think the Fed is God.
They are doing God's work. Thy will be done.
A-fed.
"Hey, we never know what G-d will want us to do next. We have to be prepared."
Goldman's ethics = oxymoron
Hahaha! Ethics and Goldmans Sachs in the same sentence is a contradiction in terms. Besides, ethics are for the little people. We are doing Gods work and we pay our congressmen and regulators well.
Thanks for the Laff.
Ethics - Didn't anyone see the quote below in the "Goldman Trading-Code Investment Put at Risk by Theft" article by By David Glovin and Christine Harper on July 6, 2009?
“The bank has raised the possibility that there is a danger that somebody who knew how to use this [I.e. Goldman's software trading] program could use it to manipulate markets in unfair ways,” Facciponti said, according to a recording of the hearing made public today. “The copy in Germany is still out there, and we at this time do not know who else has access to it.”
More of the article:
... Sergey Aleynikov, an ex-Goldman Sachs computer programmer, was arrested July 3 after arriving at Liberty International Airport in Newark, New Jersey, U.S. officials said. Aleynikov, 39, who has dual American and Russian citizenship, is charged in a criminal complaint with stealing the trading software.
At a court appearance July 4 in Manhattan, Assistant U.S. Attorney Joseph Facciponti told a federal judge that Aleynikov’s alleged theft poses a risk to U.S. markets. Aleynikov transferred the code, which is worth millions of dollars, to a computer server in Germany, and others may have had access to it, Facciponti said, adding that New York-based Goldman Sachs may be harmed if the software is disseminated.
“The bank has raised the possibility that there is a danger that somebody who knew how to use this program could use it to manipulate markets in unfair ways,” Facciponti said, according to a recording of the hearing made public today. “The copy in Germany is still out there, and we at this time do not know who else has access to it.” ...
Of course, ne're a thought that the saints and angels at Goldman would "use it [the Code] to manipulate markets in unfair ways". They are soooooooo ethical. They even have the code -- that "From time to time, the firm may waive certain provisions of this Code."
Is there anyone out there anymore to even question this stuff or even give a flying crap about this? I thought that there has to be one real investigative journalist, clean politician, or honest & intelligent regulator, or greedy securities attorney somewhere that would do something with this. Hell, they're admitting it to the FBI!!
I quess I just have to figure out what level of the matrix I am living in anymore.
Here is a link to the article:
http://www.bloomberg.com/apps/news?pid=20601087&sid=a_6d.tyNe1KQ
Some ethical code?
http://www.zerohedge.com/forum/oversight-goldmans-and-others-trading-programs-can-manipulate-markets
WAY OF THE SQUID:
http://williambanzai7.blogspot.com/2010/04/way-of-squid.html
YOU SPEAK TO ME OF CODE? WHAT DO YOU KNOW OF CODE!:
http://www.youtube.com/watch?v=x3pQubiUXD0
Buying support continues ...
DOW updated charts:
http://stockmarket618.wordpress.com
http://www.zerohedge.com/forum/latest-market-outlook-1
Shucks..
I am taken aback when I see phrases like: patriotic to MY country.
It's not YOURS. It belongs to a group of OWNERS. They OWN you.
"Right to Free Speech" "Right to Assemble" etc. A facade.
Reference material appearing under (Jordan Maxwell)(Receivership)(Register)(Birth Certificate).
As far as the specific conditions that invoke the waiver of ethical behavior. How about reading and signing the acceptance of the Code of Ethics? Since that waiver is part and parcel of the SOP of Goldman, how could it be otherwise. Very much reminiscent of other completely corrupt ethical schools.
I.E.: Keysianism > "This school's real purpose is to give cover for pillage and rape."
It's good to know how such a corporation functions by its own admission.
Yeah, anymore patriotism is for saps. Much like religion, it is used to keep the serfs feeling as though they are part of something much greater than themselves. Then they use the emotions that feeling evokes to manipulate the herd to their means.
Unfortunately, the sheep line up to buy both of these opiates and ostracize any who refuse to partake with them.
The vampire squid uses black ink to hide itself. Seems appropriate.
quite appropriate...good catch
That says it all.
Actually no, the vampire squid doesn't have ink sacks ( http://marinebio.org/species.asp?id=179 third paragraph), but it does have black chromataphores, even if it doesn't have the muscles to use them. It tries to cover itself in black, and then suddenly finds out that it is impossible.
