Daily Archives: November 5, 2015

Citigroup Whistleblower Richard Bowen: The Congress Blog posts my op-ed

Every once  in a  while  I ask myself if I’m making any headway in getting the attention of Congress’ Senate Banking Committee and House Financial Affairs Committee. You may recall, this last year when I  appeared on Bloomberg, I asked for a Congressional investigation into the “Too Big to Fail” malfeasance. Even though I keep making noise, as I consider it critical that Congress takes steps to investigate and hold those responsible accountable, nothing concrete had yet happened.
You know my story and my views by now. If we don’t hold the big banks and others who were responsible for our most recent financial meltdown, we’ve essentially given them license to act in the same way again. And I do believe the handwriting is on the wall, which is why I welcomed the opportunity to work with The Other 98% and The Rules, which recently launched a major campaign to encourage Wall Street whistleblowers to come forward when they see wrongdoing within their banks, the subject of one of my recent posts.
And so this week, I believe some progress has been made which has me pretty optimistic; well, ok, somewhat optimistic.

U.S. judge rejects student loan claims in Libor litigation

Nov 4 The U.S. judge overseeing private litigation accusing global banks of manipulating the Libor interest rate benchmark has dismissed class-action claims by borrowers who alleged that their student loans were “unconscionable” because lenders manipulated their rates.

In a 68-page decision on Tuesday night, U.S. District Judge Naomi Reice Buchwald in Manhattan said it was not “substantively unreasonable” to incorporate Libor into the floating-rate portions of the borrowers’ loans, given that even sophisticated borrowers thought it a sufficiently reliable benchmark to use.

Buchwald also said the lawsuits failed to allege that any manipulation by JPMorgan Chase & Co and Bank of America Corp, the two lenders that were sued, increased the plaintiffs’ loan payments.
Read more at Reuters http://www.reuters.com/article/2015/11/04/libor-lawsuits-idUSL1N12Z1HL20151104#s1cteLuRyrQro59h.99

Deutsche Bank E-Mails Showed `Tricks’ That Led to U.S. Pact


The bank used “non-transparent methods” on more than 27,000 dollar-clearing transactions valued at more than $10.8 billion, DFS said.

Many of those methods were spelled out over e-mail — including discussions of not putting everything in writing, DFS’s examples of internal correspondence showed.

One non-U.S. relationship manager who asked for advice about U.S. dollar processing was told that information on “OFAC-safe business patterns” is confidential. “Compliance does not want us to distribute such info to third parties, and forbids us explicitly to do so in any written or electronic form,” the person wrote in an e-mail, according to DFS’s statement. The Office of Foreign Asset Controls enforces U.S. economic and trade sanctions.

Another memo cautioned, “As usual, let’s not revert to the client in writing due to the reputational risk involved if the e-mail goes to wrong places. Someone should call [the client] and tell them orally and ensure that the conversation is not taped.”

Dimon: ‘Banks should be allowed to fail’

Almost no aspect of the financial world went unscathed as JPMorgan ChaseChairman and CEO Jamie Dimon offered his two cents on everything from bank regulation to bitcoin on Wednesday.

Dimon joined a growing chorus of business and political leaders calling on the U.S. government to allow big banks to fail.

“Banks should be allowed to fail,” Dimon told those attending the final day of the Fortune Global Forum at the Fairmont Hotel in San Francisco, which drew 300 CEOs and senior executives. But he clarified: “We’re not going to fail.”

Read on.

Ex-Fed Staffer Cops To Leaking Secrets To Goldman Sachs

Law360, New York (November 4, 2015, 9:29 PM ET) — A former Federal Reserve Bank of New York staffer on Wednesday pled guilty to stealing government property and admitted to leaking confidential information to a former colleague who left to work at Goldman Sachs, a week after the investment bank agreed to pay $50 million over the ordeal.

An former staffer at the Federal Reserve Bank of New York pled guilty Wednesday to leaking information to a Goldman Sachs employee. (Credit: AP) Jason Gross, 37, appeared before U.S. Magistrate Judge Gabriel W. Gorenstein in a Manhattan…

Source: Law360