The trustee overseeing the liquidation of Bernie Madoff’s estate has asked a federal judge to order the owners of the Mets to turn over more than $83 million in allegedly fictitious profits they withdrew from their accounts in the two years before Madoff’s massive Ponzi scheme collapsed. In a motion for partial summary judgment filed late Thursday, the lawyers representing trustee Irving Picard — whose original claim demanded $1 billion from the Mets’ owners — said records show that Fred Wilpon, Saul Katz and their associates withdrew $83,309,162 in fictitious profits from 34 accounts between Dec. 11, 2006, and Dec. 11, 2008, when Madoff’s scam collapsed. More in the New York Daily News [...]
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Earlier this month, in a ninth-floor conference room of the Northern Trust bank in Chicago, an unlikely assembly of futures industry executives, regulators and customers discussed the fallout from MF Global’s collapse. The closed-door meeting illustrated a fundamental shift under way in the futures industry: financial firms, ordinarily loath to accept regulation, are now spearheading efforts for new oversight as they try to heal the black eye left by MF Global and the disappearance of $1.2 billion in its customers’ money. Read New York Times report [...] R. Allen Stanford, standing trial on allegations he led a $7 billion investment fraud, appeared in an October 2008 video shown to his jury decrying “damn greed” on Wall Street as the financial crisis deepened. “People are stupid, they’re greedy, they’re lazy, they don’t stick to their core values,” he told a gathering of Stanford Financial Group Co. executives in Miami. “We’re different.” More on Bloomberg here. [...] In 2009, federal investigators finally arrested Houston financier R. Allen Stanford. For twenty years, Stanford allegedly had run a $7 billion Ponzi scheme from his offshore bank on the Caribbean island of Antigua. U.S. authorities had been nosing around Stanford’s empire for longer than a decade but hesitated to open a full-blown probe. As Stanford’s trial began this week, one question left unanswered was: How did he keep authorities at bay for so long? A Reuters examination of his case finds that the answer lay in part in the legal advice he obtained from former SEC officials and other ex-regulators and law-enforcement officials. Read Reuters report [...] A federal judge’s ruling in a $1 billion lawsuit against the New York Mets owners has drawn 34 suits to the judge’s door that claim to be similar to the case brought by the liquidator of Bernard L. Madoff’s firm against Fred Wilpon and Saul Katz. U.S. District Judge Jed Rakoff in Manhattan threw out most of trustee Irving Picard’s claims against the team owners and refused to let Picard appeal his ruling before a March jury trial on $386 million in remaining claims. Rakoff has accepted as related some of the 34 cases against other defendants, while others await decisions, according to court records. Two new suits were added to the list yesterday. More in Bloomberg Businessweek [...] Three years after the demise of Lehman Brothers exposed problems in how brokers handle client funds, trading firms are still using lax rules to withhold cash owed to clients of failed brokerages, fuelling calls for reforms. Clients of MF Global UK, which filed for bankruptcy after revealing it had made a $6.3 billion bet on European sovereign debt, are struggling to get their money back from accounts where their investments have been pooled. Read Reuters report [...] A financial adviser who worked for former financier Allen Stanford testified at his trial on Wednesday that Stanford personally pressured her to bring in new clients for his bank. Michelle Chambliess, whose job was to get clients from Mexico and other countries in Latin America, recalled an incident in 2002 in which Stanford told her and a small group of her colleagues to get more clients by any means. Read Reuters report [...] U.S. Securities and Exchange Commission lawyers said U.S. District Judge Jed Rakoff erred in determining that courts must find its proposed settlements with companies to be “in the public interest” to win approval. Courts must only find the accords to be “fair, adequate and reasonable,” SEC attorney Andrea Wood told a federal judge in Wisconsin in a filing defending the agency’s proposed settlement with Milwaukee-based Koss Corp., a manufacturer of stereo headphones sued for allegedly making materially inaccurate financial statements for fiscal years 2005 through 2009. H. David Kotz has had an eventful four years watching the watchdog of Wall Street. Kotz, the Securities and Exchange Commission’s (SEC) inspector general, will leave his post at the end of January, closing out a tenure that spanned one of the most tumultuous eras in the agency’s history. He patrolled the SEC as it grappled with the financial crisis, a structural shakeup and the black eye of missing the Bernie Madoff Ponzi scheme. More on The Hill [...] A member of the House Financial Services Committee who has been prodding the Securities and Exchange Commission to beef up its cost-benefit analysis of a potential fiduciary-duty rule for investment advice seems inclined to run for chair of the panel in 2013 — if the GOP maintains control of the House. Rep. Scott Garrett, R-N.J., chairman of the Capital Markets Subcommittee, hasn’t made a decision on whether to put his name forward to House Republican leadership, according to a spokesman. But Mr. Garrett appears ready to make the case that he would be the best person for the job despite having less seniority than several other potential candidates. Read Investment News report [...] |
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