“New York’s banking regulator, Benjamin Lawsky, has ticked off the financial sector and even his fellow regulators by being, well, zealous in his job. Now he’s taking aim at one of the most cherished practices in the regulatory biz: disciplining institutions while letting their individual wrongdoers skate. “In an interview published Monday in the Financial […]
“Some 18 months ago, the board of Britain’s biggest bank heralded the coming of a “new” Barclays. The culture would change. Greed might not be abolished, but it would not drive the institution. Shareholders, clients and the public would benefit from a better balance between behaviour and profit; between employee compensation and shareholder return. “Last […]
“A Louisiana man who helped federal prosecutors make their case against JPMorgan Chase’s mortgage lending practices has earned $63.9 million for his efforts. “The government will pay the amount to Keith Edwards, the whistle-blower who originally sued the bank last year, according to a filing in a United States District Court in Manhattan on Friday. […]
“WASHINGTON — Lawmakers will hold their first hearing Tuesday on an issue that has largely mystified regulators: how to craft capital rules for insurance companies. “It is one of the biggest unanswered questions of the post-financial regulatory system nearly four years after the passage of the Dodd-Frank Act, and has been raised frequently at other […]
“Washington’s effort to push banks out of the mortgage-servicing business is propelling the handling of customers’ loans into companies such as hedge funds and nonbank financial firms. “The shift is fueling concern among federal and state regulators about the level of oversight and capital requirements in the industries now servicing a growing share of these […]
“The email from a Credit Suisse executive was blunt: The bank seemed to be pushing through risky home mortgages from questionable applicants. “One borrower, the executive wrote, appeared to be a gas station attendant who was living with his mother while claiming to make $93,000 a year. Another was a former sales clerk at Nordstrom […]
“Among my favorite anecdotes of the mortgage-industry decadence that preceded the global financial crisis is the one about Ameriquest’s wind machine. A motivational tool for managers, it made its appearance in the late ’90s at an executive conference at Las Vegas’s MGM Grand Hotel, where the future subprime leader hooked up a powerful fan to […]
“BUSINESS has always been plagued by fraud: witness the South Sea Company in the 1710s (which enveloped the British economy in a giant bubble) or Charles Ponzi’s Securities Exchange Company in 1920 (which gave the world the Ponzi scheme) or the Enron and WorldCom scandals in the early 2000s. Ambitious fraudsters are attracted to businesses […]
“Home-equity lending surpassed 2009 levels in 2013, with $111 billion in new home equity lines of credit (HELOCs) opened. In the fourth quarter, new lending increased 43% from quarter four 2012, according to data from Experian-Oliver Wyman Market Intelligence Reports and Experian’s IntelliView tool.” “For those familiar with the events leading up to the financial crisis in […]
“Thousands of Credit Suisse Group AG (CSGN)’s U.S. clients still don’t know whether tax authorities will learn their identities as prosecutors work to conclude a three-year probe of how the bank helped them evade taxes.” “U.S. senators last week faulted the Justice Departmentfor securing names for only 238 of 22,000 Americans with Credit Suisse accounts, saying the […]
WASHINGTON —“Since the Consumer Financial Protection Bureau burst onto the financial stage a few years ago, it has made a steady stream of controversial moves.” “None are more despised by bankers than the agency’s use of statistical differences in the loan terms offered to different ethnic groups to sue creditors for unintentional racial bias.” “In […]
“Federal Reserve officials will consider rewriting the guidance they give the public about the likely path of short-term interest rates when they meet later this month, according to William Dudley, president of the Federal Reserve Bank of New York.” “The Fed has been saying since December 2012 that it won’t even consider raising its target short-term […]
(Reuters) – “Detroit said in a court filing on Thursday it had reached an agreement with Barclays PLC for a $120 million loan that would allow it to invest in services and speed its path out of bankruptcy.” “The deal comes after the judge overseeing Detroit’s historic bankruptcy case rejected a $350 million loan that would […]
“Federal securities regulators have won a partial victory against two brothers accused of trading on inside information in 2009 about French pharmaceutical company Sanofi’s plan to buy a Tennessee-based company.” A jury in the U.S. district court in Cleveland, Ohio, found that Andrew Jacobs and Leslie Jacobs committed insider trading in the context of a […]
“The former leadership of Dewey & LeBoeuf has been charged by US authorities with ‘a massive effort to cook the books’ nearly two years after the law firm’s record-breaking collapse.” “The firm’s former chairman, executive director and chief financial officer all face criminal charges filed in an indictment by the Manhattan district attorney, and civil charges […]
“On one side of the National Mall in Washington DC the Senate held a confirmation hearing on three Commodity Futures Trading Commission nominees, while on the other side the House of Representatives appropriations committee heard yet another desperate plea from the acting CFTC commissioner for additional funding. It’s hard to determine which hearing was the […]
“It is unusual for a senior government official to produce a short, clear analytical paper. It is even rarer when the official’s argument both cuts to the core of the issue and amounts to a devastating critique of the existing order.” “In a speech delivered on February 24, Thomas M. Hoenig, vice chairman of US’s […]
