Goldman CTO Is Now Leaving For Hedge Fund Citadel

August 27, 2024

Goldman CTO is now leaving for hedge fund Citadel after five years with the bank, taking on a leadership role in its engineering dept.

Atte Lahtiranta, who was hired by Goldman Sachs in 2019, will be taking on a new role as the head of the core engineering group at Citadel, per Bloomberg.

In this position, Lahtiranta will be responsible for overseeing the technology that supports Citadel’s trading and risk functions.

Neither Goldman nor Citadel have officially announced Lahtiranta’s move yet, and Bloomberg did not provide a start date for his new role.

However, Citadel’s Chief Technology Officer, Umesh Subramanian, who previously held Lahtiranta’s position at Goldman, stated that the firm is looking forward to welcoming Lahtiranta, per Banking Dive.

Lahtiranta’s departure from Goldman is part of a broader trend of high-level executives leaving the bank in recent years, including Jim Esposito, the former co-head of global banking and markets, who is set to join Citadel Securities as president next month.

Unlike some of Goldman’s other recent departures, which involved executives who joined the bank before David Solomon became CEO in 2018, Lahtiranta is a hire from the Solomon era.

His time as Goldman’s Chief Technology Officer included navigating the bank’s transition to remote work during the early days of the COVID-19 pandemic.

The increased focus on emerging technologies, such as artificial intelligence, at large financial institutions like Goldman has also likely contributed to the demand for talent in these areas, as evidenced by Citadel founder Ken Griffin’s comments on the importance of AI.

While some of Goldman’s recent alumni have taken on leadership roles at other banks, several have moved to non-bank positions in the broader finance industry, including roles at firms like Cloudflare and Grayscale.

Retail investors have warned regulators of the conflicts of interest that surface when employees cross industries working for hedge funds.

Often times, we see hedge fund affiliates or board members also take a seat at financial and regulatory committees.

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Also Read: Exposures At Hedge Funds Now Surge To Over $28 Trillion

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An investment banking company is now under investigation for illegal trading according to an SEC and Bloomberg report.

B. Riley Financial Inc. is facing an investigation, meanwhile shares have lost more than half their value amidst the probe.

The agency is assessing whether the investment bank adequately disclosed the risks associated with some of its assets to investors.

The SEC inquiry also extends to examining the interactions between B. Riley’s founder, Bryant Riley, and the former CEO of Franchise Group Inc. (FRG), Brian Kahn.

FRG is one of B. Riley’s larger investment holdings.

In addition, the SEC probe is looking into possible improper trading by other insiders at B. Riley.

Regulators have also asked about the movement of receivables due from cash-strapped retail customers, whose repayment might be doubtful.

The SEC’s civil probes, involving lawyers in Los Angeles, Washington and Philadelphia, are running concurrently with a federal criminal inquiry in New Jersey.

This criminal investigation is focused on the 2020 collapse of an investment fund, Prophecy Asset Management, where Brian Kahn handled most of the fund’s assets.

The news of the SEC investigation has had a significant impact on B. Riley’s stock price, with shares dropping over 54% to $7.73 per share during the trading session.

This multi-faceted regulatory scrutiny of B. Riley underscores concerns about the firm’s risk management practices, disclosures, and potential misconduct involving its leadership and investments.

Prophecy investors who lost money have questioned in a lawsuit whether Kahn improperly used Prophecy proceeds to acquire control of FRG for himself. A co-founder of that fund pleaded guilty in November in a $294 million fraud case and is cooperating with prosecutors, who tagged Kahn as an unindicted co-conspirator, Bloomberg previously reported.

Bryant Riley told investors in a Monday conference call that he and the company received subpoenas in July from the SEC focused mainly on B. Riley’s dealings with Kahn.

“We are responding to the subpoenas and are fully cooperating with the SEC,” Bryant Riley said.

“We are confident that the SEC will reach the same conclusion that our own internal investigation, with the assistance of two separate law firms, did – that we had no involvement with or knowledge of any alleged misconduct concerning Brian Kahn or his affiliates.”

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Also Read: The US Treasury Direct is Now Freezing Customer Accounts

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