On Wednesday afternoon last week, there was a major fire next to Goldman Sachs’ offices in London. Six fire crews came to tackle the blaze in a flat above a Pret A Manger sandwich shop in Fleet Street. The blaze was extinguished within an hour and the bank decided against evacuating its staff. Even so, the firm’s ‘Office of Global Security’ was almost certainly in a state of heightened operational preparedness.
Investment banks take security extremely seriously, and after Friday evening in Paris they are likely to take it more seriously still. Goldman Sachs’ Office of Global Security employs at least 50 people globally – probably more, many of them with a background in the world’s intelligence services.
“The intelligence services are hemorrhaging talent,” says the head of a covert UK recruitment firm which specializes in assisting people from MI5, MI6 and UK Government Communication Headquarters (GCHQ) into jobs in the private sector. “They are incredibly high quality and there is a growing appetite in banking for their services.” In line with his candidate base, the recruiter asked not to be mentioned by name. “I never directly approach people in the services and I don’t advertise. People seek me out.”
In the past, banks hired ex-police for security roles. Now they are trusting the security of their operations to individuals with backgrounds in military operations and state intelligence. The MD of security at Goldman Sachs in EMEA is Ben Dyer, a former infantryman who spent 16 years in the British army and who has taken the UK’s elite ‘Advanced Command and Staff Course.’ Credit Suisse’s global head of security services outside Switzerland is Tim Rawlins, a specialist in crisis management, executive protection and operational management who spent 14 years in various unspecified ‘security and intelligence positions’ with the British government. Matthew Penny, global head of crisis management and protective intelligence at Deutsche Bank, attended Sandhurst Military Academy and spent four years in the British Army.
Banks pay their securities professionals well. “A global head of security in a bank could be on anything from £150k ($228k) to £200k in basic salary,” says the recruiter. “A regional security manager might get £120k and a head of threat and intelligence might get £90k to £100k.”
While this may not be generous compared to pay for bankers in the front office, it’s very generous compared to the pay on offer in government securities roles. When the UK’s GCHQ set a ‘fiendishly difficult puzzle’ in an effort to recruit staff four years ago, the five people who solved it were eligible for a job paying £25k ($38k). The recruiter says pay in the intelligence hasn’t risen much since – while the cost of living in London has gone through the roof: “I’ve placed people with five years’ experience in intelligence who were earning £35k. They love their work, but they’re working long hours and have families and can’t afford to support them.”
For this reason, he says it’s common for the UK security and intelligence services to recruit staff straight from university and to lose them a few years later. “Our graduate recruitment salaries are reasonably competitive but we lose traction in mid-career,” complained Sir David Pepper, the former GCHQ director six years ago. The CVs of the ex-GCHQ staff who now work in finance are testimony to this – many join for a few years out of university and then move into technology or even trading roles in banks a few years’ later. Take Fiona Ellis, who was sponsored through her degree by GCHQ and who spent nearly three years working for the Metropolitan Police, but is now an executive director in technology at J.P. Morgan, or David Saunders, who spent a year at GCHQ after graduating before moving to Deloitte and then to Barclays, where he now works in traded asset disposals.
“These are highly sophisticated intelligence people who are on civil service pay,” says the recruiter. “They’re earning £35k and are briefing government ministers on extremely sensitive work. They look across to banks and see someone paid twice as month for doing something that’s far less important. They have a huge sense of duty and service, but as their needs change through their life the private sector becomes more appealing.”
Following the Paris attacks, the UK government has announced plans to recruit an additional 1,900 officers for MI5, MI6 and GCHQ. With the finance industry also interested in intelligence talent – and not just for security roles, keeping them may be harder than getting them through the door. Even Sir David Omand, a former director of GCHQ and head of counterintelligence strategy for the British government, has just launched the UK arm of Paladin Capital Group, a US security-focused venture capital firm in London.