Far out. I did not know that "Vampire Squid" was a real animal. Fascinating, particularly the video.
ETHICS LAB 101:
http://williambanzai7.blogspot.com/2010/06/business-ethics-basics.html
A marketing question...
Do you get many link follow-throughs to your blog from here? Since you seem to be the only one systematically doing this style of marketing of your blog, I was wondering if the approach works.
I thought if it worked, others would follow your lead.
FCIC says GS is playing the American people
for ´chumps´
http://voices.washingtonpost.com/ezra-klein/2010/06/fcic_says_goldman_sa...
Truth and ethics are situational in the world of the big lie.
Feudalism does have it's up and downs...aka the indentured guillotine.
Loud and Clear from Goldman. It's an 'ethical mission statement' and nothing more i.e. not an addition to regulation or law. Actually I'm feeling quite moved that any such document has been written at all.
They should have made the "ethics manual" more like a 1000 pages long, so next time they are being grilled in court, they can waste time, and shake off the Judges and Congress members by, flummbling through and referencing a 1000 page manual, even if it is bullshit.
But with only 4 pages, it dosn't give them alot of hiding room, or maneuvring of the defense team. Not really thought out by the high priced lawyers. Remember the Tiberwolf deal, court hearing, inwhich each Goldman had a 1000 page binder in front of them, that took about a minute to find the referenced page if at all? Now that was good strategy.
This 4 page ethics pamplet, NOT so much.
Unless of course they feel they are doing Gods work, already, and no need for a thick ethics manual? Lyold could always reference the Bible, if he is in question. I wonder if Lloyd has a Bible on his desk, in case he has a question in regards to God's work and is unsure on how to move forward.
This reminds on the recent Onion story "Entire staff at Facebook laughs, as man tries to tigthen security settings."
I can see the story now. "Lucas Van Praag laughs himself into a comma, when a new employee asked for a copy of the "ethics manual."
It's not a comma...it's a coma.
Sorry, I missed that ... must have gone comma-tose for a moment. Or at least into a semicolon state.
One either HAS ethics or one DOES NOT have ethics. To waiver ethics is to admit that one never possessed ethics in the first place.
It is much like having CHARACTER. It is WHAT one does when NO ONE is looking. Driving one way when no law enforcement is visible and driving another way when law enforcement is visible truly defines the paradigm example of character.
Ethics, character, et.al. are all related and in many ways synonymous.
I have seen this kind of thing from the inside and it is done the same way in corporations large and small. Top management says "every company has a Code of Ethics, it would look bad if we didn't." So some functionary with a gift for high-minded blarney is given the assignment. It is understood that this document must seem to cover any kind of accidental or deliberate malfeasance, while placing no restrictions on actions that may be necessary in the company's interests.
lexpie is spot on comparing these to mission statements. I have never seen one that was not meaningless fluff. If they were honest then every mission statement would be the same because the goal of any for-profit enterprise is the same. Not criticizing the goal, just the hypocrisy.
Excellent thought. And, more importantly, as we will see in the case of the Fabulous Fab, it gives the corporate entity credible deniability when an individual is caught executing the mandate of his superiors.
Good post exposing GS for what they really are.
"It is much like having CHARACTER. It is WHAT one does when NO ONE is looking. Driving one way when no law enforcement is visible and driving another way when law enforcement is visible truly defines the paradigm example of character.
Reminds me of a "Dilbert" cartoon -
Dilbert is sitting in a reclined position, feet on the desk, staring at the ceiling...
Dilbert's boss walks by: "Dilbert, why aren't you working?"
Dilbert: "I didn't know you were looking."
Lloyd - "I need a waiver and it would be best if it was in perpetuity and that I can grant it to anyone in the company"
BOD - "OK, what for?"
Lloyd - "God's work"
BOD - "Granted"
Goldman will laugh at your letter just like they laugh at ethics after totaling up their profits. Then they will write a preposterous response to you if they can stop laughing long enough.
The most effective way to deceive is always in plain sight. The dis-claimer at the end of their policy is omni-present throughout fascist society. It is imperative that the corporate-state change the rules on-the-fly, as they understand the constantly changing nature of all things, particularly as it applies to controlling the population.
DOW chart warns of a rally :
http://stockmarket618.wordpress.com
http://www.zerohedge.com/forum/latest-market-outlook-1