Tag: Bank of America

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Article: Regulators fine global banks $4.3 billion in currency investigation

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Regulators fine global banks $4.3 billion in currency investigation

Kirstin Ridley, Joshua Franklin, Aruna Viswanatha, 12 November 2014

Regulators fined six major banks a total of $4.3 billion for failing to stop traders from trying to manipulate the foreign exchange market, following a yearlong global investigation.

HSBC Holdings Plc, Royal Bank of Scotland Group Plc, JPMorgan Chase & Co, Citigroup Inc, UBS AG and Bank of America Corp all faced penalties resulting from the inquiry, which has put the largely unregulated $5-trillion-a-day market on a tighter leash, accelerated the push to automate trading and ensnared the Bank of England.

Authorities accused dealers of sharing confidential information about client orders and coordinating trades to boost their own profits. The foreign exchange benchmark they allegedly manipulated is used by asset managers and corporate treasurers to value their holdings.

Dealers used code names to identify clients without naming them and swapped information in online chatrooms with pseudonyms such as “the players”, “the 3 musketeers” and “1 team, 1 dream.” Those who were not involved were belittled, and traders used obscene language to congratulate themselves on quick profits made from their scams, authorities said.

Wednesday’s fines bring total penalties for benchmark manipulation to more than $10 billion over two years. Britain’s Financial Conduct Authority levied the biggest penalty in the history of the City of London, $1.77 billion, against five of the lenders.

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Article: Six banks fined £2.6bn by regulators over forex failings

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Six banks fined £2.6bn by regulators over forex failings

BBC NEws , 12 November 2014

Six banks have been collectively fined £2.6bn by UK and US regulators over their traders’ attempted manipulation of foreign exchange rates. HSBC, Royal Bank of Scotland, Swiss bank UBS and US banks JP Morgan Chase, Citibank and Bank of America have all been fined.

A separate probe into Barclays is continuing. The fines were issued by the UK’s Financial Conduct Authority (FCA) and two US regulators.

The country’s Commodity Futures Trading Commission (CFTC) issued fines of $1.4bn to five banks, while the Office of the Comptroller of the Currency (OCC) added $950m in further fines to three lenders. Separately, the Swiss regulator, FINMA, has penalised UBS 134m Swiss francs.

Barclays, which had been expected to announce a similar deal to the other banks, said it would not be settling at this time.

“After discussions with other regulators and authorities, we have concluded that it is in the interests of the company to seek a more general coordinated settlement,” it said in a statement.

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Article: FINRA Fines Merrill Lynch $6 Mln for Failing to Prevent Naked Short Selling

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FINRA Fines Merrill Lynch $6 Mln for Failing to Prevent Naked Short Selling

Victor Golovtchenk, 28 October 2014

According to an announcement by the U.S. Financial Industry Regulatory Authority (FINRA), U.S. bank Merrill Lynch’s Professional Clearing Corp. (Merrill Lynch PRO) got fined $3.5 million for violating Regulation SHO. The Securities and Exchange Commission (SEC) implemented this rule in 2005 to prevent the conducting of a practice called naked short selling.

Merrill Lynch’s affiliated broker-dealer Pierce, Fenner & Smith Incorporated (Merrill Lynch) has also been fined $2.5 million for failing to establish, maintain and enforce supervisory systems and procedures related to Regulation SHO and other areas, according to the FINRA announcement. Continue reading “Article: FINRA Fines Merrill Lynch $6 Mln for Failing to Prevent Naked Short Selling”

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Article: How to Explain the Number of Financial Crimes on Wall Street

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How to Explain the Number of Financial Crimes on Wall Street

Robert Lenzner, 17 June 2021

I ask everyone how to explain the stunning number of financial crimes we have witnessed the last several years and never get an adequate clear answer. The reason: it’s not easy to grasp why Bank of America , Citigroup , BNP-Paribas, UBS , Credit Suisse, JP Morgan Chase and a bevy of giant hedge funds are sweating their way through the demand for fines in the tens of billions or potential jail sentences as long as decades.

