A former executive director from Goldman Sachs’ private wealth management division believes wealthy families are poorly served by private banks and has set up what he calls a lower cost multi-family office model, according to Citywire.

Yogi Dewan, who worked atGoldman Sachs for nine years and built up its private wealth management division across Europe, was quoted as saying that he was so incensed by alleged over-charging and product pushing that he resigned and set up his own multi-family office,Hassium Asset Management, in 2006.

Today, the firm has around $500 million and recently opened two new offices in London and Zurich to accompany its office in Beaconsfield, southern England.

"I felt that Goldman Sachs, like a lot of private banks in the space, had lost its way. Over the years I worked with a lot of wealthy families and felt that a lot of banks were focused on generating revenue streams and selling products, often putting clients in products that are not in their best interests," Dewan was quoted as saying.

The issue of whether banks push products to their wealth management clients is a staple complaint in the industry. One on hand, some recent survey evidence, such as from Scorpio Partnership, the research and consultancy, suggests clients have grown more sympathetic to in-house products. However, other private banks insist clients value the ability to obtain best-of-breed products from outside.

In the interview, Dewan was quoted saying that he believes the central problem lies in the conflict of interest between how the performance of banks is measured, how their work is compensated and what clients actually need. Pointing to ‘excessive management charges’ and commission fees, Dewan said the charging structure was misleading.

"Everyone has to make a profit and make a living, but we are talking about families. I think they should be treated as institutions in their own right," he said.

As reported earlier this month, Hassium Asset Management appointed Marco Naumann as managing director of European operations based in Zurich, in a hire which coincides with the launch of the new offices in the Swiss city and in London.