That didn’t take long: Goldman Real-Estate Play Skirts Volcker Ban
- Holes and trucks come to mind as Goldman Sachs (GS +0.8%) – pitching a new real-estate related fund – tells potential investors it will own up to 20% of it. This despite a Volcker Rule prohibition on banks owning more than 3% of a hedge fund or private-equity portfolio.
Citigroup, Standard Chartered’s Korean Units Told to Probe Leaks
South Korea’s financial regulator ordered Citigroup Inc. and Standard Chartered Plc’s units to investigate allegations that staff members or contract workers sold client information to private lending agents.
The Financial Supervisory Service is waiting to hear from Citibank Korea Inc. and Standard Chartered Bank Korea Ltd. about the internal probes before deciding whether to conduct its own investigation, Lee Sang Koo, the director-general of the FSS’s bank supervision team, said by phone today.
The FSS may begin inspecting the two banks regarding the allegations, the Seoul Economic Daily reported today, without citing anyone. The South Korean prosecutors’ office said in a Dec. 11 statement it arrested an employee of “Bank C” for leaking information on 34,000 clients including details of lending contracts.
Swiss Banks Employ Army of Advisers for U.S. Amnesty Plan
Switzerland’s 300 banks have enlisted an army of auditors, lawyers and in-house workers as they race to meet a Dec. 31 deadline on whether to seek U.S. amnesty for helping American clients evade taxes.
Ex-Wells Fargo employee: ‘We were constantly told we’d be working for McDonald’s’: Report
Wells Fargo branch manager Rita Murillo came to dread the phone calls.
Regional bosses required hourly conferences on her Florida branch’s progress toward daily quotas for opening accounts and selling customers extras such as overdraft protection. Employees who lagged behind had to stay late and work weekends to meet goals, Murillo said.
Then came the threats: Anyone falling short after two months would be fired.
“We were constantly told we would end up working for McDonald’s,” said Murillo, who later resigned. “If we did not make the sales quotas … we had to stay for what felt like after-school detention, or report to a call session on Saturdays.”
Wells Fargo & Co. is the nation’s leader in selling add-on services to its customers. The giant San Francisco bank brags in earnings reports of its prowess in “cross-selling” financial products such as checking and savings accounts, credit cards, mortgages and wealth management. In addition to generating fees and profits, those services keep customers tied to the bank and less likely to jump to competitors.
But that success has come at a cost. The relentless pressure to sell has battered employee morale and led to ethical breaches, customer complaints and labor lawsuits, a Times investigation has found.
Bank of America finds itself in harsh spotlight over ‘lost paperwork’ allegations
Bank of America and its subcontractors placed obstacles in the way of troubled borrowers seeking loan modifications, including losing their paperwork, according to Bloomberg News, citing nine former employees of a BofA vendor.
The bank and its subcontractor, Urban Lending Solutions of Broomfield, Colo., denied the allegations.
Banks pay for past sins as U.S., Europe levy record fines
U.S. and European regulators fined banks record amounts this year, imposing penalties and settlements of more than $43 billion (26.3 billion pounds) as authorities work more closely across borders to clean up the financial sector.
Banks in the United States and Europe are paying for misconduct that includes mis-selling U.S. mortgage bonds, rigging interest rates, and risky transactions such as JPMorgan’s “London Whale” trades.
Regulators across the globe are making banks dig far deeper than in the past for their misdeeds, led by U.S. authorities who have long been more aggressive and imposed penalties more than 10 times those meted out in Europe.
Fed Proposes Limits on Emergency Lending Under Dodd-Frank
The Federal Reserve is proposing changes required by the Dodd-Frank Act of 2010 to regulations governing its ability to extend emergency lending to struggling financial firms.
“The proposed rule is designed to ensure that any emergency lending program or facility is for the purpose of providing liquidity to the financial system, and not to aid an individual failing financial company,” the Fed said today in a statement issued in Washington.
The Fed will take comments until March 7 on its proposal, which meets a requirement of Dodd-Frank, the regulatory overhaul enacted after a financial crisis that saw the central bank extend billions of dollars in assistance to banks. In an effort to reduce chances that taxpayer money could be used to rescue failing companies, the law narrowed the Fed’s ability to extend a liquidity lifeline — as was done with Bear Stearns Cos. and American International Group Inc. in 2008.