Stanford sought to influence regulator

Allen Stanford, charged with a $7 billion Ponzi scheme, sought to have a Antiguan regulator with oversight of his offshore bank dismissed after she rejected a number of the Texas financier’s overtures to work together, she testified on Monday. Prosecutors say Stanford bilked investors in more than 100 countries through the sale of fraudulent certificates of deposit from his offshore bank in Antigua. Read Reuters report [...]

MF Global CFO To S&P Before Collapse: We’ve ‘Never Been Stronger’

Just a week before futures brokerage MF Global filed for bankruptcy, the firm’s chief financial officer told analysts at Standard & Poor’s that its capital position had “never been stronger,” according to the ratings agency. The behind-the-scenes details about MF Global’s dealings with McGraw Hill’s Standard & Poor’s came in a Jan. 17 letter from the rating agency’s managing director Craig Parmelee to lawmakers investigating the role that ratings agencies and risk officers played in the collapse of MF Global. More on Reuters [...]

House Subcommittee to Point Blame at Federal Agencies Over MF Global Collapse

A House subcommittee investigating the demise of the brokerage firm MF Global plans to issue a report on its inquiry that will likely criticize two federal agencies for failing to communicate key information about the firm’s risk-taking activities just months before its implosion and subsequent bankruptcy filing in November, the FOX Business Network has learned. The House Financial Services subcommittee on investigations will hold its second hearing this Thursday, which will include testimony from MF Global’s risk officers. Committee members plan to focus on statements the firm’s senior executives made to rating agency officials just before the firm imploded over investor fears surrounding its exposure to risky sovereign debt. See Fox Business report [...]

The Madoff Trustee Wants To Demand $19 Billion From JPMorgan In A 17,500 Word Appeal

Irving Picard, the trustee charged with unwinding the Bernie Madoff estate in the wake of the ponzi schemer’s bankruptcy, is seeking permission to file a 17,500 word complaint in order to be able to demand $19 billion in damages from JPMorgan Chase, Bloomberg reported this morning. JPMorgan was Madoff’s primary banker, and Picard alleges that losses could have been avoided if the bank had picked up on Madoff’s fraud. As the Madoff trustee, Picard is in charge of making former investors whole, and has made similar claims against many other banks in order to do so. Read Business Insider report [...]

Madoff case: U.S. asks court to OK $7.2 billion Picower deal

The U.S. asked a federal appeals court to affirm a $7.2 billion forfeiture by the Jeffry Picower estate, to be used to compensate investors who lost money in Bernard Madoff’s Ponzi scheme. A challenge by Adele Fox was “frivolous,” and it wouldn’t serve justice to let her intervene in a deal that “in no way impairs Fox’s rights,” the U.S. said in a court filing in New York. Fox, a former Madoff investor, sought to overturn the settlement because it gave Madoff trustee Irving Picard priority in dealing with the Picower estate, and barred her from suing the estate herself. More in the Sun Sentinel [...]

One Stanford Client Lost $20 Million, Ex-Executive Tells Jurors at Trial

A former Stanford Group Co. executive told a jury that one client of R. Allen Stanford’s securities brokerage lost at least $20 million before the business was closed by U.S. regulators. Jason Green, who led Stanford Group’s private-client group, offered the figure while being cross-examined by the defense on the fifth day of Stanford’s investor fraud trial in federal court in Houston. Read Bloomberg report [...]

SEC Commissioners Said to Seek Larger Role in Choosing Next Watchdog

U.S. Securities and Exchange Commission Chairman Mary Schapiro may have to revise a proposal for hiring the agency’s next internal watchdog after at least three commissioners demanded greater say in the process, according to two people familiar with the matter. Commissioners were recently presented the plan in which panels of senior SEC staff would rate, interview and suggest final candidates to succeed H. David Kotz, according to the people, who asked not to be named because the plans weren’t public. Read Bloomberg report [...]

Exiting watchdog sees flaws in SEC’s rulewriting

In his final act before departing the U.S. Securities and Exchange Commission on Friday, the agency’s inspector general, David Kotz, criticized how the agency analyzes the economic impact of some of its Dodd-Frank rules. Kotz’s criticism, contained in a report, could have ramifications for the SEC, which has lost several court battles over the years because of flaws in how it demonstrates that the benefits of a rule outweigh its costs. More on Reuters [...]

SEC taps new interim inspector general to replace Kotz

The Securities and Exchange Commission has appointed Deputy Inspector General Noelle Maloney as interim inspector general to temporarily replace David Kotz, who is leaving the SEC for a job with a private investigative firm. Maloney will head the inspector general’s office while the agency searches for a replacement, the SEC said. Read more on Reuters [...]

Expert Witnesses Faulted in Suit Against Mets’ Owners

Lawyers for the victims of Bernard L. Madoff have accused the Mets’ owners of enriching themselves with illegitimate profits from his Ponzi scheme. The owners, in turn, have called the lawyers shakedown artists bent on ruining their good reputations to extort money. It has, then, been a mean year all around since the Madoff trustee sued Fred Wilpon and Saul Katz, the Mets’ owners, for $1 billion. Read New York Times report here. [...]