Daily Archives: August 27, 2016

JPMorgan Chase Getting Into The Car-Buying Business

JPMorgan Chase is getting into the car-buying business, gearing up to launch a digital offering that enables customers to shop for a car and get financing for their purchase using a computer or smartphone.

According to a report by The Wall Street Journal, the new service, dubbed Chase Auto Direct, will be powered by TrueCar, which is an online car-buying site. The idea behind the partnership is to speed up the car-buying process, and it is the latest example of a financial services company getting into bed with a financial technology firm.

In 2015, JPMorgan inked a partnership with OnDeck to develop an online small business loan portal for the bank’s customers. With the OnDeck partnership, the online lender’s name was featured on the product, but with this car-buying initiative, TrueCar will remain behind the scenes.

Auto finance customers will start at Chase.com, navigate to a TrueCar site and then end up back at Chase’s site to apply for the secure financing. With the service, customers will be able to find and look at financing options for new and used cars and get approved for their loan. They can compare prices that other consumers pay and see options among different dealerships that are part of the bank’s network. The service will be available to existing customers in 30 states in the U.S., with it being rolled out further in phases at the beginning of next year.

Read on.

The EpiPen Scandal Is Worse Than You Think: What You’re Not Being Told

Zerohedge:

Submitted by Alice Salles via TheAntiMedia.org,

The EpiPen is a useful device for individuals who suffer from severe allergies. So when news broke that Mylan, the sole maker of the autoinjector “pens” in America, had hiked the prices of its products from $57 each in 2007 to $600 for a package of two in 2016, news outlets had a field day.

Promptly after, politicians seized the opportunity to bank on this crisis by promising to “do something.”

Presidential hopeful Hillary Clinton urged Mylan to voluntarily slash the prices of its products whilepromising that, once she’s elected, her plan to address exorbitant drug price hikes like these” will be finally implemented. This is a particularly empty promise considering Mylan has donatedbetween $100,000 and $250,000 to the Clinton Foundation, which was recently revealed to be peddling influence in exchange for cash.

Senators Susan Collins (R-ME) and Claire McCaskill (D-MO) are also pressuring the manufacturer to disclose more about its pricing. Even Senator Joe Manchin (D-WV) — whose own daughter, Heather Bresch, serves as Mylan’s CEO — weighed in, claiming he, too, shares his colleagues’ “concerns about the skyrocketing prices of prescription drugs.”

But none of what these politicians are saying rings true to anyone who’s paying attention. Here’s why.

The Monopolistic Origins of the EpiPen

The autoinjector known as the EpiPen provides injections of epinephrine in cases of serious or even life-threatening allergy attacks. It is derived from another product known as the Mark I NAAK ComboPen, a device created for a monopoly: the U.S. military.

The device was designed by Sheldon Kaplan for Survival Technology, Inc., a company with a long history of working with the Pentagon. Once the ComboPen was created, it was sent to the U.S. military to treat soldiers who had been exposed to nerve agents.

In 2007, Mylan “purchased the generic drugs division of Germany’s Merck KGaA for $6.7 billion,” acquiring the EpiPen brand of autoinjectors. Under Merck, the devices cost $7 each, which resulted in just $200 million in gains each year, a mere 5 percent of Merck’s revenue at the time.

But Bresch saw potential in this simple plastic device and focused on how to make the newly purchased brand something that could be widely used. For her dream to come true, she needed the assistance of experts in the monopoly business. That’s when she turned to the U.S. government for help.

The FDA, Washington, and Crony Capitalism Are All to Blame

Though the EpiPen is not covered by patent protection, Bresch’s close relationship with Washington may have helped her company ensure competition wasn’t an issue.

In an article for the Mises Institute, Jonathan Newman writes that Mylan has been repeatedly protected from competition, and it has repeatedly (and predictably) increased the price of EpiPens in response.”

According to Bloomberg, Mylan has been aggressive in its approach to regulators.

For the past seven years, Bresch has been “[turning] to Washington for help. Along with patient groups, Mylan pushed for federal legislation encouraging states to stock epinephrine devices in schools.”

In 2010, when the FDA launched new federal guidelines related to epinephrine prescriptions, Mylanstopped selling single pens, switching to twin-packs. Bloomberg reports that, at the time, “35 percent of prescriptions were for single EpiPens,” but as the new rules were implemented, Mylan “changed label rules to allow the devices to be marketed to anyone at risk.” While the guidelines targeted persons who had severe allergic reactions only, Bresch saw the rule changes as “big events that we’ve started to capitalize on,” she said in October of 2011.

After a seven-year-old died due to an allergic reaction to peanuts at a Virginia school, Congress passed a law pressuring states to ensure its schools had epinephrine devices on hand at all times. The year this bill passed, Mylan spent over $1 million in lobbying alone. Now, Bloomberg reports, “47 states require or encourage schools to stock the devices.”

As part of the EpiPen popularization plan, Mylan started handing out “free EpiPens to more than 59,000 schools” in 2012. In 2014, the company allegedly spent $35 million on TV ads, and in 2015, Mylan signed a deal with Walt Disney, stocking theme parks and cruise ships with the devices. Between 2012 and 2015, the company also spent over $6 million in lobbying.

Over the past seven years, Bresch’s persistence and power-driven attitude helped the company spread the EpiPen far and wide, causing its use to grow 67 percent in the United States. EpiPen prescriptions are now so common that pediatric allergist Robert Wood from Johns Hopkins University School of Medicine says EpiPen is the new “Kleenex.”

