Daily Archives: March 28, 2014

UNC academic scandal: Whistleblower, former athlete speak out on athletes that were guided towards fake classes and gifted grades to comply with NCAA guidelines

UNC scandal

North Carolina whistleblower Mary Willingham and former football player Deunta Williams discuss the fake classes that student-athletes were allegedly encouraged to take in order to maintain eligibility to play.

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Also read more on Daily Mail. Click here.

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60 Minutes: Stock market rigged, says Michael Lewis in new book

60 Minutes: Stock market rigged, says Michael Lewis in new book

The U.S. stock market is rigged in favor of high-frequency traders, stock exchanges and large Wall Street banks who have found a way to use computer-based speed trading to gain a decisive edge over everyone else, from the smallest retail investors to the biggest hedge funds, says Michael Lewis in a new blockbuster book, “Flash Boys.” 

The insiders’ methods are legal but cost the rest of the market’s players tens of billions of dollars a year, according to Lewis, who speaks to Steve Kroft in his first interview about the book. Kroft’s report will be broadcast on 60 Minutes, Sunday, March 30 at 7 p.m. ET/PT.

 

High-frequency traders have found ways to use their speed to gain an advantage that few understand, says Lewis. “They’re able to identify your desire to buy shares in Microsoft and buy them in front of you and sell them back to you at a higher price,” says Lewis. “The speed advantage that the faster traders have is milliseconds…fractions of milliseconds.”

Lewis says a former trader at the Royal Bank of Canada in New York, Brad Katsuyama, figured this out after he consistently failed to have his entire order filled at the price he wanted. Katsuyama, who speaks to Kroft, put together a team of experts to figure out how to defeat the problem and started a new exchange, IEX, that he believes will level the playing field. Katsuyama launched IEX in October and investors, large and small, can route their trades through IEX without fear of predators lurking. IEX has accomplished this by creating a unique speed bump. “They slowed down high-frequency traders’ ability to trade on their market,” says Lewis.

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NY AG will continue to pursue its claims of fraud against BofA former CFO Joe L. Price

NY AG will continue to pursue its claims of fraud against BofA former CFO Joe L. Price

BofA CFO is the next on NY AG’s list…

NEW YORK — Attorney General Eric T. Schneiderman today announced a $25 million settlement with Bank of America Corporation and its former Chairman and Chief Executive Officer, Kenneth D. Lewis, regarding the bank’s actions as it sought to merge with Merrill Lynch & Co in 2008. Despite its top executives’ specific knowledge of mounting losses at Merrill Lynch that were forecast at more than $9 billion, Bank of America failed to disclose that information to shareholders prior to their vote on a proposed merger with Merrill Lynch. The Attorney General also alleged that the Bank’s former CEO and CFO, Kenneth Lewis and Joe Price, misrepresented to shareholders the impact that the merger with Merrill would have on Bank of America’s future earnings. The barring of Mr. Lewis from serving as an officer or director of a public company for three years, as well as the payment of $10 million to the State of New York, represents one of the first successful attempts by law enforcement to hold accountable a CEO or individual at a major institution since the financial crisis.

“Since I took office, I’ve acted on the belief that no one, no matter how rich or powerful, should escape accountability for their actions — especially ones that caused such damage to shareholders,” said Attorney General Schneiderman. “Today’s settlement demonstrates a major victory in our continued commitment to applying the law equally to individuals, as well as corporations. I would hope this closes one chapter of our ongoing efforts to ensure the frauds that occurred in and around the financial crisis are not forgotten.”

On April 4, the Attorney General intends to file a summary judgment motion against the remaining defendant in the case, Joe L. Price, the bank’s former Chief Financial Officer. 

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Executive Who Committed Suicide Anxious Amid Deutsche Bank Probes

Executive Who Committed Suicide Anxious Amid Deutsche Bank Probes

LONDON—A former senior executive at Deutsche Bank AG DBK.XE +1.30% committed suicide earlier this year after complaining that he was anxious about government investigations into the bank, a London coroner said Tuesday.

The executive, William Broeksmit, was found hanging in his London home in January. The 58-year-old Chicago native left a senior role at Deutsche Bank’s investment bank in February 2013, but he remained an adviser until the end of last year. The London coroner, in an inquest on Tuesday, didn’t give more details on what caused Mr. Broeksmit’s anxiety.

People familiar with the matter say he had been involved in investigations by U.S. authorities probing the bank. In the months before his death, he told friends that he felt abandoned by former colleagues whom he had spent years supporting, according to people he spoke with.

The London coroner’s office, which investigates sudden or violent deaths including suicides, said Mr. Broeksmit left multiple suicide notes but didn’t disclose their contents.

One of those notes was to Anshu Jain, Deutsche Bank’s co-chief executive, according to a person familiar with the note. The decadeslong investment-banking careers of Messrs. Broeksmit and Jain were closely entwined, dating back to their work together in the 1990s building Merrill Lynch & Co.’s derivatives business.

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Rocket docket: In an hour, judge clears 300 foreclosure cases

Rocket docket: In an hour, judge clears 300 foreclosure cases

SARASOTA COUNTY – The morning roll call was long: GMAC Mortgage vs. Thomas Brady. SunTrust Mortgage vs. Scott Dodat. Wells Fargo vs. Janet Winn.

On it went.

One-by-one, foreclosure cases were called out by a retired judge — many dating back to the trough of the crisis in 2008 — and dismissed by the court in just seconds.

The local judicial system, still burdened with a backlog of more than 10,000 foreclosures, cleared a 60-page docket with nearly 300 languishing cases Friday in about an hour.

The hearing was set to remove stagnant defaults that had fallen through the cracks and that had not been touched in the past 10 months — housekeeping that is still done a few times each year.

A couple dozen attorneys scurried into the cramped downtown justice center promptly at 9 a.m., trying to save their case from the purge.

For most, it was too late.

Tearful homeowners also arrived, holding court orders and stacks of mortgage bills, not knowing what to expect. Before they could even get a word out, their cases were tossed.

 

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SFO charges ICAP Libor trio

SFO charges ICAP Libor trio

Ex-ICAP employees alleged to have conspired to manipulate benchmark borrowing rate.

Three former employees of London-listed interdealer ICAP have been charged by the Serious Fraud Office over the alleged rigging of benchmark borrowing rates.

Danny Wilkinson, Darrell Read, and Colin Goodman are alleged to have conspired to manipulate yen Libor between August 2006 and September 2010, according to a statement from the SFO.

All three men have already been named by the US Department of Justice in connection with rate manipulation and are each facing one count of conspiracy to commit wire fraud and two counts of wire fraud.

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Force-placing insurance lawsuit against US Bank

Force-placing insurance lawsuit against US Bank

A federal judge refused to dismiss claims over U.S. Bank’s practices with regard to force-placing flood insurance, underwritten by American Security Insurance Co.