“President Barack Obama’s nominee to head the Commodity Futures Trading Commission will pledge to aggressively enforce rules against misconduct and beef up oversight of derivatives markets in a Senate hearing Thursday.” “Timothy Massad is expected to point to his time spent overseeing the Treasury Department’s bank-rescue program for the past three years, noting that derivatives played […]
“The Supreme Court on Wednesday seemed ready to impose new limits on securities fraud suits that would make it harder for investors to band together to pursue claims that they were misled when they bought or sold securities. But the justices did not seem inclined to issue a ruling that would put an end to […]
SEATTLE/ MEXICO CITY/ WASHINGTON (Reuters) –“ Federal Reserve Chair Janet Yellen vowed on Wednesday to “do all that I can” to boost a U.S. economy where unemployment is too high and inflation is too low.” “The economy continues to operate considerably short” of the central bank’s objectives of full employment and stable prices, Yellen said […]
“In less than two years, stockbroker Marcos D. Leiva racked up a personal bankruptcy, a tax lien, a court judgment for unpaid debt and a criminal guilty plea relating to a false report to law enforcement.” “Each should have been promptly disclosed to investors. None was.” “Mr. Leiva is one of more than 1,600 stockbrokers […]
“It remains one of Wall Street’s most puzzling mysteries: What exactly did JPMorgan Chase bankers know about Bernard L. Madoff’s Ponzi scheme?” “A newly obtained government document explains why — five years after Mr. Madoff’s arrest spotlighted his ties to JPMorgan and later led the bank to reach a $2 billion settlement with federal authorities — the picture is […]
“Payouts for the top executives in private equity have rocketed into the stratosphere, thanks to a soaring stock market and shrewd maneuvers by their firms in the aftermath of the financial crisis.” “But the millions upon millions in earnings disclosed in recent days were so great that the same executives may not be able to reap quite […]
“The Bank of England said on Wednesday that it had suspended an employee as it escalated a review into whether bank officials had known about or condoned potential manipulation of the currency markets.” “The British central bank also released minutes of meetings between officials and industry representatives that indicated that there were concerns about possible manipulation for rates like […]
“President Obama’s latest budget, released Tuesday, contains few surprises for the banking industry several years after the financial crisis, with the focus instead turning to education and employment in an effort to reboot the stagnating economy.” “The $3.9 trillion budget request for fiscal year 2015 is designed to reinforce Democrats’ focus on the middle class […]
“Barclays Plc (BARC), Deutsche Bank AG (DBK) and three other banks were accused in a lawsuit of manipulating the London gold fix, a benchmark used throughout the $20 trillion market for the metal.” “Kevin Maher, a New York resident who said he bought and sold gold and gold futures and options, sued yesterday in Manhattan federal court claiming the […]
“The head of the Justice Department division in charge of prosecuting white-collar crime—who is stepping down later this month—says she’s leaving behind plenty of big financial cases for her successor to tackle.” “‘I do think my successor will have a lot to do, and that’s good,’ said Mythili Raman, acting assistant Attorney General for the Justice Department’s […]
“First, there was the TruPs crisis, as everyone surely recalls.” “No?” “Well, after the Volcker Rule was completed, some banks suddenly realized that they might have to sell some obscure holdings to conform to the rule — bundles of investments in banks, called trust-preferred securities, or TruPs. The American Bankers Association reacted immediately, warning that the nation’s […]
“Timothy Massad, the Treasury Department official named to head the U.S. Commodity Futures Trading Commission, said he would work to approve speculation limits in oil, natural gas and other commodities that have been resisted by banks and parts of the energy industry.” “Massad and commission nominees Sharon Y. Bowen and J. Christopher Giancarlo told Senate Agriculture […]
“Not for the first time, Citigroup has stepped into a mess – and by extension besmirched the financial industry. Not that Citi committed a crime, or colluded to set foreign exchange rates or Libor prices, say. Rather the bank is the victim of fraud in Mexico that could cost it much as $400 million. The problem […]
“Do markets still view the nation’s largest banks as too big to fail? Have regulators failed to eradicate the perception that, when the next crisis comes, the government will again come to the rescue?” “Given that the largest banks are now even bigger than they were before the last financial crisis, it’s a pressing question. […]
“In speaking about the leverage ratio, an extremely important bank capital requirement, Thomas Hoenig, vice chairman of the Federal Deposit Insurance Corporation, said: ‘I think we’ve got the details worked out. Now it’s just getting the schedule.’” “His comments on Monday at a National Association for Business Economics conference are the biggest hint that United […]
“The Federal Reserve this month will take a step toward revealing more about its oversight of the financial system, an area where the central bank has yet to match the strides it has taken toward transparency in monetary policy.” “With the scheduled publication of annual stress-test findings in March, the Fed will for the first […]
“Like many in the fall of 2008, Amit Chatwani was done. Lehman Brothers had collapsed, the government had bailed out the American International Group, and the financial system was in chaos.” “It was not the best time for Mr. Chatwani to continue writing his blog, Leveraged Sell-Out , a parody of the musings of young Wall Street […]
