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Article: From Bernie Madoff to Steven Cohen, Enabling Suspiciously High Returns

Article - Media, Publications

From Bernie Madoff to Steven Cohen, Enabling Suspiciously High Returns

Jesse Eisinger, 12 December 2012

To have one employee tied to insider trading may be regarded as a misfortune. But, with apologies to Oscar Wilde, to have six looks like carelessness.

Poor Steven A. Cohen, the powerful hedge fund manager who heads SAC Capital Advisers. People he employs just keep getting swept up in the sprawling insider trading investigation that has spanned years now. In addition to the six who have gotten in trouble for activities when employed at SAC, at least six others have been ensnared by insider trading investigations after leaving the firm. The latest arrest, of the pharmaceutical industry analyst Mathew Martoma, is the first that ties Mr. Cohen to trades the government says were illegal. Continue reading “Article: From Bernie Madoff to Steven Cohen, Enabling Suspiciously High Returns”

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Article: The Bare, Naked Truth About The Federal Reserve’s Socialist Agenda

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The Bare, Naked Truth About The Federal Reserve’s Socialist Agenda

Shah Gilani

Money Morning, 11 December 2012

The top line story, according to the FDIC’s latest Quarterly Banking Review, is that the majority of U.S. banks are in better shape today than they have been in years.

The untold story is that when the Federal Reserve is done transitioning the United States from capitalism to socialism, the few dozen banks that remain in America will all be profitable until they need bailing out again, but will never die and live on in infamy.

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Article: HSBC pays record $1.9bn fine to settle US money-laundering accusations

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HSBC pays record $1.9bn fine to settle US money-laundering accusations

Jill Treanor and Dominic Rushe,  11 December 2012

HSBC was guilty of a “blatant failure” to implement anti-money laundering controls and wilfully flouted US sanctions, American prosecutors said, as the bank was forced to pay a record $1.9bn (£1.2bn) to settle allegations it allowed terrorists to move money around the financial system.

Hours after the bank’s chief executive, Stuart Gulliver, said he was “profoundly sorry” for the failures, assistant attorney general Lanny Breuer told a press conference in New York that Mexican drug traffickers deposited hundreds of thousands of dollars each day in HSBC accounts. At least $881m in drug trafficking money was laundered throughout the bank’s accounts. Continue reading “Article: HSBC pays record $1.9bn fine to settle US money-laundering accusations”

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Article: NY Insider trading: Bharara is after Steven Cohen, not Mathew Martoma

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NY Insider trading: Bharara is after Steven Cohen, not Mathew Martoma

SUttara Choudhury, 28 November 2012

Manhattan US Attorney Preet Bharara, who has won guilty convictions against high-profile Galleon Group billionaire Raj Rajaratnam and former Goldman Sachs director Rajat Gupta, is not resting on his laurels.

Since the crackdown on insider trading began five years ago on Wall Street, there have been more than 70 arrests. Manhattan US Attorney Preet Bharara, who has won guilty convictions against high-profile Galleon Group billionaire Raj Rajaratnam and former Goldman Sachs director Rajat Gupta, is not resting on his laurels. Continue reading “Article: NY Insider trading: Bharara is after Steven Cohen, not Mathew Martoma”

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Article: SAC Capital and Steven Cohen: Insider Trading is a Fog That Haunts Wall Street

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SAC Capital and Steven Cohen: Insider Trading is a Fog That Haunts Wall Street

Here we go again, another insider trading accusation on the heels of the Raj Rajaratnam conviction and sentencing. It involves SAC Capital Advisors and a former employee, Matthew Martoma.

The entire episode is detailed in a New York Times article in Monday’s paper. The allegations of insider trading are very serious and could have ramifications to many more individuals before it is over.

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Article: Insider trading case targets big donor

Article - Media, Publications

Insider trading case targets big donor

Steven A. Cohen, the multibillionaire hedge fund owner implicated in an insider-trading scandal, is a major political donor who has contributed heavily to big players in both parties.

Cohen and his wife, Alexandra, have donated more than $450,000 to the campaign committees and leadership PACs of Senate Majority Leader Harry Reid (D-Nev.), Senate Minority Leader Mitch McConnell (R-Ky.), House Majority Leader Eric Cantor (R-Va.) and other key lawmakers during the past several election cycles, Federal Election Commission records show.

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Article: Is The Federal Reserve Using Money-Laundering Techniques To Cleanse Banks’ Balance Sheets?

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Is The Federal Reserve Using Money-Laundering Techniques To Cleanse Banks’ Balance Sheets?

Lawrence Hunter

Forbes, 29 October  2012

Drug lords, terrorists and shadow-government operators (but I repeat myself) use third party intermediaries to cool off and sanitize hot, dirty, and therefore useless money into pristine-clean and productive money that can be used in legitimate commerce. It’s called money laundering.

Characters operating in the shadows also use a form of reverse money laundering to defile clean money or redirect dirty money while masquerading its source so it can be siphoned away, re-channeled and put to use financing illicit activities such as terrorism and off-the-books, shadow-government operations (but I repeat myself, again) that Congress won’t authorize or fund. Think of it as repatriating dirty money and expatriating clean money.

