Barclays : U.S. panel says Barclays, Deutsche Bank helped funds avoid taxes

The head of a powerful U.S. Senate panel has accused Deutsche Bank AG (>> Deutsche Bank AG) and Barclays Plc (>> Barclays PLC) of helping hedge funds avoid taxes, calling for tougher action from the authorities.

The head of a powerful U.S. Senate panel has accused Deutsche Bank AG (>> Deutsche Bank AG) and Barclays Plc (>> Barclays PLC) of helping hedge funds avoid taxes, calling for tougher action from the authorities.

The banks sold complex option products to Renaissance Technology Corp [RENST.UL] that saved it and other hedge funds billions of dollars in taxes, Democratic Senator Carl Levin, who heads the U.S. Senate Permanent Subcommittee on Investigations, said on Monday.

“Ordinary Americans had to shoulder a tax burden of billions of dollars, a burden that was shrugged off by these hedge funds,” Levin told a news conference.

“And those same Americans will pay the price as the excess risk from massive over leveraging once again destabilises our economy as it has in the past.”

Levin’s committee presented the findings of a year-long probe into so-called basket options, which Levin said can be misused to lower taxes, and plans to grill representatives from the banks and Renaissance in a public hearing on Tuesday.

Read on.

Mr. Frank goes back to Washington

Former Congressman Barney Frank is returning to Washington this week to testify before the House Financial Services Committee at a hearing marking the fourth anniversary of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010.

In a hearing entitled “Assessing the Impact of the Dodd-Frank Act Four Years Later,” Frank will return to Capitol Hill to testify on the financial reforms brought on by the act that bears his name.

“I’m pleased Barney has agreed to return to the Committee on the four-year anniversary of Dodd-Frank, to discuss significant progress we have made in protecting consumers, reining in Wall Street and preventing another financial crisis,’ Congresswoman Maxine Waters (D-CA) said. “I look forward to joining him to refute Republican misrepresentations about the origins of the crisis and the impact of Dodd-Frank.”

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Judge shoots down FHFA bid to limit discovery, keep docs secret

Judge Margaret Sweeney handed Fairholme Funds a huge victory late last week when she ruled in favor of broad access in discovery to FHFA records going back years, rather than the narrow period in 2012 that the FHFA wanted to limit discovery to.

Sweeney also slapped down the argument from the FHFA that the court lacked authority, reminding the agency that it is not above the law. Fairholme Funds serves as the point of entry for Investors Unite and other GSE shareholders suing the FHFA.

“With respect to defendant’s claim that the court lacks the authority to affect the exercise of the FHFA’s powers or functions, the court agrees with the case law of the United States Court of Appeals for the Ninth Circuit, which states that the FHFA cannot evade judicial review,” Sweeney wrote in her opinion.

Read on.

Pursuing antitrust claims for LIBOR manipulation in England

Many readers will know that the US Supreme Court has agreed to hear an appeal by Plaintiffs whose antitrust claims over LIBOR manipulation were dismissed last year by New York Southern District Judge Naomi Buchwald.

Even if the appeal fails, as we reported at the time, the Buchwald decision would not be mirrored in England because of differences between European and US antitrust laws.

This was confirmed last December when the European Commission fined a group of banks €1.71 billion for infringement of antitrust laws in their manipulation of LIBOR and another interest rate benchmark, EURIBOR.

In England (although not elsewhere in Europe) such decisions by antitrust regulators are binding on the Courts, so “follow-on” damages actions can bypass the liability phase of trial, jumping straight to questions of causation and quantification of damage.

Read on.

Wayne County Huntington couple files suit to stop foreclosure

WAYNE — A bank faces a lawsuit as a couple tries to prevent foreclosure on their home.

Jack C. Hardin and Joan M. Hardin filed suit June 19 in Raleigh Circuit Court against Branch Banking and Trust Co.

According to the complaint, the plaintiffs purchased a home in 1998 for $161,000 with a deed of trust assigned to the defendant. In 2013 the plaintiffs were struggling to pay their mortgage and filed for a forbearance and loan modification in May 2013 on the assumption the defendant would provide assistance on the mortgage.

However, the defendant sent a foreclosure notice in September 2013, that was returned unread, according to the suit.

A foreclosure sale was conducted Oct. 3 where the defendant purchased the home for $133,900.98 without the plaintiffs’ knowledge, the suit states.

The Hardins are seeking for the Oct. 3 sale to be voided, costs and further relief the court deems appropriate.

Read on.

Goldman Sachs Managing Director Found Dead In Apparent Kite Surfing Accident

As Bloomberg reports,

Nicholas Valtz, a managing director in cross-asset sales at Goldman Sachs in New York, wasfound in Napeague Harbor off the coast of Long Island, according to the East Hampton police. Valtz, 39, was a “novice kiteboarder” and was found floating in the water secured to his kite, police said in a statement released yesterday. Other kite gear was found in a grassy area of the harbor, police said.

Valtz, who joined Goldman Sachs in 2000, was promoted to managing director in 2010. His wife, Sashi Valtz, also works at Goldman Sachs as head of global third-party research sales, according to her LinkedIn profile.

Police are still investigating the death, according to the statement.

