What can we learn from ex-Goldman exec's resignation letter?

— -- Q: What can investors learn from the scathing resignation letter by the former Goldman Sachs employee?

A: Most resignation letters are quietly exchanged between employees and their bosses two weeks before the last day. But not so with Greg Smith, a London-based employee of Goldman Sachs.

Smith's letter, first published in The New York Times, outlined the 12-year veteran of the firm's gripes against the bank. He stated, without giving many details, on how the company has allowed its pursuit of profit to supersede its role to serve the customer.

In the letter, Smith said Goldman employees scoffed at the mental capacity of clients who willingly bought financial instruments the investment bank was eager to unload. Goldman's management disputed the allegations through a letter distributed internally, according to Reuters.

Investors, though, can't deny the employee's statements offer a rare glimpse, albeit from one person's perspective, into the closed-door, off-limits world of Wall Street. If anything, investors should view the Smith resignation letter as a reminder to evaluate any investment firms or people they're working with to determine their true motives.

This kind of tell-all isn't new, says Mark Hebner of Index Funds Advisors. The books Where Are the Customers' Yachts by Fred Schwed and Robbing You Blind by Mark Dempsey are other examples of financial professionals telling how many large firms' pursuits for profit trumps the goal of serving the customers, Hebner says.

Such commentaries, including Smith's letter, should not be lost on investors. When evaluating people who are managing their money, investors need to be mindful of whether the managers are true fiduciaries, or commissioned to serve in the best interest of their clients, Hebner says. You need to understand the relationship you have with your money manager and insure your well-being is their responsibility. If not, you might want to look elsewhere, he says. "Brokerage firms have clauses that exempt them from being a fiduciary. It's just incredible," he says.

To be sure, in a number-driven world it's tempting for professionals and firms to put profit above everything else, says Michael Josephson of the Josephson Institute of Ethics. And moral breaches can be tempting in the financial industry and on Wall Street, he says.

And that's why Josephson hopes regulators, investors, the media and Goldman Sachs don't miss the lessons that the letter raises. Given the near failure of the financial system in 2008, due in some part to ethical failings on Wall Street, it's critical for ethical failings by firms to be isolated, punished and ended, he says. "The power of some individuals to create genuine havoc is so great, that's why we need to be more vigilant," he says.

Josephson thinks Smith and Goldman Sachs should provide much more detail on their side of the story so investors can better access the accuracy of the claims.

In the meantime, investors should know who is giving them advice and what their true motives are. And if the person managing your money's objective isn't to insure your financial success, then you might want to keep looking, Hebner says.

Matt Krantz is a financial markets reporter at USA TODAY and author of Investing Online for Dummies and Fundamental Analysis for Dummies. He answers a different reader question every weekday in his Ask Matt column at money.usatoday.com. To submit a question, e-mail Matt at mkrantz@usatoday.com. Follow Matt on Twitter at: twitter.com/mattkrantz