One reason it’s hard is that prosecution of the crimes comes so many years later than the crimes themselves. It’s hard to contemplate so many banks of marketing garbage mortgages, or laundering money for Iran, Sudan, and other rogue nations or radical groups, or secret bank accounts in Switzerland. The cops on the beat take much more time to act than the actual crimes took. Continue reading “Article: How to Explain the Number of Financial Crimes on Wall Street”

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Article: Naked Gold Shorts: The Hows and Whys of Gold Price Manipulation

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Naked Gold Shorts: The Hows and Whys of Gold Price Manipulation

Commodity Trade Mantra, 20 January 2014

The deregulation of the financial system during the Clinton and George W. Bush regimes had the predictable result: financial concentration and reckless behavior. A handful of banks grew so large that financial authorities declared them “too big to fail.” Removed from market discipline, the banks became wards of the government requiring massive creation of new money by the Federal Reserve in order to support through the policy of Quantitative Easing the prices of financial instruments on the banks’ balance sheets and in order to finance at low interest rates trillion dollar federal budget deficits associated with the long recession caused by the financial crisis.

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Article: Secrets and Lies of the Bailout

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Secrets and Lies of the Bailout

Matt Taibbi

Rolling Stone, 4 January 2013

It has been four long winters since the federal government, in the hulking, shaven-skulled, Alien Nation-esque form of then-Treasury Secretary Hank Paulson, committed $700 billion in taxpayer money to rescue Wall Street from its own chicanery and greed. To listen to the bankers and their allies in Washington tell it, you’d think the bailout was the best thing to hit the American economy since the invention of the assembly line. Not only did it prevent another Great Depression, we’ve been told, but the money has all been paid back, and the government even made a profit. No harm, no foul – right?

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Article: The Federal Reserve Bank is Naked: QE 10T Dollar ‘Loans’ Swaps and Naked Mortgage Bonds of Quantitative Easing 1

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The Federal Reserve Bank is Naked: QE 10T Dollar ‘Loans’ Swaps and Naked Mortgage Bonds of Quantitative Easing 1

Lan Pham

Economics Voodoo, 28 December 2012

The banking and financial crisis emerging in September 2008 is often called a global financial crisis, but to be more precise the data point to a crisis of the Western central banks. I referenced euros previously, so this is the euros companion to Quantitative Easing 0-1-2-3∞ & The Federal Reserve’s Love Affair with its Banks and Mortgage Bonds: Levitating The Black Hole. QE 0-1-2-3 is incomplete as concurrently the Federal Reserve Bank also entered into $10.06 Trillion in dollar ‘loans’ liquidity swaps with foreign central banks that we examine in Section I. Why QE $10T as we look at a few of Europe’s largest banks in Section II, which leads us to the $1.25 Trillion naked reasons behind the Federal Reserve Bank’s Quantitative Easing I purchase of phantom agency mortgage bonds that we revisit more closely in Section III.

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Article: Goldman, Merrill E-Mails Show Naked Shorting, Filing Says

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Goldman, Merrill E-Mails Show Naked Shorting, Filing Says

Karen Gullo, 16 May 2012

Goldman Sachs Group Inc. (GS) and Merrill Lynch & Co. employees discussed helping naked short-sales by market-maker clients in e-mails the banks sought to keep secret, including one in which a Merrill official told another to ignore compliance rules, Overstock.com Inc. (OSTK) said in a court filing.

The online retailer accused Merrill, now part of Bank of America Corp., and Goldman Sachs of manipulating its stock from 2005 to 2007, causing its shares to fall. Clearing operations at the banks intentionally failed to locate and deliver borrowed shares for clients shorting stocks, including two traders who were fined and suspended from the industry, Overstock’s attorneys said in court filings earlier this year.

Lawyers for Overstock, whose California state court lawsuit inSan Francisco was dismissed in January, asked a judge to make public e-mails sent in 2005 and 2006 that it said “reflect business decisions to put profits and corporate ambition over compliance” at Goldman Sachs and Merrill. The banks’ decisions to intentionally fail to deliver Overstock shares caused large- scale naked short selling of the company’s stock, according to the filing. Continue reading “Article: Goldman, Merrill E-Mails Show Naked Shorting, Filing Says”

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Article: SEC under Schapiro struggles to turn around amid political, financial head winds

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SEC under Schapiro struggles to turn around amid political, financial head winds

David S. Hilzenrath

Washington Post, 7 October 2011

Mary L. Schapiro took over a discredited SEC in early 2009 and vowed to rebuild it.

