Goldman Sachs has been accused of costing American consumers somewhere around $5 billion dollars in what analysts have called a “merry-go-round of metal” as the investment bank moved aluminum around its 23 warehouses in the Detroit area.

Goldman Sachs Sells Its Controversial Aluminum Warehouse Subsidiary

Goldman Sachs: Moving the metal

Goldman Sachs purchased Metro International in 2010, when Goldman purchased the company, aluminum purchases were generally delivered in about six weeks. However, in 2013, aluminum deliveries averaged about 16 months. Goldman, which owns the warehouses that it moves the aluminum to and from can charge storage fees that drive up the cost of the ubiquitous metal. While Goldman maintains that it complies with the standards set by the London Metal Exchange but that hasn’t made Congress and others happy.

Last month, Goldman found itself in front of the Senate Permanent Subcommittee on Investigations chaired by Sen. Carl Levin. Levin is not a fan of Goldman Sachs, JPMorgan Chase and Morgan Stanley’s ownership of aluminum warehouses in Detroit, coal mines in Colombia and a uranium trading company in London believing that banks shouldn’t be involved in commodity markets.

Prior to the hearing late last month, Goldman Sachs had suggested that it was looking to shed the aluminum business but didn’t stop Levin from airing quite a few contentious remarks.

The Senate hearing

“I’m glad that at least two of the three of you are pulling back significantly,” Senator Levin said to a panel of executives from the aforementioned banks referring to Goldman’s aluminum business.

“The warehouse issue is having a profoundly negative impact on our customers’ businesses,” said Nick Madden, the chief supply chain officer at Novelis, a producer of rolled aluminum on the second day of hearings. Other Senators were only happy to bash Goldman and may have been directly or indirectly responsible for the sale to European private equity firm, Ruben Brothers.

Terms of the deal were not disclosed on Thursday.

Despite the fact that Goldman Sachs suggested it was looking to lose the aluminum warehouse business, they made it very clear that the bank had every intention of continuing to work in the commodities arena.