Pension adviser says Ernst & Young was aware of Wal-Mart Mexico bribery allegations

(Reuters) – A labor-affiliated pension fund adviser is seeking an inquest into the auditor of Wal Mart Stores Inc, Ernst & Young LLP, accusing the auditing firm of knowing about possible bribery in Mexico long before the retailer disclosed it to U.S. authorities.

CtW Investment Group, an adviser to union pension funds holding about 0.15 percent of Wal-Mart’s shares, said an internal Wal-Mart memo released during shareholder litigation showed that Ernst & Young was informed by Wal-Mart’s internal audit services, or IAS, unit that a whistleblower had provided evidence of the alleged Mexico bribery scheme to Wal-Mart.

“E&Y was briefed by IAS over the course of the Company’s internal investigation from late 2005 through early 2006,” according to a letter sent last week by CtW to the Public Company Accounting Oversight Board, or PCAOB. The board, CtW wrote, should consider “whether E&Y responded appropriately after obtaining evidence of illegal acts and serious internal control deficiencies.”

CtW Executive Director Dieter Waizenegger said the group only realized the significance of the memo in recent months.

Read on.

Wells Fargo CEO John Stumpf Tells University Of Minnesota Grads To ‘Fall In Love With Mistakes’

Fall in love with your mistakes?? lol Now that is a joke. Wells Fargo falls in love with their mistakes as long as they pay a fine and no jail time for their crimes to the government and the taxpayers bail them out.

Well Fargo CEO John Stumpf told graduates of the Carlson School of Management at the University of Minnesota that in order to transition from knowledge to wisdom, they’ll need to make some mistakes.

“I wish I’d been much more aggressive in sharing my mistakes and learning from other people’s mistakes along the way — you’re not going to [get] old enough to make all the mistakes yourself, learn from other’s mistakes,” Stumpf said.

Stumpf earned his bachelor’s degree from St. Cloud State University, St. Cloud, Minnesota and got his MBA from the University of Minnesota. He spoke at the Carlson School’s commencement on May 18.

Stumpf said he had “three quick things with all of you that I wish someone had shared with me when I was in your seat”: The “changing world I was going to go enter,” “the journey of learning,” and a couple of hints on how to develop and build a career. On the last note, he encouraged grads to work for a company that “shares your values, your beliefs, your ethics.”

People who are happiest “fall in love with learning,” Stumpf said, while adding that people should also “fall in love with mistakes.”

Read on.

An important message from a blogger of an ongoing battle with Bank of America


Passing this along from someone that email me to get the word out. See below:

2015/05/26 at 2:59 am

Dear Justice League,

I’m writing in an attempt to raise awareness of the countless thousands of families nationwide, many of them Military Veterans like myself, who are having their lives destroyed and their homes literally stolen by “Big Banks” through illegal foreclosures and fraudulent mortgage servicing practices that continue to this day.

These banks, on the rare occasions when they are called out for their illegal acts, are slapped on the wrist with small fines which do nothing to make whole the people who have lost their homes, their financial viability, and in many cases their health as a result.

Frankly I’m at a loss for why there isn’t more publicity surrounding this. The media is effectively complicit with their silence.

In addition to our attempt to raise the overall awareness of this national criminal tragedy, we’re trying to publicize our own ongoing Battle with Bank of America.

We’re seeking help in order to raise the money we need to have any chance of winning our case which is currently in the New Hampshire Supreme Court.

We thought perhaps you could help us get the word out.

Great thanks in advance, and please share this story with as many people as you possibly can.

Please contact me via my GoFundMe site with any questions or further information.

The Grey Family

Banks Will Keep Doing FX Stuff That Got Them in Trouble

The definition of insanity….

I mentioned yesterday that, as a condition of their probation, all the banks that pled guilty to a conspiracy to rig foreign-exchange rates have to send sad little “Disclosure Notices” to their clients. Here, for instance, is JPMorgan’s disclosure notice, which on a cursory glance seems to be identical to the one attached to its plea agreement. It’s an interesting little document. There’s an introductory paragraph, and then a paragraph of contrite moaning that “conduct by certain individuals has fallen short of the Firm’s expectations,” specifically by being a massive antitrust conspiracy.

Then there are three bullet points describing other naughtiness that does not rise to the level of antitrust conspiracy. Those bullet points begin:

“We added markup to price quotes using hand signals and/or other internal arrangements or communications.”

“We have, without informing clients, worked limit orders at levels (i.e., prices) better than the limit order price so that we would earn a spread or markup in connection with our execution of such orders.”

“We made decisions not to fill clients’ limit orders at all, or to fill them only in part, in order to profit from a spread or markup in connection with our execution of such orders.”

You might read these sentences as admissions of guilt, or disclosures of crimes, or even apologies. In context — in the context of a disclosure notice sent to clients as part of the bank’s probation for a felony conviction, one paragraph after the apology for the massive antitrust conspiracy — that’s kind of what they look like. And in the banks’ plea agreements, the practices described in those bullet points are listed as “other relevant conduct” for the criminal conspiracy. So Iread the bullet points as confessions yesterday, and was puzzled because, while they seem like sharp practices, they don’t quite seem like crimes.

But those bullet points are actually introduced by the phrase, “The Firm has engaged in other practices on occasion, including:.” These are not crimes, just “practices.” And the disclosure notice just describes them. It stops after the bullet points. It never says “and those practices were wrong.” Or “and we’re sorry we did those things.” Or even: “and we’ll stop doing them.”

