By Rabbi Mendel Prescott

In the previous articles, much was brought up on ribbis in the corporate world. To give a real sense of how ribbis issues permeate so much of everyday financial life in America, we present here a few real-life cases that serve as prototypes for a much broader range of situations. We’ll examine what goes into determining the “kashrus” of a financial institution.

Let’s focus on Goldman Sachs, one of America’s largest investment firms, which operates like a typical bank alongside its other investment services. The founders of Goldman Sachs in the mid-1800s were Jewish, as the names plainly suggest — but over a century, companies change hands, and founding identity usually carries no weight. What matters is who is running the firm today. But let’s examine the current leadership.

The firm’s present leadership is notably Jewish — David Solomon as CEO, John Waldron as President, and Kathryn Ruemmler as General Counsel — all sitting at the very top of the decision-making structure. But leadership is not ownership. A malveh is the owner of the funds, not the one who administers the loan. One may bank at a non-Jewish bank even if the managers happen to be Jewish. Let’s take a look at the holdings.

Of the Jewish board members, Solomon holds the largest number of shares, at over 150,000, quite a sizable holding. While this may sound substantial, realize that Goldman has approximately 307 million shares outstanding. His stake amounts to roughly 0.05% of the company — negligible by any measure.

We previously cited Rav Moshe Feinstein and the Minchas Yitzchok who rule that Jewish stockholders pose no ribbis problem, since a minority shareholder exercises no real control over company decisions. A 0.05% stake carries no extra voting weight, no board access, and no operational influence whatsoever. (It is the institutional investors like Vanguard and BlackRock who hold 6–7% who sometimes manage move outcomes at annual meetings.) But Solomon isn’t a passive shareholder — he’s the CEO. Does his executive authority elevate his shareholdings to the level of halachic baalus?

Authority vs. Ownership

In a public company like Goldman Sachs, executive authority derives from one’s board appointment, not from share ownership. Solomon’s power to set lending policy, direct strategy, and oversee the firm’s interest-bearing operations is entirely due to the board’s hiring him as CEO. Even if he were to sell every share he owns, his would theoretically remain with identical authority. It would seem, then, that the two factors can be separated: his shareholdings are negligible, and his executive authority is independent of ownership and therefore poses no ribbis concern.

However, in practice, these two elements — share ownership and executive power — are difficult to be entirely isolated from one another. Large public companies typically maintain stock ownership guidelines, requiring executives to hold a significant number of shares (e.g. five to six times their salary) so that his decisions are aligned with the company’s interests. Goldman Sachs has such a policy. Hence, the shares are not incidental; they are a component of the executive’s role. So, David Solomon’s equity stake and his authority are not as easily separated as one might have thought.

Rav Avraham Moshe Levanoni in his Mishnas Ribbis (p. 61) addresses this question. His position is that the two aspects need not be viewed as connected — a CEO’s power stems from his election to that position, not from his ownership stake. He writes that he presented this reasoning to Rav Yisrael Belsky, who agreed, and added that he had heard the same sevara from Rav Moshe Feinstein. In addition, Rav Levanoni cites a teshuva from Rav Elyashiv (in the appendix to the sefer) who rules leniently on this point.

However, he writes that Rav Belsky added an important distinction: board members are to be treated differently from ordinary shareholders. Even a percentage of ownership that would pose no problem for a regular shareholder may be problematic when held by a board member, given the relationship between ownership and authority. The precise threshold, however, is not spelled out there; possibly 0.05% would pose a problem.

Subsidiary Companies

A related question arises with subsidiary companies. A subsidiary company is an independent company that is bought out completely by a larger company, but retains its own identity. Take GreenSky Lending as a real example — a construction loan firm that was acquired by Goldman Sachs in 2022 and structured as a wholly owned subsidiary of Goldman Sachs Bank. As such, borrowing from GreenSky would be halachically identical as to bowworoing form Goldman Sachs.

Subsidiary companies are not as straightforward as they may seem. Sometimes the parent company literally purchases the smaller company outright. But sometimes a parent company functions essentially as a syndicator or aggregator — it doesn’t truly “own” the subsidiary in the conventional sense. Rather, it raises money from outside investors, manages the operation, and collects a fee or carried interest, while the actual capital belongs to those outside investors.

For ribbis purposes, this distinction is significant. If Goldman Sachs is acting as a syndicator, then the real malveh isn’t Goldman Sachs at all — it’s the institutional funds behind the curtain who are the true lenders, and those are almost invariably non-Jewish entities. Determining which model applies requires researching the specific structure of the arrangement. (As of this writing, Goldman Sachs has sold GreenSky entirely to another institution, eliminating the issue for future transactions.)

Rov and Breirah

Even where Jewish ownership exists, two additional heteirim were raised by earlier poskim when the bank question first surfaced in the mid-1800s.

The first is the principle of rov. Rav Yitzchok Aharon Ettinger, in his teshuva regarding the beer production company in Nadvornah in which Jews held stock (discussed in an earlier article), added – beyond his primary hetter – that the Jewish shares could be disregarded since they constituted a minority.

Rav Yisrael Salanter (cited by Rav Moshe Sternbuch in Teshuvos Vehanhagos 4:194 and 2:421) similarly ruled that where Jewish shareholdings are a minority, we may apply bittul b’rov. However, he notes that this only works where the Jewish portion is not publicly known or identifiable. Otherwise, bittul b’rov cannot be applied. So, this hetter will not straightforwardly apply in the Goldman Sachs case, where Jewish identity in its leadership is very much publicly known.

The second principle raised is breirah. The concept of breirah allows us to clarify the designation of something that is otherwise unspecified. The classic example brought in the Gemara (Bava Kamma 51b) is the case of two partners in a property, where one forbids the other through a neder from deriving benefit from him. The question is whether the forbidden partner may still use the jointly owned property. If we apply breirah, we say that whatever portion he uses is viewed as his own for the time being — even though partnership ownership is by definition unspecified.

The same logic is applied here: any loan taken by a Jew from such a bank can be considered as coming specifically from the non-Jewish portion of the ownership. The Sho’eil U’Meishiv (Kamma 3:31), among others, raised this as a viable hetter. However, it sparked considerable debate among the poskim as to whether breirah can legitimately be applied in this context.

The Rebbe, in a letter addressing ribbis, cites this sevara but limits it to cases where the ribbis in question is d’rabbanan as the halacha follows the shittah of ein breirah for issurei d’oraysa. (See earlier article more on the Rebbe’s letter.)

Fintech: A Jewish Face on a Non-Jewish Bank

In the last decade, a new model of financial services has reshaped how people borrow and bank: the fintech company. Unlike a traditional bank, a fintech doesn’t hold a banking charter or lend its own money. Instead, it builds a digital platform, acquires customers, and partners with a licensed bank in the background to hold the deposits and issue the loans.

BlueVine is a classic example. Founded in 2013 by Eyal Lifshitz and Nir Klar, both of whom are Jewish, the company provides business banking to thousands of small businesses across the US and is currently privately owned. Can one bank with BlueVine without a hetter iska? The answer would seem to be yes — because BlueVine is not a bank itself. It is the face, the app, the brand, and the customer relationship, while the actual banking services are provided by Coastal Community Bank, and lines of credit are issued by Celtic Bank, a Utah-chartered industrial bank. The money being lent is theirs, not BlueVine’s. BlueVine is but one example of many such companies in the fintech world.

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