Shares of Goldman Sachs Group Inc. slid 3.4% to $339 following a report from The Wall Street Journal that the Federal Reserve is investigating the company’s consumer bank business.
The regulator reportedly has concerns that Goldman didn’t have proper safeguards in place at its consumer-facing business, known as Marcus, particularly as the bank grew larger.
The investigation encompasses Goldman’s compliance functions, according to the report, which cites people familiar with the matter. Investigators are examining whether Goldman has exercised appropriate oversight over Marcus and looking for potential management or governance problems, while also looking into what happened in instances of customer harm, the report said.
The probe is another setback for Goldman’s troubled mass-market banking operation, which rolled out in 2016 to much fanfare but is now being scaled back amid a broader reshuffling of Goldman businesses.