But making the EpiPen so popular wasn’t an easy task, mostly because Mylan finally bumped into some competition along the way.

Trump’s Doctor Has An Amazing Explanation For That Bizarre Medical Report

He says he only spent five minutes writing the note.

Donald Trump’s personal physician told NBC News that he wrote a now-infamous medical report about the candidate in just five minutes.

Dr. Harold Bornstein, a gastroenterologist who has been Trump’s doctor for more than three decades, released a brief note last December declaring the reality TV star would be “the healthiest individual ever elected to the presidency.” The four-paragraph letter, which billed Trump’s health as “astonishingly excellent,” was far less detailed than medical reports traditionally released by presidential candidates.

In an interview with NBC airing Friday, Bornstein said he spent “five minutes” on the letter while a car sent by Trump waited for him outside his office in Manhattan.

“I get rushed and I get anxious when I get rushed, so I try to get four or five lines done as fast as possible,” Bornstein explained. “In a rush, I think some of those words didn’t come out exactly the way they were meant.”

The doctor stood by his assessment of the reality TV star’s wellness.

“His health is excellent, particularly his mental health,” he said.

He also defended the claim that Trump would be the healthiest president in history.

“I like that sentence to be quite honest with you, and all the rest of them are either sick or dead,” he said.

Read on.

AIG’s Post-Bailout Tax Suit Faces Jury Trial

MANHATTAN (CN) — Since receiving a $182 billion bailout, the American International Group has been roundly mocked for lawsuits demanding more government money, but the insurer’s lawyers agreed on Friday to let a jury decide the last of these cases.
As U.S. District Judge Louis Stanton noted at a hearing this morning, AIG did not have much of a choice.
The government already filed a demand for a jury trial on AIG’s lawsuit from six months after its bailout, which seeks a $306 million refund over tax credits from seven foreign transactions in Ireland, France, New Zealand and elsewhere during the mid-1990s.
The lawsuit has been on a four-year pause since early 2013, when Stantonrefused AIG’s motion for summary judgment, leading to a series of appeals.
Friday morning’s proceedings ending that hiatus opened informally around a conference table, where Judge Stanton presided in a suit instead of his judicial robes.
In a faux-naive tone, Stanton asked the lawyers: “What have you been up to since I saw you last?”
Quite a lot, as it turned out.
Since the parties last met, two other attempts by AIG’s ex-CEO Maurice “Hank” Greenberg — through AIG’s shareholder Starr International Co. — to recover $40 billion in damages over the terms of the government’s bailout crashed and burned. (AIG itself was not a plaintiff these lawsuits, but a storm of public outrage followed a New York Times report from 2013 that its board considered joining them.)
The Federal Reserve conditioned AIG’s rescue on it holding a roughly 80 percent stake in the company.

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Donald Trump Loses Bid To Block Experts In Trump U. Suit

SAN DIEGO (CN) — A federal judge heard arguments Friday from attorneys on both sides of a class action claiming Trump University tricked students into paying for bogus real estate tips, as the lawyers tried to convince the judge that a host of experts should be excluded from testifying.
U.S. District Judge Gonzalo Curiel issued a tentativeorder Thursday granting in part and denying in part motions from lead class-action plaintiff Art Cohen and Republican presidential nominee Donald Trump asking to bar witnesses retained for the 3-year-old case.
Cohen and the other plaintiffs sued Trump in 2013 under the Racketeer Influenced and Corrupt Organizations, or RICO, Act, claiming he knowingly defrauded students out of thousands of dollars when they paid for Trump University seminars based on the claim that they would learn insider real estate secrets from instructors “handpicked” by Trump himself.
The experts at issue at Friday’s hearing were retained to determine the educational value of a Trump University education.
Cohen’s expert Paul Habibi found that a real estate education from Trump University was worth nothing, while Trump’s expert Alan Wallace found a Trump University education did, in fact, have value.

Read on.

HSBC To Pay $13M To End Privacy Row Over Recorded Calls

Law360, Los Angeles (August 26, 2016, 10:28 PM ET) — HSBC Card Services Inc. has agreed to pay $13 million to resolve a consolidated proposed class action accusing the company of unlawfully recording debt-collection calls without the consent of consumers, according to documents filed Friday in California federal court.

In three nearly identical putative class actions, consumers accuse HSBC of violating the California Invasion of Privacy Act by recording without permission phone conversations with California account holders discussing their HSBC credit card accounts. (Credit: AP) In asking U.S. District Judge James V. Selna to grant preliminary…

Source: Law360

 

PwC settles $5.5 billion lawsuit over Taylor, Bean & Whitaker audits

The ghost of Taylor, Bean & Whitaker struck again Friday, asPricewaterhouseCoopers agreed to settle a $5.5 billion lawsuit that accused the company of failing in its audits duties by not discovering the accounting malfeasance that led to one of the most spectacular crashes to come out of the housing crisis.

The news of the settlement comes courtesy of Reuters, which reported that the lawsuit stemmed from PwC’s auditing work at Colonial Bank, which provided funding to TBW originate mortgages.

TBW was, at one time, the largest privately held mortgage company in the U.S., employing over 2,000 people. TBW originated, serviced and sold mortgages in pools toFreddie Mac.

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