“JPMorgan Chase is trying to put its troubles behind it. Having agreed to pay a $13 billion settlement to the government for its past mortgage-lending misdeeds, it wants to move on. At the big ‘Investor Day’ meeting with shareholders last week, Jamie Dimon, its chief executive, and his top lieutenants extolled the bank’s strong and diversified position in […]
“A headache is growing for Citigroup as a banking affiliate involved in money transfers across the Mexican border has become ensnared in a criminal investigation.” “The disclosure of the inquiry on Monday follows the bank’s admission on Friday that it had been defrauded of $400 million in a scheme involving a financially shaky oil services company in Mexico.” “A Citigroup […]
“Good news, Brady Dougan! It took a few days for dirt to kick up around another big bank, after Credit Suisse got in trouble over clients and tax evasion – but Citigroup delivered eventually. The bank said on Friday that 2013 earnings would take a retroactive hit after fraud in its prized Mexican unit, Banamex.” “These unpleasant situations have, first, […]
“The Securities and Exchange Commission is investigating the way investors are given allocations of bonds in sought-after offerings, such as the Verizon Communications issue, according to people familiar with the matter.” “Requests for information have been sent to banks including Goldman Sachs and Citigroup, as officials examine whether representations were made by customers in an attempt to procure bonds they otherwise […]
“Royal Bank of Scotland is set to become the latest European bank to sharply pare back its US business in response to new rules from the Federal Reserve.” “The UK lender is planning to more than halve the assets in its broker-dealer operation in New York in order to pull assets below the $50bn threshold at […]
“Should the biggest fund management groups be regulated as systemically important financial groups, in the same way as the biggest global banks? The US Treasury’s Office of Financial Research has asked this question, and is inclined to answer “yes”. The fund management industry disagrees.” “The question is central to the attempt to engineer a financial system, […]
“A few things are known about the Department of Justice‘s record $13 billion settlement with JP Morgan Chase to resolve civil claims in connection with the huge bank’s marketing and sale of mortgage-backed securities.” “Most of them, unfortunately, are included in the above paragraph.” “Was it ‘a political shakedown and wealth redistribution scheme’ that victimized the bank, as […]
“A headache is growing for Citigroup as a banking affiliate involved in money transfers across the Mexican border has become ensnared in a criminal investigation.” “The disclosure of the inquiry on Monday follows the bank’s admission on Friday that it had been defrauded of $400 million in a scheme involving a financially shaky oil services company in Mexico.” “A Citigroup […]
HONOLULU —“ Larger banks have unseated regulators as the bogeyman standing in the way of small banks’ survival.” “Compliance remains a concern, but exemptions and last-minute changes to various rules and regulations have certainly helped to ease the sting at smaller institutions. Numerous attendees at the Independent Community Bankers of America’s annual conference here are […]
WASHINGTON —“Financial institutions are raising concerns anew about a set of regulations that they say are forcing banks out of the servicing business as they sell their rights to nonbanks.” “Regulators finalized Basel III rules last summer that placed significant restrictions on banks’ ability to hold mortgage servicing rights, particularly for smaller institutions. As a […]
“The Obama administration has just opened a new front in its ongoing war on whistleblowers. It’s taking its case against one man, former Transportation Security Administration (TSA) Air Marshal Robert MacLean, all the way to the Supreme Court. So hold on, because we’re going back down the rabbit hole with the Most Transparent Administration ever.” “Despite all […]
“The budget for fiscal year 2015 released by President Barack Obama Tuesday includes increased funding for two regulatory bodies tasked with policing Wall Street. Obama proposed raising funding levels for both the Securities and Exchange Commission and the Commodity Futures Trading Commission by more than 25%. Both agencies are charged with implementing the restrictions imposed on the financial industry by the Dodd-Frank […]
“Private-equity kingpins made billions last year subsidized by you, the taxpayer.” “The nine highest-paid private-equity executives in the U.S. hauled in more than $2.6 billion in 2013, The Wall Street Journal’s Ryan Dezember reported on Tuesday, citing regulatory filings by their firms. That’s not a misprint: Just nine human beings split a $2.6 billion jackpot last year.” […]
“Here’s a twist in the government’s recent crackdown on insider selling: One of the main regulators tasked with policing the illegal practice may be instructing its employees to do just that.” “Securities and Exchange Commission employees regularly sell shares of companies in their personal portfolios that come under investigation by the agency before those investigations […]
“Adding job growth to monetary policy models that rely on the unemployment rate alone make them better predictors of Federal Reserve policy over time, a Cleveland Fed paper released Tuesday finds.” “There is a perennial debate among economists, highlighted in Tuesday’s edition of Grand Central, about whether to pursue “rules-based” policies or opt for a more flexible approach.” “In particular, […]
(Reuters) – “Former Federal Reserve Chairman Ben Bernanke said the U.S. central bank could have done more to fight the country’s financial crisis and that he struggled to find the right way to communicate with markets.” “‘We could have done some things on the margin to mitigate somewhat the crisis,’ Bernanke, 60, said on Tuesday in […]
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