Daily Archives: August 4, 2015

U.K. Serious Fraud Office Plans More Libor Charges in the Fall

LONDON—British fraud prosecutors, fresh from their conviction of former bank trader Tom Hayes , are planning to bring criminal charges against additional individuals in the coming months.

David Green, the director of the U.K.’s Serious Fraud Office, said Tuesday in an interview with The Wall Street Journal that he plans in the fall to file criminal charges against other former bankers for allegedly manipulating the London interbank offered rate, or Libor. He declined to comment on their identities or seniority or the exact timing.

Those charges would come in addition to the 11 men who are already awaiting London trials for their alleged roles in the rate-rigging scandal and a 12th banker who worked at a British bank and has pleaded guilty. Six former brokers who allegedly conspired with Mr. Hayes are set to stand trial in London from September; they have pleaded not guilty.

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BofA Governance Worst Since Pre-Crisis Citigroup, Mayo Says

Bank of America Corp., which overruled a shareholder vote mandating an independent chairman, has the worst corporate governance of any big bank since Citigroup Inc. before the financial crisis, CLSA Ltd. analyst Mike Mayo said.

Bank of America shareholders as of Aug. 10 will be allowed to vote on last year’s change that enabled Chief Executive Officer Brian Moynihan to add the chairman title, the Charlotte, North Carolina-based lender said last week in a regulatory filing.

“How they fix that corporate governance issue is up to them,” Mayo said Tuesday in an interview. “Fire the corporate governance committee, make changes at the top, have an independent chairman. We don’t care, but this needs to be fixed.”

Larry DiRita, a spokesman for the bank, declined to comment on Mayo’s remarks.

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Wells Fargo Risks Lawsuits to Protect Its Elderly Clients

Not waiting for regulators — including state-government agencies — to expand protection of senior customers, Wells Fargo has decided to allow its brokers to interfere, even if the action could lead to lawsuits, Financial Advisor magazine writes.

Regulators certainly seem to be looking into ways to curb elder abuse. Finra launched a senior help line in April and — according to Gerri Walsh, head of Finra’s Investor Education Foundation — has already received 1,000 calls from brokerage clients as well as executors and beneficiaries of estates, reports the magazine.

But Wells Fargo is preparing to tackle the issue. Appearing at a Practising Law Institute seminar last week, Wells Fargo managing counsel Beverly Jo Slaughter said the firm’s brokers will be able to stop transactions if they suspect fraud — regardless of whether they have legal authority — even at the risk of getting sued, Financial Advisor reports.

While Wells Fargo’s Elder Services Program is working with state regulators to grant brokers the right to stop transactions, some states apply the right only to abuse at nursing homes and not to financial exploitation, the magazine quotes Slaughter as saying.

One form of such exploitation, according to the magazine, stems from recently arrived young “foreign friends” — often grifters intent on wringing money from their victims — Joseph Peiffer, president of the Public Investors Arbitration Bar Association, tells Financial Advisor.

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Dimon: Create a good team and dump the jerks

Jamie needs to take his own advice and reverse those words: Dump all the bankster CEOs and the entire board and create a good team of CEO and board. And the first sentence of the article is absolutely correct: Dimon is no entrepreneur.

DENVER BUSINESS JOURNAL – Jamie Dimon says he is no entrepreneur.

But the JPMorgan Chase & Co. chairman and CEO knows business and how to succeed. Entrepreneurs, he said today, need a good team, need to dump the jerks, and sometimes need to fail.

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US Prosecution of White Collar Crime Hits 20-Year Low: Report

Federal prosecution of white-collar crime has hit a 20-year low, according to a new report on Department of Justice data. The analysis of thousands of records by Syracuse University shows a more than 36 percent decline in such prosecutions since the middle of the Clinton administration, when the decline first began.

In the aftermath of the 2008 financial crisis, prosecutions ticked up slightly, but then dropped. Landing amid calls from Democratic presidential candidates for more Wall Street prosecutions, the report notes that the projected number of prosecutions this year is 12 percent less than last year and 29 percent less than five years ago.

“The decline in federal white-collar crime prosecutions does not necessarily indicate there has been a decline in white-collar crime,” Syracuse researchers note. “Rather, it may reflect shifting enforcement policies by each of the administrations and the various agencies.”

Underscoring that assertion is a recent study by researchers at George Mason University tracking the increased use of special Justice Department agreements that allow corporations — and often their executives — to avoid being prosecuted. Before 2003, researchers found, the Justice Department offered “almost no” such deals. The researchers report that from 2007 to 2011, 44 percent of cases were resolved through the deals — known as deferred prosecution agreements and non-prosecution agreements.

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Nationstar Mortgage Debtors Denied Cert. In Fee Scheme Suit

Law360, New York (August 3, 2015, 10:05 PM ET) — A Florida federal judge declined Friday to certify a proposed class action alleging Nationstar Mortgage Holdings Inc. improperly charged its customers various fees, finding that the nine class definitions didn’t show commonality and only individualized evidence could prove wrongdoing.

U.S. District Judge Beth Bloom said she would have to make a determination that Nationstar is liable for improperly levying fees, including property inspection fees, property preservation fees, property appraisal fees, property taxes and attorneys’ fees, before concluding that an individual is a member of the class….

Source: Law360

‘Fugitive’ ex-UBS trader cannot escape U.S. case over Libor: judge

A former UBS AG (>> UBS AG) trader charged as part of a U.S. investigation into Libor rate manipulation lost a bid to have the case dismissed on Monday, with a federal judge ruling that a fugitive from U.S. justice had no right to mount a legal challenge.

U.S. District Judge Paul Crotty in Manhattan said Roger Darin, a Swiss citizen, was “flouting judicial process” by remaining in his home country to avoid arrest while sending lawyers to ask the judge to dismiss the case.

Darin’s lawyers argued he was not a fugitive since he had never fled, let alone appeared, in the United States since the U.S. Justice Department filed its criminal complaint in 2012.

But Crotty said his ruling was in line with “the realities of modern criminal prosecutions.”

Bruce Baird, Darin’s lawyer, in a statement said: “We think the judge misunderstood and misapplied the law, and we look forward to an appeal.”

A Justice Department spokesman did not respond to a request for comment.

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