Goldman Sachs, which paid a $550 million penalty for designing an uber-complicated synthetic collateralized debt obligation and then misleading institutional investors about how the contraption worked, has bought a personal finance app called
Clarity Money.
The acquisition, for a reported eight-figure sum, helps advance Goldman's effort to provide loans and other financial services to average customers.
[More: Finra bars ex-Goldman Sachs banker after expense report issues]
Goldman's acquisition underscores how Wall Street's most respected and reviled firm is trying to change its business mix and remake a public image shaped in part by a 2010 Rolling Stone article that described the firm as "a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money."
In a
statement Sunday, Goldman said Clarity Money would help it provide individual loans and other services that are "simple, transparent and always on the side of the customer."
Goldman seems to like retail banking businesses with wholesome-sounding names. In 2016 it bought a digital retirement-savings platform called
Honest Dollar.
Goldman's consumer bank is called Marcus after founder Marcus Goldman, the immigrant son of a Bavarian cattle drover who in 1869 began buying short-term commercial loans from jewelers and leather merchants in Lower Manhattan. He would then take a horse-drawn cab to the commercial banks on Broadway to sell the paper for a profit.
"Dressed in a Prince Albert frock coat and tall silk hat, he presented himself rather grandly as 'Marcus Goldman, banker and broker,' " according to Charles Ellis's book "The Partnership."
Aaron Elstein is a senior reporter at sister publication Crain's New York Business.