She promised tougher enforcement — “war without quarter” on financial fraud. Modernized rules to keep up with Wall Street. And a new, more effective organization.

Her tenure at the federal agency responsible for protecting investors and policing markets offers a Washington lesson: Even when epic crises create a sense of urgency, it is tough to tighten the reins on powerful industries. Dramatic results can prove elusive.

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Article: Bank of America: Bondholders’ Naked Play for a “Do-Over” on Mortgages

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Bank of America: Bondholders’ Naked Play for a “Do-Over” on Mortgages

Marion Maneker

CBS, 20 October 2010

Yesterday’s Bank of America (BAC) bond scare was an interesting reminder of just how much of a mess the foreclosure crisis really is. It may not be the same kind of swoon we experienced two years ago, but the vulnerabilities created by the shoddy mortgage origination and servicing industry will probably haunt the financial system for years to come — like war reparations.

It took a while for the financial world to sort out the meaning of the letter PIMCO, Blackstone and the New York Federal Reserve Bank sent to Bank of America yesterday asking that $47 billion in bonds be “put back” to the bank because of deficient servicing by Countrywide, the Bank of America subsidiary that originated the loans. The markets and the journalistic community can be forgiven for over-reacting.

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Article: Wall Street’s Big Win

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Wall Street’s Big Win

Matt Taibbi

Rolling Stone, 4 August 2010

Cue the credits: the era of financial thuggery is officially over. Three hellish years of panic, all done and gone – the mass bankruptcies, midnight bailouts, shotgun mergers of dying megabanks, high-stakes SEC investigations, all capped by a legislative orgy in which industry lobbyists hurled more than $600 million at Congress. It all supposedly came to an end one Wednesday morning a few weeks back, when President Obama, flanked by hundreds of party flacks and congressional bigwigs, stepped up to the lectern at an extravagant ceremony to sign into law his sweeping new bill to clean up Wall Street.

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Article: Wall Street’s Bailout Hustle

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Wall Street’s Bailout Hustle

Matt Taibbi

Rolling Stone, 17 February 2010

On January 21st, Lloyd Blankfein left a peculiar voicemail message on the work phones of his employees at Goldman Sachs. Fast becoming America’s pre-eminent Marvel Comics supervillain, the CEO used the call to deploy his secret weapon: a pair of giant, nuclear-powered testicles. In his message, Blankfein addressed his plan to pay out gigantic year-end bonuses amid widespread controversy over Goldman’s role in precipitating the global financial crisis.

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Testimony: Mary Schapiro’s Testimony Concerning the State of the Financial Crisis

Testimony

Testimony Concerning the State of the Financial Crisis

Mary L. Schapiro

SEC, 14 January 2010

I believe the work of the Financial Crisis Inquiry Commission (FCIC) is essential to helping policymakers and the public better understand the causes of the recent financial crisis and build a better regulatory structure. Indeed, just over seventy-five years ago, a similar Congressional committee was tasked with investigating the causes of the stock market crash of 1929. The hearings of that committee led by Ferdinand Pecora uncovered widespread fraud and abuse on Wall Street, including self-dealing and market manipulation among investment banks and their securities affiliates. The public airing of this abuse galvanized support for legislation that created the Securities and Exchange Commission in July 1934. Based on lessons learned from the Pecora investigation, Congress passed laws premised on the need to protect investors by requiring disclosure of material information and outlawing deceptive practices in the sale of securities.

PDF (29 pages): Testimony Concerning the State of the Financial Crisis

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Article: Judge Rejects Settlement Over Merrill Bonuses

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Judge Rejects Settlement Over Merrill Bonuses

Zachary Kouwe

New York Times, 14 September 2009

As President Obama traveled to Wall Street on Monday and chided bankers for their recklessness, across town a federal judge issued a far sharper rebuke, not just for some of the financiers but for their regulators in Washington as well.

Giving voice to the anger and frustration of many ordinary Americans, Judge Jed S. Rakoff issued a scathing ruling on one of the watershed moments of the financial crisis: the star-crossed takeover of Merrill Lynch by the now-struggling Bank of America.

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