Investor intelligence! Lack there of! At least 70 investors coughed up a total of $5.77 million to a a fictitious financial firm called Dresdner Financial, according to charges announced by the Securities and Exchange Commission.
The scheme, according to the SEC, involved an outlandish promise: Read More
The notion that the complexity of securities law makes white collar cases difficult for prosecutors to win is pretty broadly accepted these day—indeed, to the extent that the jury that acquitted former Citigroup executive Brian Stoker of civil charges this summer urged the Securities and Exchange Commission not to be discouraged by the verdict.
Well, there’s moral complexity (who’s ultimately responsible?), there’s procedural complexity (how do you explain financial concepts to a jury?) and then there’s the somnial complexity, the daunting task of keeping a jury awake. Read More
It gets worse in Spain. In the run-up to the current crisis, banks sold retail customers 22 billion euros of high-yielding preferred shares. Bank losses deepened, the securities plunged in value and the retail customers saw their savings diminished, and in some cases, locked in an illiquid product. Now, angry Spaniards are finding Read More
Paul Singer’s Elliot Capital Management seized a training ship owned by the Argentinean navy after the hedge fund won a court decision ruling that the South American nation still owes on a 2001 bond offering.
The European Stability Mechanism may guarantee the first 20 to 30 percent of potential losses on new Spanish debt, according to Reuters. The plan would be aimed at saving Spain without depleting Europe’s rescue funds. Read More
Putting a new spin on an old sobriquet, the Securities and Exchange Commission announced charges against Goldman Sachs and a former vice president at the firm for making undisclosed contributions to the gubernatorial campaign of a former Massachusetts state treasurer.
Goldman—sometimes referred to as “Government Sachs” because former executives (Bob Rubin, Josh Bolten, Hank Paulson … it goes back to Sidney Weinberg, doesn’t it?) have a habit of going to work in Washington—found itself in the SEC’s sights after a former Goldman vice president named Neil M.M. Morrison lent a hand to then Massachusetts Treasurer Timothy P. Cahill, who was running for governor.
According to the agency, Mr. Morrison was “substantially involved” in Mr. Cahill’s campaign from November 2008 to October 2010, during which period Goldman was involved in underwriting 30 debt offerings for the state: Read More
When former Minnesota governor Tim Pawlenty was campaigning to be the Republican presidential nominee, he told reporters that his “truth message to Wall Street is going to be, ‘Get your snout out of the trough.’” Which, maybe that’s still his truth message? But instead of delivering it as co-chairman of Mitt Romney’s campaign, Governor Pawlenty will be speaking it as head of the Financial Services Roundtable, a banking industry lobby.
Somewhere, an algorithm read the coverage of yesterday’s Senate Banking Committee hearing on high-frequency trading, and figured it will take years for the government to hammer out reforms to fix market structure issues. Read More
JPMorgan’s board of directors is weighing lower bonuses for CEO Jamie Dimon and other top executives in light of the $5.8 billion trading loss the firm suffered this year, according to The Wall Street Journal; Citigroup is also looking at executive pay in an attempt to appease shareholders.
Kweku Adoboli, the former UBS trader Read More
A federal appeals court revived a pair of securities cases in decisions handed down today, reinstating a lawsuit charging Goldman Sachs with misleading mortgage investors, as well as a 10-year-old insider trading case brought against a hedge fund manager. Read More
Songwriter, novelist and erstwhile investment adviser Gary Marks—also the author of investing guide Rocking Wall Street—agreed to pay $421,000 to settle Securities and Exchange Commission charges that he negligently misrepresented the correlation and diversification among some of the funds he managed.
The nitty-gritty, according to the SEC: Between 2005 and 2007, Mr. Marks managed several funds-of-funds and told investors that the funds weren’t correlated, when in fact a) they were and b) he “did not even know how to properly perform such an analysis.” Read More
Lawsuits against financial institutions under investigation for manipulating interbank lending rates such as Libor continue to pile up, according to The Wall Street Journal. Plaintiffs holding bonds that pay some amount above the Libor rate have the best chances at legal victory, The Journal says. The legal liability facing banks may total as much as Read More