Because they won’t! Here’s another letter that JPMorgan is sending to its clients along with the disclosure notice. This one is not a condition of its probation. Here’s how it starts:

The purpose of this letter is to clarify the nature of the trading relationship between you and the Corporate & Investment Bank at JPMorgan Chase & Co. and its affiliates (together, “JPMorgan” or the “Firm”) and to disclose relevant practices of JPMorgan when acting as a dealer, on a principal basis, in the wholesale spot foreign exchange (“FX”) markets.  We want to ensure that there are no ambiguities or misunderstandings regarding those practices.

So: That does not sound like an apology. That sounds downright feisty. The disclosure notice, which JPMorgan has to send, starts with an apology and then goes on to list some things that JPMorgan did in the past. The client letter, which JPMorgan wants to send, starts with a defiant “no ambiguities or misunderstandings” and then goes on to list some things that JPMorgan will keep doing in the future.

Did you guess that they’re the same things? Of course you did! (Minus the antitrust conspiracy of course.)

So the Justice Department didn’t like that JPMorgan, and most of the FX-manipulating banks, “added markup to price quotes using hand signals and/or other internal arrangements or communications.” So JPMorgan has to say to clients:

In certain instances, certain of our salespeople used hand signals to indicate to the trader to add markup to the price being quoted to the client on the open telephone line, so as to avoid informing the client listening on the phone of the markup and/or the amount of the markup.

Read on.

Greece will not make June IMF repayment: interior minister

Greece has again threatened to default on loan repayments due to the International Monetary Fund, saying it will be unable to meet pension and wage bills in June and also reimburse €1.6bn owed to the Fund without a bailout deal with creditors.

“The money won’t be given . . . It isn’t there to be given,” Nikos Voutsis, the interior minister, told the Greek television station Mega.

He claimed the EU and IMF were pressuring Greece to make unacceptable concessions in the current bailout talks in return for unlocking €7.2bn of aid frozen since last year.

Read on.

Elizabeth Warren’s ally on the inside: SEC Kara Stein

After years of criticizing regulators for lax enforcement of securities law, Elizabeth Warren finally has an outspoken ally on the inside pushing for a crackdown on Wall Street offenders.

Kara Stein, the junior Democrat on the Securities and Exchange Commission, has quickly become one of its more ruthless enforcers, making trouble for Wall Street, and aligning herself with Warren’s views as part of a powerful regulator that polices the financial industry.

Stein has opposed giving free passes, or waivers, to badly behaving financial companies so that they can keep doing certain types of business as if nothing happened. Before she started dissenting, the waiver approval was often a routine formality at the SEC.


Though she may not have the Massachusetts senator’s star power or political ambition, Stein has rattled financial companies, several banking lobbyists said.

“If you have a motion for a waiver pending before the SEC, Stein is your immediate concern,” said Bradley Miller, a former House Democrat who worked on the 2010 Dodd-Frank Act and is now with Grais & Ellsworth LLP.

Even Warren (D-Mass.) told POLITICO she’s impressed with Stein’s aggressive work.

“Kara Stein has worked on securities law and reform issues for years and she really knows her stuff. I’m very pleased that her strong, independent voice is now at the SEC,” Warren said in a statement. A staffer for Stein declined to comment.

Described as a “nerd” by some who know her, Stein may not have the same pulpit that Warren commands from the Senate. But as one of the five SEC commissioners, Stein has a more direct say over Wall Street companies’ businesses.

Stein, 51, and a mother of two, drafted parts of the Dodd-Frank while working for Sen. Jack Reed (D-R.I.) on the Senate Banking Committee. She was appointed to the SEC by President Barack Obama in 2013, the same year Warren joined the Senate.

Earlier this year, she voted against the SEC’s approval of a new kind of complicated financial product, an exchange-traded fund, which she said could be too risky.

And in a recent speech, Stein questioned companies’ love affair with buy backs of shares — warning that the move might be sacrificing long-term growth for short-term gains.

As much as Warren irks big big banks, Stein’s tough stance against waivers that could give them more trouble in the near-term.

“Stein and Warren, in continuing to criticize the waivers over time, have created a debate about waivers. [SEC Chair] Mary Jo White has had to defend those publicly in a way the typically the SEC does not do,” Miller said.

Just this month, Stein blasted an SEC waiver approved for Deutsche Bank, which had agreed to pay $2.5 billion in penalties to settle criminal allegations from the government that it manipulated borrowing rates.

In public remarks two days later, she defended her work opposing waivers for companies that get into trouble.

“It should not be seen as an automatic waiver,” Stein said, speaking May 6 at a conference in Washington. “Maybe we should have time-out waivers, conditional waivers. It’s thinking outside the box again with the existing tool the commission has, which actually might have more deterrent value at the end of the day than a large penalty,” said Stein, the morning after Warren delivered a fiery speech at the same conference. “A large penalty sometimes for a large firm is sort of a speed bump,” Stein said.

Indeed, Stein has voted against waivers at least four times when they’ve come before the SEC, putting her at odds with White.

Read more:

Elizabeth Warren is calling for public hearings on banks

Go Elizabeth!!!

NEW YORK (Reuters) – US Senator Elizabeth Warren is calling for U.S. Department of Labor hearings on whether banks accused of rigging foreign exchange markets should be allowed to manage retirement accounts, the Financial Times reported on Sunday.

“When banks plead guilty to a crime, federal agencies must do more than look the other way,” Warren told the Financial Times. “The SEC has already granted waivers to each of these banks without any detailed explanation, but it is not too late for the Department of Labor to hold a public hearing before it decides that such brazen lawbreakers can be trusted managing workers’ retirement accounts.”

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