Daily Archives: January 14, 2016

Judge’s finances show history of unpaid debt, IRS liens, foreclosures

Foreclosures, liens and unpaid debts.

These dominate the financial record of Palm Beach County Circuit Judge Martin Colin and his wife, Elizabeth Savitt, a professional guardian. The couple have enormous power over the life saving of seniors no longer competent to care for themselves because of dementia or medical illness.

The pair’s financial difficulties peaked in the Great Recession. Then in 2011, Savitt became a paid professional guardian and much of their financial distress dissipated, including when Savitt paid off a $308,000 foreclosureon a Delray Beach house that was set to be auctioned off in March.

So where has all the money gone?

Colin earns a $146,000 annual salary as a circuit judge. Savitt was previously a tennis pro and a 2007 affidavit from a post-divorce proceeding show assets as high as$1.27 million.

Despite this, Colin’s financial records show he has repeatedly borrowed money from clients from his days as a divorce attorney.

Read on.

Allied Irish, Citigroup settle litigation over rogue trader

Citigroup Inc (C.N) has settled long-running litigation in which Allied Irish Banks Plc (ALBK.I) accused it of helping rogue currency trader John Rusnak rack up a $691 million loss.

U.S. District Judge Deborah Batts in Manhattan on Thursday ordered the dismissal of the 12-1/2-year-old case, in which government-controlled AIB sought $500 million of compensatory damages plus punitive damages.

Terms of the settelement were not disclosed. The dismissal averts a trial scheduled to begin on Jan. 25, over a fraud that was at the time one of the largest on record to involve unauthorized trades.

Read on.

Really? A Badly Behaved Banker’s List?

There’s talk of a master list being created that would list Wall Street bankers who’ve run into ethical issues on the job.
It could develop into a pretty long list. And then what next? Which other group would be targeted? Supposedly the purpose of this list would be to help companies avoid hiring the repeat offenders who move from firm to firm. New York Federal Reserve President William Dudley recently floated the idea to a gathering of bankers and regulators, in an ongoing effort to improve Wall Street’s culture, which Dudley has called “an apparent lack of respect for law, regulation, and public trust that persists within some large financial institutions.”
Yes, absolutely there is cause for concern; the issues are ongoing.

J.P. Morgan’s Dimon Sounds Caution on Economy

J.P. Morgan Chase & Co.’s bankers and traders took pay cuts. Bad energy loans are piling up. And Chief Executive James Dimon said major parts of the economy are “obviously” going to get worse.

But the nation’s biggest bank by assets still posted quarterly results that beat expectations and full-year profits that came within a hair’s breadth of being the biggest ever on Wall Street.

The results show that the persistent hand-wringing over the state of the banking industry and the health of the economy hasn’t hurt J.P. Morgan much, though both concerns are likely to persist and possibly deepen in 2016.

Read on.

How Rep. Scott Garrett’s anti-gay views are splintering Wall Street

The Congressman is biting the hand of the banksters that bankrolls him..


Bloomberg does a deep dive into Garrett’s anti-gay views and the impact those views are likely to have on his continued status as a U.S. Congressman.

The whole thing (and it is a long piece) is well worth your time, but here are few choice excerpts.

The controversy around Garrett began last year, when at a private caucus meeting, he declared that he was going to withhold “hundreds of thousands of dollars” from the National Republican Congressional Committee because of its support for gay candidates.

And according to the Bloomberg piece, Garrett controls a lot of money:

From Bloomberg:

Garrett’s committee is vital to Wall Street. “The rules of the road for handling money and anything with the SEC go through this committee,” says Marcus Stanley, policy director of the nonprofit Americans for Financial Reform. “There’s a ton of money at stake.” In Washington, the committee is known as the ATM, because banks and hedge funds shower the chairman with contributions. After the Dodd-Frank financial law forced hedge funds to register with the Securities and Exchange Commission, Garrett, already the recipient of more Wall Street money than almost any other member of the House, got millions more. The banks pay to have a voice, ensure they’re at the table when new rules are discussed, and insinuate themselves into the chairman’s good graces.

According Bloomberg, most of the money that Garrett collects from Wall Street is supposed to be passed along the Republican Party’s campaign fund, but Garrett’s anti-gay declaration “threw a wrench” into the process.

Again from Bloomberg:

At a private caucus meeting, (Garrett) got into a heated dispute with his colleagues by declaring that he’d withhold hundreds of thousands of dollars in National Republican Congressional Committee dues to protest the party’s support for gay candidates. His outburst immediately caused a rift in the caucus. “I was shocked,” says Richard Tisei, a Massachusetts businessman who was one of the candidates Garrett objected to. “The first time I ran, I was nervous my sexuality would be a problem. But everyone was just great. John Boehner, Paul Ryan—they went out of their way to let me know it wasn’t. Eric Cantor pulled me aside and said, ‘You know, I’m the only Jew in the caucus, so I understand better than anyone how important it is to have you down here to broaden and diversify our ranks.’ ”

But Garrett’s views aren’t only causing a problem within his own party, where many Republicans, perhaps sensing the shift in public opinion about gay rights, have begun to embrace gay candidates.

