The Federal Reserve is investigating Goldman Sachs over the handling of its consumer business, known as Marcus, FOX Business confirmed Friday.
|GS||THE GOLDMAN SACHS GROUP INC.||341.84||-8.85||-2.52%|
Citing people familiar, The Wall Street Journal reported earlier in the day that the central bank has concerns that Goldman did not have proper safeguards in place at Marcus as the consumer lender’s business grew.
CONCERNS OVER A ‘WHITE COLLAR RECESSION’ GROW AS GOLDMAN SACHS, MORGAN STANLEY, AMAZON AND OTHERS CUT JOBS
Sources familiar told FOX Business that they are unsure of the seriousness of the Fed’s probe but noted that the central bank regularly examines consumer bank compliance issues and that Fed officials are stationed inside every major bank for the purpose of monitoring such issues.
When reached for comment, a Goldman spokesperson told FOX Business, “The Federal Reserve is our primary federal bank regulator and we do not comment on the accuracy or inaccuracy of matters relating to discussions with them.”
US BANKS GET READY FOR SHRINKING PROFITS AND RECESSION
The sources familiar also said the investigation is not seen as an existential threat to Goldman, but it poses another problem for beleaguered CEO David Solomon.
GET FOX BUSINESS ON THE GO BY CLICKING HERE
They added that Solomon faces pressure from partners at the megabank over his handling of the consumer business, on top of Goldman’s recent earnings miss and bonus cuts.