U.S. Sens. Elizabeth Warren (D-MA) and Tina Smith (D-MN) are urging the Department of Labor not to give financial firm Goldman Sachs an exemption from Employee Benefits Security Administration (EBSA) that would allow the company to manage clients’ retirement plans.
The senators reasoned that the company should be held accountable for its “impending admission of criminal wrongdoing for its subsidiary’s role in the Malaysian 1MDB global bribery scandal.”
The lawmakers explained that EBSA has proposed an exemption for Goldman that would allow it to retain its status as a “qualified professional asset manager.” However, under EBSA regulations, a financial entity cannot maintain that status if convicted of criminal activity involving trust management. Goldman Sachs settled the case with the Department of Justice last October, agreeing to pay a $2.9 billion penalty.
“Companies that are convicted of or plead guilty to fraudulent schemes do not deserve special government favors. We have long been concerned about the federal government’s unwillingness to impose on white-collar and corporate criminals the penalties necessary to deter future wrongdoing and protect consumers, taxpayers, and families,” the senators wrote in a letter to Timothy Hauser, deputy assistant secretary of the EBSA, which is part of the Department of Labor.
The senators said that exempting corporations from consequences for misconduct is a breach of EBSA’s obligation to the public.
“You have the opportunity to send a clear message that the federal government holds corporate criminals accountable for their misdeeds and does not give them special regulatory favors. We ask that you review and rescind this proposal,” they added.
The post Sens. Warren, Smith urge Labor Department not to provide Goldman Sachs with EBSA exemption appeared first on Financial Regulation News.