Network For Investor Action & Protection

Why Leaders Like Jamie Dimon Live to Fight Another Day: Survival Tips

admin — Wed, 16 May 2012 18:04:52 +0000

Jamie Dimon, CEO of JP Morgan, is a great survivor, which is why we believe the hoopla over the loss he reported will be forgotten. He will take all the hearings, attacks and investigations in stride. He will duck, bob and weave. And, most importantly, he will live to fight another day. It’s important that all leaders learn to survive attacks and walk away unscathed. In survival training, you learn you don’t have to win every battle, just endure them. But you do have to take some calculated risks to advance your career. To be triumphant in promotions at work, you don’t have to be the most glorious warrior or the most beloved saint. You have to succeed in testy skirmishes and you can’t annoy anyone too badly. More in Forbes here.

Hedge or Bet? Parsing the J.P. Morgan Trade

admin — Wed, 16 May 2012 17:59:40 +0000

J.P. Morgan Chase & Co.’s trading losses of more than $2 billion centered on a complicated three-step strategy that could raise new questions about whether the bank was hedging its risks or making a big bet. The size and complexity of the trades suggest to some critics that the bank might have been seeking to generate profits rather than to simply protect its giant portfolio of corporate loans and other holdings from losses. More in the Wall Street Journal here.

Common schemes still pervade

admin — Wed, 16 May 2012 17:55:03 +0000

We think that because Bernie Madoff is in jail the world is safe for investors. Retirees think so and are looking for ways to produce income from savings. Scammers know this and think up ways even Madoff hadn’t, according to the FBI’s website. Investment schemes all have one thing in common: they promise large returns on investments with very little risk. Such offers usually arrive unsolicited, and their potential targets are contacted by email, phone or even by U.S. mail; but the “prime caveat” still applies: “If it sounds too good to be true, it probably is.” More on Tulsa World here.

JPMorgan was warned risk management not up to task

admin — Wed, 16 May 2012 17:53:28 +0000

CtW Investment Group, a labor-backed shareholder group, last year warned JPMorgan Chase & Co that its risk management committee was not up to the task and sought to remove one of its members, Ellen Futter, who had been a director at American International Group Inc (AIG) before its near-collapse in 2008. “We are deeply concerned that the current three-person risk policy committee, without a single expert in banking or financial regulation, is simply not up to the task of overseeing risk management at one of the world’s largest and most complex financial institutions,” an April 1, 2011, letter from CtW said. More on CNBC here.

Washington uses JPMorgan to double down on reforms

admin — Wed, 16 May 2012 17:50:37 +0000

Reverberations from JPMorgan Chase’s multibillion-dollar trading loss deepened in Washington on Tuesday, with the Democratic leader of the Senate blasting the nation’s largest bank for “gambling” and congressional Republicans putting the brakes on a plan to soften Wall Street reforms. Both Republicans and Democrats are still trying to understand the political implications of the trading debacle at one of Wall Street’s highest-profile banks as they gauge how it will play in the election-year debate. Read CNBC report here.

ABN Amro, Feeder Funds Win Review of Madoff Trustee Suits (Update 1)

admin — Wed, 16 May 2012 17:49:07 +0000

ABN Amro Bank NV and investment funds sued by the liquidator of Bernard Madoff’s brokerage succeeded in moving their cases to a district judge who may cut the amount of money the Madoff trustee can try to reclaim. U.S. District Judge Jed S. Rakoff in Manhattan said yesterday he would take a group of suits out of bankruptcy court, mostly to convey decisions he already made in trustee Irving Picard’s cases against HSBC Holdings Plc (HSBA) and the New York Mets owners, including high standards Picard must meet to show money wasn’t withdrawn in good faith. Read Bloomberg report here.

JPMorgan’s Zames Shakes Up Investment Office After Loss

admin — Tue, 15 May 2012 18:00:14 +0000

JPMorgan (JPM) Chase & Co.’s Matt Zames, newly appointed to lead the bank’s chief investment office after the unit suffered a $2 billion loss, shook up leadership and announced a “renewed focus” on hedging risks. Zames named new finance and risk chiefs and wrote in a staff memo yesterday that top London-based trading executive Achilles Macris would hand off duties. JPMorgan named Zames head of the office to succeed Ina Drew, whose retirement yesterday after the surprise loss marked the downfall of one of the highest-ranking women on Wall Street. More on Bloomberg here.

The Latest In Ponzi Schemes: Pretend You Know George Soros

admin — Tue, 15 May 2012 17:58:04 +0000

A woman in New Jersey allegedly scammed investors by telling them that George Soros (yes, that Soros) would be managing their assets. Prosecutors in Bergen County are pressing criminal charges against a woman who they say launched a Ponzi scheme in late 2005, and soliciting investors into a hedge fund that she claimed was handled by legendary hedge fund manager, George Soros. She collected about $450,000 from investors telling them that the hedge fund was allocating assets in the pharmaceutical sector. The woman, Dunya Predovan, apparently told the investors that she had worked for Soros in the 1980s. Read Forbes report here.

Bronx Tax Preparer Charged in $4.6 Million Ponzi Scheme

admin — Tue, 15 May 2012 17:56:16 +0000

A Bronx tax preparer was charged with 35 counts of fraud, money laundering, and grand larceny in a Ponzi scheme worth around $4.6 million. Robert H. “Bob” Van Zandt faces as many as 25 years in prison if he is convicted of all charges. Prosecutors said on Monday that several dozen New Yorkers were victimized in the scheme, according to New York Attorney General Eric Schneiderman’s office. “Money laundering and securities fraud are serious crimes, and when someone abuses the trust built upon longstanding relationships to steal individuals’ life savings, our office will prosecute that person to the fullest extent of the law,” Schneiderman said in a statement. Read the Epoch Times report here.

Ina Drew’s Successor at JPMorgan Has a Long History With Risk

admin — Tue, 15 May 2012 17:54:13 +0000

Matthew E. Zames, who will take over for Ina Drew as the chief investment officer of JPMorgan Chase in the wake of a $2 billion trading loss, has a long relationship with risk. Mr. Zames, who goes by Matt, is currently co-head of JPMorgan’s global fixed-income group and an executive in its mortgage division. He came to the bank in 2004 from Credit Suisse, where he was a trader in the interest rates group. His first job in finance, as a junior trader with the hedge fund Long-Term Capital Management, introduced him to the dangers of excessive risk-taking. Long-Term Capital Management, a hedge fund based in Greenwich, Conn., blew up after a series of risky arbitrage strategies led to billions of dollars in losses. The firm ultimately had to be bailed out in a $3.6 billion rescue coordinated by the Federal Reserve Bank of New York to avoid larger losses in the wider financial system. More in the New York Times here.