Search

The article discusses the role of former Bank of New York Mellon Corp. (BNY) currency trader Grant Wilson in gathering evidence that led to lawsuits filed against the bank by the U.S. Justice Department and others, alleging BNY defrauded its currency-trading customers by overcharging them. While working for BNY, Wilson was part of a group investigating currency trading that included fraud investigator Harry Markopolos.

The article reports that the U.S. Justice Department and New York attorney general Eric Schneiderman have filed civil suits against banking company Bank of New York Mellon Corp., alleging it engaged in fraud by overcharging investors on currency transactions it handled for them. A group led by fraud investigator Harry Markopolos helped instigate the suits.

The article states that the U.S. Justice Department and New York's attorney general have both filed civil lawsuits alleging fraudulent charges by Bank of New York Mellon Corp. (BNY Mellon) for client currency transactions. It states that New York's civil case alleges federal law violations and claims BNY Mellon defrauded federally insured banks. It mentions law enforcement officials are probing BNY Mellon and State Street Corp. on how they allegedly handled currency costs for pension funds.

The article discusses credit-default swaps as an indicator of fear and uncertainty regarding stocks, bonds, and sovereign debt. The publication's analysis of swaps indicates trading volume tends to be sparse, and in some instances quoted swap prices have not been based on actual trades. It is suggested this shows that swap prices exert an unduly large influence on investor psychology.

The article discusses concerns about European banks. BNP Paribas SA is among French banks whose share prices have fallen steeply during 2011. Banking company Morgan Stanley's stock price fluctuated sharply in response to reports about its exposure to French banks. The price of credit default swaps to insure against defaults by European banks has risen.

The article reports that the Swiss bank UBS AG raised its estimate of the losses suffered in unauthorized securities trading attributed to former employee Kweku Adoboli to $2.3 billion. An anonymous source is cited in a report that other bank employees knew of Adoboli's activities well prior to UBS' detection and announcement of the large losses involved.

The article reports on the case of Kweku Adoboli, a trader at the Swiss bank UBS AG, who was charged with fraud. Adoboli was accused of making unauthorized trades, beginning in 2008, which resulted in some two billion dollars of losses. Information about his hearing at the Magistrates' Court in London, England on September 16, 2011 is presented.

The article discusses signs of a worsening financial crisis in Europe. Ratings firm Moody's Investors Service downgraded the debt of two French banks, Société Générale and Crédit Agricole. The European Central Bank disclosed it had extended $575 million in U.S. dollar loans to two undisclosed banks. European financial institutions have found it more difficult to secure the dollars they need for funding purposes.

The article reports that the publication's examination of foreign currency transactions conducted by banking company Bank of New York Mellon Corp. (BNY Mellon) on behalf of pension funds Massachusetts Pension Reserves and Los Angeles County Employees Retirement Association reveal the trades were performed in a way that boosted profits for BNY Mellon while incurred added costs for the funds. BNY Mellon's trading practices have drawn the attention of state regulators in the U.S.

The article discusses the impact on European banks, particularly France's, of growing concerns about a debt crisis in Greece. On September 12, 2011 shares of several bank stocks including Société Générale SA and BNP Paribas SA fell sharply. Société Générale chairman Frédéric Oudéa held a press conference to offer assurances that his bank has ample funding.

The article discusses chairman and chief executive officer Gerald L. Hassell of banking company Bank of New York Mellon Corp. He has been at Mellon in various capacities for 38 years and is considered to have many loyal supporters among its senior managers. In the aftermath of replacing his predecessor, Robert P. Kelly, Hassell must cut costs and grow profits amid an environment of low interest rates.

The article reports that Robert P. Kelly, chief executive of banking company Bank of New York Mellon Corp., has resigned his position. Kelly acted after the bank's independent directors unanimously agreed he should leave. The board reportedly believed Kelly's behavior had alienated some Mellon executives, and feared key employees would leave the bank if Kelly stayed on. He will be replaced by Mellon executive Gerald L. Hassell.

The article discusses doubts in the credit market about banking company Bank of America Corp. The cost of swaps used to insure against default on the bank's bonds has risen substantially. A ten-year bond issued by the company in 2011 has seen its yield rise to 6.5%. Credit strategist Edward Marrinan says markets seem to be concerned over the bank's capital levels.

The article reports that stock prices in the U.S. and Europe fell due to investors' concerns about the finances of European banks. The Dow Jones Industrial Average declined by 1.6 percent. European bank stocks fell significantly, including the stocks of large banks Deutsche Bank AG and Barclays Bank PLC. It is noted bank stocks are particularly vulnerable to rumors due to the lack of information on bank finances.

The article discusses heightened concern on the part of state and federal officials in the U.S. about the ability of foreign banks' U.S. operations to obtain adequate funding. The Federal Reserve Bank of New York has been meeting with banks to evaluate their funding needs. Deutsche Bank AG and UniCredit SpA are among large European banks that do business in the U.S.

The article reports that attorneys general in Florida and Virginia have separately sued banking company Bank of New York Mellon Corp. for alleged improper pricing of currency transactions Mellon processed for pension funds in those states. A 2008 internal document at the bank said volatility in currency prices helped Mellon achieve greater profits when trading on behalf of institutional customers.

