This week’s arrival of a ramped-up European regulatory regime is set to make derivatives trading more costly for exchanges and their customers, though it isn’t clear by how much, the chief of the London Metal Exchange’s under-construction clearing group said. “There’s a price to be paid for extra regulation,” Trevor Spanner, an LME managing director and architect of LME Clear, told Dow Jones Newswires. Read Fox Business News report [...]
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R. Allen Stanford’s Antiguan- appointed liquidators agreed to stop seeking control of the convicted financier’s assets in a deal that may allow defrauded investors to recover some of the $300 million Stanford stashed in accounts outside the U.S. Receivers appointed by the U.S. and the Antiguan courts have battled for four years to control assets recovered from Stanford’s financial-services empire. Stanford, 62, was convicted last March of leading a $7 billion investment fraud based on bogus certificates of deposit at his Antigua-based bank. He was sentenced to 110 years in prison. “The funds that are the subject of this agreement represent the largest available source of investor money that Allen Stanford had not already spent by the time his Ponzi scheme collapsed,” Kevin Sadler, lead attorney for U.S. receiver Ralph Janvey, said in an e-mail today. “In the absence of this agreement, these funds would remain out of reach of the Stanford victims for years to come.” More on Bloomberg [...] New York Attorney General Eric Schneiderman is set to ask a federal judge today for permission to complete a $410 million settlement with J. Ezra Merkin, using his law enforcement powers to compensate the former Bernard Madoff investor’s victims. Madoff brokerage liquidator Irving Picard, who seeks to collect $500 million from Merkin for different investors, is trying to block the deal. Schneiderman has argued that Picard has no claim to the settlement money and lacks power as a bankruptcy trustee to stop the state from enforcing the people’s legal rights. More on Bloomberg [...] Any resistance to the confirmation of Mary Jo White as head of the Securities and Exchange Commission is not likely to follow the usual script, with Republicans trying to land a devastating blow as Democrats work to protect the White House nominee. In fact, when White appears before a Senate committee for her confirmation hearing on Tuesday, some of the tougher questions are expected to come from Democrats concerned about her close ties to Wall Street. Given her distinguishedlegal career defending some of Wall Street’s biggest names, Democrats want assurances that these relationships won’t interfere with White’s resolve or ability to effectively police corporate America. Read Washington Post report [...] Money manager Ezra Merkin has been hit with a new lawsuit over his secretly steering client money to Ponzi schemer Bernard Madoff. Keren Matana, an Israeli charity, sued to recover $1.5 million it lost by investing in the Ascot Fund, an offshore hedge fund managed by Merkin that fed money to Madoff. The charity is also seeking $5 million in punitive damages. Merkin agreed last year to a settlement of $405 million for investors in his hedge funds whose assets went to Madoff, ending a lawsuit brought by the New York attorney general’s office. More on Reuters [...] Commodity futures and options were the only derivatives that saw growth in trading volumes last year, the World Federation of Exchanges said, amid what analysts said was a weak U.S. market after the MF Global and Peregrine broking scandals. The number of commodity derivatives traded across the world rose by around 19 percent for a second straight year in 2012, reaching 3,265 contracts in all from 2,749 in 2011, the Paris-based WEF said in a statement issued on Thursday. In comparison, interest rates instruments registered a 15 percent decline in derivatives volume; securities for equities showed a fall of more than 15 percent and currency derivatives marked a drop of over 22 percent. And for the first time since 2004, the number of exchange- traded derivatives worldwide decreased 15 percent to a total of around 21 billion. More on Reuters [...] An attorney for a former aide to Bernard Madoff urged the 2nd U.S. Circuit Court of Appeals on Thursday to give his client a chance to access funds the government has seized so that he can pay for his legal defense. Prosecutors seized about $3.9 million in assets belonging to Daniel Bonventre, 66, the former operations manager at Madoff’s firm, in January 2011. They argue the assets are tainted by Madoff’s Ponzi scheme. Bonventre’s attorney, Andrew Frisch, said Thursday he has not taken fees from Bonventre since prosecutors warned him in a December 2010 letter not to draw on his defense fund because it might be subject to forfeiture if Bonventre is convicted. Former U.S. District Judge Barbara Jones in Manhattan had denied Bonventre’s motion to vacate the government’s seizure warrants. Frisch argued to a three-judge appeals court panel that his client is entitled to a hearing in the lower court over the matter. More on Reuters [...] MF Global Holdings Ltd. (MFGLQ) bankruptcy trustee Louis Freeh struck a deal with J.P. Morgan Chase & Co. (JPM) in their dispute over more than $900 million in intercompany claims, removing one of the key roadblocks to the holding company’s Chapter 11 liquidation plan. Under the settlement, some $275 million of the more than $1.8 billion that MF Global’s holding company says a company finance subsidiary owes it will be subordinated, that is ranked below the $1.2 billion owed to a lending group led by J.P. Morgan. “The settlement is in the best interest of creditors (as) it removes a major hurdle to confirmation of the plan,” said Mr. Freeh in a statement Tuesday. More on Fox Business News [...] New York Attorney General Eric Schneiderman accused Bernie Madoff trustee Irving Picard of twiddling his thumbs while Schneiderman was busy recovering $410 million for victims of the convicted Ponzi schemer. “The Trustee sat back watching while the NYAG developed a case,” Schneiderman said in court papers. “But he waited too long. He should now have to live with the consequences of his strategy.” Schneiderman is fighting Picard’s efforts to block a $410 million settlement the AG brokered with fallen hedge-fund honcho Ezra Merkin, who acted as one of the biggest Madoff “feeder” funds. More in the New York Post [...] State securities regulators on Tuesday urged Congress to investigate the practice of using powerful computers to trade rapidly large volumes of securities. The practice, known as high-frequency trading (HFT), can put retail investors at a disadvantage since they generally do not have access to the same information and often buy and sell at less favorable prices, according to the North American Securities Administrators Association (NASAA). NASAA, a Washington-based organization of state securities regulators, made its appeal during a news conference at the National Press Club in the U.S. capital. More on Reuters [...] |
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