…

In March 2008, Valtz shaved his head to raise money for childhood cancer research, according to the website for St. Baldrick’s Foundation. Valtz enjoyed technology products and fast cars, according to the website for his brother-in-law’s 2012 wedding in which he was a groomsman.

This is the 15th financial services exective death in recent months…

1 – William Broeksmit, 58-year-old former senior executive at Deutsche Bank AG, was found dead in his home after an apparent suicide in South Kensington in central London, on January 26th.

2 – Karl Slym, 51 year old Tata Motors managing director Karl Slym, was found dead on the fourth floor of the Shangri-La hotel in Bangkok on January 27th.

3 – Gabriel Magee, a 39-year-old JP Morgan employee, died after falling from the roof of the JP Morgan European headquarters in London on January 27th.

4 – Mike Dueker, 50-year-old chief economist of a US investment bank was found dead close to the Tacoma Narrows Bridge in Washington State.

5 – Richard Talley, the 57 year old founder of American Title Services in Centennial, Colorado, was found dead earlier this month after apparently shooting himself with a nail gun.

6 – Tim Dickenson, a U.K.-based communications director at Swiss Re AG, also died last month, however the circumstances surrounding his death are still unknown.

7 – Ryan Henry Crane, a 37 year old executive at JP Morgan died in an alleged suicide just a few weeks ago.  No details have been released about his death aside from this small obituary announcement at the Stamford Daily Voice.

8 – Li Junjie, 33-year-old banker in Hong Kong jumped from the JP Morgan HQ in Hong Kong this week.

9 – James Stuart Jr, Former National Bank of Commerce CEO, found dead in Scottsdale, Ariz., the morning of Feb. 19. A family spokesman did not say whatcaused the death

10 – Edmund (Eddie) Reilly, 47, a trader at Midtown’s Vertical Group, commited suicide by jumping in front of LIRR train

11 – Kenneth Bellando, 28, a trader at Levy Capital, formerly investment banking analyst at JPMorgan, jumped to his death from his 6th floor East Side apartment.

12 – Jan Peter Schmittmann, 57, the former CEO of Dutch bank ABN Amro found dead at home near Amsterdam with wife and daughter.

13 – Li Jianhua, 49, the director of China’s Banking Regulatory Commission died of a sudden heart attack

14 – Lydia _____, 52 – jumped to her suicide from the 14th floor of Bred-Banque Populaire in Paris

15 – Julian Knott, 45 – killed wife and self with a shotgun in Jefferson Township, New Jersey

16 – Nicholas Valtz, 39 – killed in apparent kiteboarding accident in Nepaugue Harbor, Long Island.

Foreclosed on, Irregularly, After 74 Years

MINNEAPOLIS (CN) – An elderly, disabled woman lost to an illegal foreclosure the home she has lived in for 74 years, after Reverse Mortgage Solutions and Fannie Mae “accelerated” her loan balance, she claims in court.
Patricia A. Witte sued Reverse Mortgage Solutions, a Delaware corporation based in Texas, and the Federal National Mortgage Association, on July 15 in Hennepin County Court.
In the lawsuit, Witte says her parents bought the home in 1939, and she has lived there her entire life. As a child she contracted Guillain-Barre Syndrome and has been disabled for most of her life, making it impossible to work due to the disability. Her parents used the home to care for her, and lived there until their own deaths.
When Witte inherited the home it was free from any mortgages or other liens, but it the home needed repairs, according to the complaint.
“Ms. Witte received only Social Security income at the time – between $400 and $500 per month. She could not qualify for any other kind of loan besides a reverse mortgage loan,” according to the complaint.

Read on.

8th Circ. Set To Consider Dodd-Frank Whistleblower Scope

Case Title

Bussing v. Legent Clearing, LLC et al

 

Case Number

8:12-cv-00238

Court

Nebraska

Nature of Suit

Civil Rights: Jobs

Judge

John M. Gerrard

Date Filed

July 9, 2012

Law360, New York (July 21, 2014, 3:25 PM ET) — A Nebraska federal judge on Thursday granted COR Clearing LLC’s bid to ask the Eighth Circuit to weigh in on whether a former executive qualified as a whistleblower under the Dodd-Frank Act despite having never provided information to the U.S. Securities and Exchange Commission.

District Judge John M. Gerrard granted the company’s motion to certify that question for an interlocutory appeal, finding the question of whether plaintiff Julie A. Bussing is protected under the whistleblowing statute is a controlling aspect of the case. An Eighth Circuit…

Source: Law 360

4th anniversary of Dodd-Frank bill

Dimon threatens to quit FHA loans: Rules on penalties need to be clearer, CEO says

JPMorgan Chase’s (JPM) CEO says his bank is considering getting out of the FHA mortgage origination business altogether.

Notably, with the second quarter’s 66% year-over-year plunge in originations reported last week, that process is inadvertently and unintentionally under way.

CEO Jamie Dimon’s JPMorgan paid more than $600 million in federal fines for originating $200 million in flawed FHA loans, and now he and others in the industry want clearer rules spelling out when the government will demand these triple penalties, Bloomberg reports.

“The real question to me is, should we be in the FHA business at all?” Dimon said. “And we’re still struggling with that.”