The article discusses real-estate appraisals in the U.S. Some believe a recovery in the U.S. housing market has been hampered by unrealistically low appraisals. Lawrence Yun of the National Association of Realtors believes low appraisals are responsible for a rise in the number of canceled home sales.

The article discusses financial stress in Europe as reflected in the actions of some European Union banks. Currency markets have become a more important source of bank funding, as lending between banks and bond sales have waned. Banks are also depending more on the European Central Bank for financing.

The article reports that New York Attorney General Eric Schneiderman is preparing to take charge of an investigation into whether banks including Bank of New York Mellon Corp. and State Street Corp. overcharged state pension funds on currency transactions. Schneiderman could make use of New York's Martin Act, which would give him power to cross state lines in the course of the probe.

The article discusses the diminished significance of the London interbank offered rate (Libor) as a measure of the global banking industry's health. For various reasons banks have accumulated large cash reserves and had little reason to borrow from each other, thus keeping Libor low and detracting from its value as an industry indicator.

The article considers a significant fall in prices of mortgage bonds in May-June, 2011 and its effect on investment banking and banking industry finance. A cycle is discussed in which risk aversion led investment banks of large banking industry firms to seek to sell mortgage bonds when prices first declined, thereby creating further declines and causing lower profits in the securities trading that is a major revenue center for large banks.

The article reports that Swiss bank UBS AG is assisting regulators in an investigation into whether several banks manipulated the London Interbank Offered Rate (Libor) during the global financial crisis of 2008-2009. The U.S. Justice Department and Securities and Exchange Commission are among agencies seeking to determine if banks under-reported their own borrowing costs in an effort to mislead competitors.

The article discusses intense competition among banks to provide floating-rate loan to companies. Investor demand for such securities coupled with a desire by banks to increase their loan revenues has prompted them to offer attractive terms to corporate clients. Williams Schwartz of ratings firm DBRS expresses concern that in an effort to gain business, the banks could be lowering their lending standards.

The article reports that the U.S. Securities and Exchange Commission (SEC) is investigating financial-services firms Bank of New York Mellon Corp. and State Street Corp. regarding their handling of foreign-exchange transactions for public pension funds. Of particular concern to the SEC is how Mellon and State Street represented their services to their clients.

The article discusses the Bank of New York Mellon Corp.'s pricing of foreign-exchange transactions for pension fund Los Angeles County Employees Retirement Association. Figures indicate the bank has had a tendency to conduct currency transactions at prices unfavorable to the bank over a ten-year period. The two sides differ over whether the bank must act as a fiduciary for the fund in such trades.

The article discusses a report from the U.S. Senate on the U.S. mortgage market in the years leading up to the global financial crisis of 2008-2009. Investment bank Goldman Sachs Group Inc. was criticized for selling mortgage-backed securities while believing those securities would decline in value. In 2004 financial-services firm Washington Mutual ignored it's risk officer's warning that house prices were set to fall.

The article discusses a report to be released by the U.S. Senate Permanent Subcommittee on Investigations on the role of the securities industry in the real estate bubble leading to the 2008 global financial crisis. It is reported that the government's report will center on the role of Goldman Sachs Group Inc. and Deutsche Bank AG in the creation and marketing of derivative securities based on so-called subprime mortgages.

The article discloses that a 2006 internal report at the government-sponsored enterprise Fannie Mae warned that foreclosure attorneys in Florida sought to hasten foreclosures by being dishonest, and questioned the legal standing of some mortgage services to foreclose on properties. A spokeswoman for Fannie said the firm took action to address issues it was aware of.

The article reports that investigators from several U.S. agencies including the Justice Department and Securities and Exchange Commission are looking into whether the London interbank offered rate (LIBOR) was manipulated by certain U.S. and European banks. UBS AG is among banks that have been contacted.

The article reports that the pension fund Los Angeles County Employees Retirement Association has curtailed its currency-trading business with Bank of New York Mellon Corp. Mellon has served as a custody bank for the fund, which is not pleased that Mellon has profited from some of the fund's foreign-currency transactions.

The article discussed foreign-exchange brokers Gain Capital Holdings Inc. and FXCM Inc. Both firms went public in December, 2010 amid growing interest by retail investors in trading currencies. Since then, though, their share prices have fallen. FXCM's trading volume has been less than anticipated, and Gain has paid a $459,000 fine to the National Futures Association for various infractions.

The article reports that some banks are believed to have charged large U.S. investment companies excessive amounts for foreign-currency trades. Bank of New York Mellon Corp. is among banks suspected by investment firm BlackRock Inc. of overcharging on trades. Attorneys general in Florida, Virginia, and California have sued custody banks for taking improper profits on currency trades for their clients.

The article discusses quail hunting, and in particular quail hunting at the Willowin Plantation in Lax, Georgia. Owned by the family of William O. Wingate IV, Willowin strictly limits the number of hunters who can participate. The author describes elements that make for good quail hunting, and details his two-day Willowin hunting expedition.