According to Bloomberg, Wall Street, which acts as one of Garrett’s largest benefactors, is apparently experiencing a crisis of conscience over Garrett’s views.

Again from Bloomberg:

The political fallout from Garrett’s remarks pales compared with the anguish it’s created in some corners of Wall Street. The financial industry ranks among the biggest donors to the Republican Party. But it has also been a pioneer in advancing gay rights. Garrett’s reelection race presents banks and investors with a fascinating—and excruciating—moral dilemma: Do they follow their financial interests and continue supporting a chairman whose antiregulatory views largely jibe with their own? Or do they honor their professed commitment to LGBT equality by cutting off that support and potentially angering a powerful industry overseer?

According to the Bloomberg report, Goldman Sachs, JPMorgan Chase, UBS,Citigroup, and others on Wall Street were among Garrett’s largest campaign donors in his last re-election campaign, but Garrett’s statements on gays and lesbians are leading Wall Street to re-consider its support of Garrett.

MONEY MONSTER – Official Trailer

Let’s hope CNBC Cramer watches this movie. Interesting that there are more Wall Street movies as well as TV series.

Deadly Clear

Follow the Money with George Clooney & Julia Roberts.

Published on Jan 12, 2016

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Ted Cruz Forgot To Mention That Wall Street Financed His Senate Bid

As Ted Cruz tells it, the story of how he financed his upstart campaign for the United States Senate four years ago is an endearing example of loyalty and shared sacrifice between a married couple.

“Sweetheart, I’d like us to liquidate our entire net worth, liquid net worth, and put it into the campaign,” he says he told his wife, Heidi, who readily agreed.

But the couple’s decision to pump more than $1 million into Mr. Cruz’s successful Tea Party-darling Senate bid in Texas was made easier by a large loan from Goldman Sachs, where Mrs. Cruz works. That loan was not disclosed in campaign finance reports.

Those reports show that in the critical weeks before the May 2012 Republican primary, Mr. Cruz — currently a leading contender for his party’s presidential nomination — put “personal funds” totaling $960,000 into his Senate campaign. Two months later, shortly before a scheduled runoff election, he added more, bringing the total to $1.2 million — “which is all we had saved,” as Mr. Cruz described it in an interview with The New York Times several years ago.

Read on.

The Rise of Shadow Banks and the Repeal of the Glass-Steagall Act


The US accounted for the largest shadow-banking sector, with $14.2 trillion in 2014.

The Increasing Size of Shadow Banking in the US

Investment banks, structured investment vehicles, hedge funds, non-bank financial institutions, money market funds, mutual funds and exchange-traded funds are all a part of the shadow banking system and are not required to maintain any reserves or emergency capital. “No regulations” in a “regulated environment” could be the biggest worry of the shadow banking system. Often beyond the control of regulators and monetary policy, shadow-banking activities can resort to risky lending. According to the New York Fed, shadow banks have “increased the fragility of the entire financial system.” While the total of non-bank financial intermediaries decreased immediately after the 2008 financial crisis, the number of shadow banks have picked up in recent years.

The vulnerabilities of the traditional banking system to the unregulated risks undertaken by the shadow banking system continue to threaten the financial system in 2016. According to the Financial Stability Board’s Global Shadow Banking Monitoring Report 2015, the United States accounted for the largest shadow-banking sector, with $14.2 trillion in 2014. The figure is more than one-third of global shadow banking assets, and represents 82 percent of the nation’s GDP.

With more than 80 percent of shadow banking activities residing in the advanced economies of North America, Asia and northern Europe, shadow banking could be one of the biggest threats to the current financial system. The report identifies the difficulty in assessing the amount of risk involved due to the lack of detailed data. The Financial Stability Board, an international board that monitors the global financial system, said the shadow-banking sector posed a huge risk of $36 trillion across 26 jurisdictions across the world in 2014.

Order halting ‘illegal’ foreclosure evictions expires

A temporary restraining order stopping the eviction of four Metro Detroit families was allowed to expire Wednesday, despite pleas that the homes were illegally tax foreclosed and sold to developers.

U.S. District Judge Judith Levy on Wednesday declined the families’ request that she extend the order against the developers by issuing a preliminary injunction. Levy questioned whether she had jurisdiction over the lawsuit, which involved claims of a botched foreclosure process typically heard in state court.

“I am not convinced of the likelihood of success at this point,” Levy said, who issued the original 14-day temporary restraining order late last month. “I have to simply say I don’t have the legal authority to issue the order you are seeking.

Read on.

HSBC ‘Scot Free’ Over Swiss Tax Dodge Claims

HM Revenue and Customs boss Dame Lin Homer has been accused of allowing HSBC to “get away scot free” after she said it was unlikely to pursue allegations that the bank’s Swiss arm helped wealthy clients dodge tax.

Dame Lin confirmed to the Commons Public Accounts Committee that the authority would be unlikely to take action against the banking giant.

The admission comes after the Financial Conduct Authority announced it would not take any formal action on the allegation.

It prompted Conservative MP Stephen Phillips, who sits on the committee, to complain: “It looks as though they have got away scot free.”

Read on.