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Article: EU ban on naked CDS short worries Asian investors

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EU ban on naked CDS short worries Asian investors

Christopher Langner, Christopher Whittall, IFR, 23 October 2012

Some Asian fixed-income investors are grappling with how to hedge high-beta portfolios on the eve of the implementation of a ban on naked shorting of European sovereign CDS.

Until March this year, using European CDS bets to offset potential losses from a drop in prices of Asian high-yield bonds had become a fairly popular strategy. However, since regulators in Europe said they were banning the practice from November 1, many of those bets were unwound. Continue reading “Article: EU ban on naked CDS short worries Asian investors”

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Article: UBS rogue trader’s $2.3-billion ‘naked gamble’ nearly destroyed bank, court told

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UBS rogue trader’s $2.3-billion ‘naked gamble’ nearly destroyed bank, court told

Estelle Shirbon, Michael Holden

Reuters, 14 September 2012

Former UBS trader Kweku Adoboli arrived at Southwark Crown Court in London Sept. 14, 2012. Adoboli, was arrested a year ago when a loss of $2.3-billion came to light, and was charged with fraud and false accounting.

Paywall access to article.

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Fine: Fordham Financial Management Fined by FINRA

Fined

Fordham Financial Management Fined by FINRA

FINRA, August 2012

Fordham Financial Management submitted a Letter of Acceptance, Waiver and Consent in which the firm was censured and fined $10,000. Without admitting or denying the findings, the firm consented to the described sanctions and to the entry of findings that it improperly reported Execution or Combined Order/Execution Reports to OATS with a reporting exception code of “M.” The findings stated that the firm transmitted reports to OATS that contained inaccurate capacity codes.

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Filing: Anschutz Corp. v. Merrill Lynch & Co., Inc., 11-1305

Filing

Anschutz Corp. v. Merrill Lynch & Co., Inc., 11-1305

FindLaw, 14 August 2012

In a suit against Merrill Lynch and others, claiming market manipulation, fraud, control person liability, and negligent misrepresentation, district court’s judgment in favor of the defendants is affirmed where: 1) the market manipulation claims fail for the same reasons identified in Wilson v. Merrill Lynch & Co., which held that the same website disclosure at issue in this case contained sufficient information about Merrill Lynch’s support bidding practices to preclude a market manipulation claim; 2) district court properly dismissed the California Corporations Code claims as plaintiff fails to allege any injury or unlawful conduct in California; and 3) district court properly dismissed the negligent misrepresentation claims against the Rating Agency defendants as plaintiff fails to allege an actionable misrepresentation under New York law.

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Article: Barron’s Gary Weiss Caught Plagiarizing Matt Taibbi, Find-Replaces Style With Spin

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Barron’s Gary Weiss Caught Plagiarizing Matt Taibbi, Find-Replaces Style With Spin

Patrick Byrne

DeepCapture, 7 August 2012

Two months ago a schlubby-but-savage Goldman lawyer named Joseph E. Floren made a mistake that caused some previously redacted information about Goldman Sachs to slip into the public’s hands. The event was ably covered by such globally-respected publications as Bloomberg, the Economist, and Rolling Stone.

Since May I have wondered, With the truth emerge at last in publications such as Economist, Bloomberg, and Rolling Stone, surely the Bad Guys must understand they have lost control of the narrative. Surely, I thought, they are working out some new damage control strategy to deflect or usurp the truth as it comes out.

And as always, Gary Weiss doesn’t let us down.

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Article: HSBC scandal further erodes credibility of UK banking industry

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HSBC scandal further erodes credibility of UK banking industry

AFP, 22 July 2012

London: A scandal erupting at Europe’s biggest bank HSBC has added to concerns over the state of Britain’s financial sector amid the Barclays rate rigging affair and as the industry faces a major shake-up.

HSBC last week apologised and its head of compliance David Bagley resigned after US lawmakers accused the London-based bank of failing to apply anti-laundering rules, benefitting Iran, terrorists and drug dealers.

The HSBC affair follows hot on the heels of the Libor interest rate rigging scandal that has brought down top executives at Britain’s Barclays bank — most notably its chief executive Bob Diamond and chairman Marcus Agius.

Regulators are reportedly investigating HSBC, as well as Credit Agricole, Deutsche Bank and Societe Generale, over alleged manipulation of the Libor rate after Barclays was recently fined £290 million (Dh1.66 billion) over the affair.

Britain’s financial regulator, the Financial Services Authority (FSA), has said its Libor probe is looking at seven groups, which are not only British institutions.

Bank of England governor Mervyn King has meanwhile proposed that central bank governors and regulators discuss Libor reform at their upcoming meeting in Basel, Switzerland, on September 9.

Barclays has admitted attempting to manipulate the Libor and Euribor rates between 2005 and 2009.

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Article: FERC probes JPMorgan over electricity charges

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FERC probes JPMorgan over electricity charges

Katarzyna Klimasinska

SF Gate, 3 July 2012

JPMorgan Chase & Co. is being investigated over potential power-market manipulation that inflated payments for electricity, according to the U.S. Federal Energy Regulatory Commission.

FERC, which has pledged to combat manipulation of prices, began its probe after reports last year of bidding practices by JPMorgan that were deemed abusive by California and Midwest grid operators, according to documents provided by the agency.

Read full article.