The article discusses litigation filed against several custody banks in the U.S. alleging they overcharged state pension funds on foreign-currency trades. Special attention is paid to charges by Delaware shell company FX Analytics that Bank of New York Mellon Corp. used false trades to cheat Virginia state pension funds out of $20 million or more.

The article reports that attorneys general in California and Virginia are receiving help from whistle-blowers in an investigation into whether public pension funds were overcharged by banks for foreign-exchange transactions. Assisting the whistle-blowers is investor Harry Markowitz, who was early to detect a Ponzi scheme perpetrated by convicted swindler Bernard Madoff.

The article reports that U.S. banks are imposing tougher terms on municipalities seeking to renegotiate bond deals. Not all banks are renewing expired letters of credit, and those that are have begun charging more for them, and demanding that the recipients transfer over more of their fee-generating business.

The reports that some corporate bond issuers are taking advantage of a provision that lets them repurchase up to 10% of their outstanding issues at a price of $1.03 per dollar of face value. In some instances the bonds are trading higher than $1.03, forcing investors to absorb losses. Investors lost an estimated $20 million when Lyondell Chemical Co. bought back around $275 million of its notes.

The article reports that hedge funds and other investors who made profitable bearish trades amid the global financial crisis of 2009-2009 were among recipients of aid from the U.S. Federal Reserve's Term Asset-Backed Securities Loan Facility (TALF). Financial firms Magnetar Capital, Tricadia Capital, and others benefited from TALF loans.

The article reports hospital-operator HCA Inc. will establish a separate firm called HCA Holdings Inc. that will issue $1.5 billion in junk bonds to finance a dividend to the firm's private-equity owners, among them KKR & Co. and Bain Capital. Attorney Chris Chaice says the new company provides a way for HCA Inc. to sidestep restrictions on debt and dividends.

The article discusses the efforts of the U.S. Justice Department's U.S. Trustee Program to ensure that law firms and mortgage processor Lender Processing Services Inc. are properly handling foreclosures. Particulars are given about a foreclosure in Monroe, Louisiana involving the Boles Law Firm that resulted in Boles agreeing to a two-year period of federal supervision of its bankruptcy cases.

The article reports that private-equity firms are on pace during October, 2010 to extract record-high dividends from the companies they own. Expectations that U.S. taxes on dividends could rise in 2011 are helping to fuel such transactions. Critics say that increasing a firm's debt to provide dividend to owners can harm its long-term prospects.

The article reports that the Florida state attorney general is investigating mortgage-processing firm Lender Processing Services Inc. along with several Florida law firms in connection with the handling of mortgage documents in foreclosure proceedings. Questions have arisen as to whether documents were properly reviewed, or in some cases fabricated.

The article reports that investment banks in Europe and the U.S. are shifting toward business models that involve less risk. Contributing factors include tighter regulation and a reduction in securities-trading volume. Swiss bank authorities have recommended higher capital requirements than called for by the Basel Committee on Banking Supervision, and regulators in other nations could follow suit.

The article discusses efforts by investors in mortgage-backed securities to force sellers to either modify or repurchase them. The Federal Home Loan Banks of Pittsburgh, Pennsylvania and San Francisco, California have sued large banks to achieve this end. In a similar action attorney Talcott Franklin of Dallas, Texas represents investors in 2,300 mortgage securities.

The article discusses the strong demand for junk bonds. In September, 2010 prices for junk bonds reached levels not seen since 2007. During 2010 firms have sold a record $172 billion in junk bonds. In some instances companies have been able to sell securities with fewer covenants than usual, thus presenting additional risk to investors.

The article discusses the U.S. Office of Financial Research (OFR). Housed within the Treasury Department, OFR is authorized to collect sensitive trading and loan data as it seeks to identify emerging systemic risks to the financial system. Special attention is paid to Professor John Liechty, who lobbied for OFR's creation.

The article discusses the U.S. Securities and Exchange Commission's (SEC's) investigation into the 2008 collapse of investment bank Lehman Brothers Holdings Inc. Attention has focused on whether Lehman used creative accounting to mask its true debt levels. The SEC is also probing whether Lehman executives disclosed to investors losses arising from its purchase of development company Archstone-Smith Trust.

The article discusses an investigation by New York state and the U.S. of European banks who have engaged in money laundering and other practices designed to allow foreign countries such as Iran and Sudan evade economic sanctions. The role of former intelligence analyst Eitan Arusy, an investigator for New York prosecutors, is examined.

The article reports that regulatory changes and a weak U.S. economy have prompted layoffs in the U.S. financial-services industry. Barclays PLC has gotten rid of about 400 employees, and Jean-Yves Fillion of bank BNP Paribas SA expects additional layoffs in the U.S. investment-banking industry. Employment in the U.S. securities industry is down 6.7% since 2007.

The article reports that Sea Island Co., a resort in Sea Island, Georgia, will sell itself to investment funds Oaktree Capital Management and Avenue Capital Group for $197.5 million, and then seek bankruptcy protection. The resort found itself unable to service hundreds of millions of dollars in debt contracted for by chief executive Bill Jones III to finance a renovation and expansion during 2006-2007.