Is Goldman exec resignation drama all about a lost promotion?

When a London-based executive of Goldman Sachs wrote a searing denunciation of the bank in a public resignation letter, he was at first hailed for his moral courage and honesty.

Greg Smith, a vice-president who earned an estimated pounds £3 million a year, claimed that the culture of the bank had become "toxic and destructive" and said he was sickened by the way senior employees referred to clients as "muppets".

By Wednesday afternoon he was being mocked for the sincerity of his missive and described as the Jerry Maguire of the banking world after the film in which Tom Cruise plays a successful sports agent who denounces the industry he once loved.

Sources at Goldman Sachs suggested that Smith, who is in his mid-thirties, was disgruntled after not getting a promotion, while in the US it was reported that he had been passed over for a bonus.

Smith worked in the trading side of the bank, selling complex financial products based on the future behaviour of share prices. His clients were said to have included two of the world's largest hedge funds and three major sovereign wealth funds in the Middle East and Asia with combined assets of more than $1 trillion. But after 12 years he had enough.

Under the headline 'Why I'm Leaving Goldman Sachs', he wrote in The New York Times that, under the president Lloyd Blankfein, the bank had forgotten its culture of "integrity, a spirit of humility, and always doing right by our clients".

"It makes me ill how callously people talk about ripping their clients off," he wrote. "Over the past 12 months I have seen five different managing directors refer to their own clients as 'muppets', sometimes over internal email.

"Integrity? It is eroding. I don't know of any illegal behaviour, but will people push the envelope and pitch lucrative and complicated products to clients even if they are not the ones most directly aligned with the client's goals? Absolutely. Every day, in fact.

"If you make enough money for the firm, and are not currently an axe murderer, you will be promoted into a position of influence.

"I attend derivatives sales meetings where not one single minute is spent asking questions about how we can help clients. It's purely about how we can make the most possible money off of them."

He reminisced that he had mentored college applicants through the company's "gruelling" interview process. But he added said: "These days, the most common question I get from junior analysts about derivatives is, 'How much money did we make off the client?'

"You don't have to be a rocket scientist to figure out that the junior analyst sitting quietly in the corner of the room hearing about 'muppets', 'ripping eyeballs out' and 'getting paid' doesn't exactly turn into a model citizen."

Smith joined the bank following an internship he took while studying at Stanford University. He writes that his proudest achievements were being put on the shortlist for a Rhodes Scholarship to Oxford University and winning a bronze medal in the table tennis at the 2001 Meccabiah Games, the Jewish Olympics.

The professed table tennis achievements were widely mocked. "Bragging about winning a bronze? In Ping-Pong? Really?", said one Twitter comment.

Another said: "Seems the whole Jerry Maguire thing has finally caught on. Employees' public resignations from Google and now Goldman Sachs. Who's next?"

A source at Goldman Sachs suggested that Smith was disgruntled after not getting a promotion. The bank has five tiers of staff, from analyst to partner, with Smith's grade being the second rung.

The source said the best staff could expect to reach the third rung, managing director, by 30 and become a partner between the ages of 36 and 42. Those who had not been promoted by that age never would be.

Smith claimed to be the "head of the firm's United States equity derivatives business in Europe, the Middle East and Africa". Sources at the bank said he was head of a team of one. US reports suggested that he argued with supervisors over the size of his bonus.

The affair was also likened to an episode of the US drama Mad Men in which Don Draper, the advertising executive, takes out an advertisement to express his relief at losing a contract with Lucky Strike cigarettes.

In a statement, the bank said: "We disagree with the views expressed, which we don't think reflect the way we run our business. In our view, we will only be successful if our clients are successful. This fundamental truth lies at the heart of how we conduct ourselves."