The MTA is by far one of the most unpopular agencies in our area. However another agency by far trumps it in the unpopular category & on a much bigger scale. The agency in question is Goldman Sachs who the MTA announced it will no longer employ as its financial advisor. Tom Namako of the New York Post has more in this brief exclusive report from Tuesday:
Beleaguered investment banking giant Goldman Sachs will be removed as financial advisor to the MTA, board sources said.
The transit agency’s finance committee will vote on Monday on whether or not they will hire a different analyst.
The MTA’s contract with Goldman, which was recently charged with fraud by the federal government over a subprime mortgage product, had recently run out.
The firm is currently working on a month-to-month basis with the agency, sources said.
It’s unclear if the investigation played any role in the MTA’s decision.
Board commissioners have criticized Goldman’s handling of MTA finances at public meetings.
Yet board sources also said that MTA management was happy with the company’s overall performance, and that transit brass simply found a better offer with a different company.
Goldman officials declined to comment.
The MTA is facing a $400 million financial shortfall for 2010.
I can’t say that I am surprised at this decision. I don’t believe this has anything to do with the negative spotlight being shined on Goldman Sachs but more of how they did not exactly do the best job with the MTA’s financial assets. This is the same agency that made almost $300,000 when advising the MTA on a questionable bond deal at a time when the market was extremely stressed. The other agency involved in the deal, was Citigroup Global Markets. The deal was so questionable, the Securities and Exchange Commission (SEC) filed a complaint.
I would love to know more details about the deal struck between the MTA & whomever their new financial advisor is. Hopefully details about that will be available soon & they perform better as Goldman Sachs was not getting the job done.