In a victory for federal regulators, an administrative judge has found three former executives who worked for Allen Stanford’s now-defunct brokerage liable for fraud and said they should banned from the industry. The ruling comes more than a year after Stanford was sentenced to 110 years in prison for bilking investors through a Ponzi scheme with fraudulent certificates of deposit issued by Stanford International Bank, his bank in Antigua. In her ruling, Securities and Exchange Commission Judge Carol Fox Foelak described as “egregious” the conduct of former Stanford Group Co. chief compliance officer Bernerd Young, former president Daniel Bogar and Jason Green, a former head of the private client group. More on Reuters [...]
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Former FBI chief Louis Freeh, the state-appointed trustee in the MF Global bankruptcy case, has asked to be paid another $1 million for winding down the failed brokerage. Freeh already asked for nearly $2 million in fees, but agreed to a slight reduction after the Department of Justice criticized him and his law firm for vague time records. The trustee listed the negotiation with MF Global’s UK subsidiary that resulted in the return of $30 million to the company among the services rendered by him and his team. More on Reuters [...] Oppenheimer Holdings Inc. (OPY) will pay $1.4 million to settle a brokerage industry regulator’s claims that it had an inadequate anti-money laundering program and failed to detect and report suspicious penny stock transactions. The company’s brokerage unit failed to identify as “red flags” sales of more than 1 billion shares of 20 low-priced, highly speculative unregistered securities from August 2008 to September 2010, the Financial Industry Regulatory Authority said in a statement today. The firm also failed to conduct adequate due diligence on a correspondent account of a broker in the Bahamas, Finra said. More on Bloomberg [...] On June 18, 2013, recently appointed Securities and Exchange Commission Chair Mary Jo White released something of a bombshell, announcing that the agency would break from its long-standing practice of allowing defendants to settle cases without admitting liability and, in certain cases, require admissions as a condition of settlement.1 According to various reports, the new approach was set out in an email to the Enforcement Division staff on June 17, 2013, explaining that, while neither-admit-nor-deny settlements would remain the standard practice, admissions would be required in “certain cases where heightened accountability or acceptance of responsibility through the defendant’s admission of misconduct may be appropriate, even if it does not allow us to achieve a prompt resolution.”2 While the exact parameters of when admissions will be required were not laid out, Enforcement Division Co-Directors Andrew Ceresney and George Canellos said admissions might be required in cases of “egregious intentional misconduct,” where the defendant had obstructed the investigation, or where the conduct “harmed large numbers of investors.” More on Bloomberg [...] ROCKVILLE, Md. — Cameron Funkhouser heads a spy agency that most Americans never knew existed. His operation is based in a nondescript beige building in the leafy suburbs outside Washington, a short drive from the National Security Agency, the CIA and the FBI. Inside, dozens of analysts pore over a torrent of sophisticated data that has become a front line in an aggressive government battle. Red flags pop up on their computers when something seems amiss, then investigators get to work tracking down leads. The most promising targets are identified in high-level meetings inside what the organization calls its war room. This isn’t a hunt for terrorists. They’re snooping for Wall Street cheats: insider traders acting on hot — and illegal — stock tips. More in the Los Angeles Times [...] An affiliate of MF Global Holdings Ltd. filed a lawsuit alleging 11 banks engaged in anticompetive practices in the $25 trillion credit-default swaps market, including preventing the company from becoming a clearing broker for swaps. MF Global Capital LLC, an arm of the collapsed broker managed by a board liquidating the company, filed a lawsuit in U.S. District Court for the Northern District of Illinois late Thursday alleging the banks “restrained competition” in the lucrative CDS market. MF Global’s move is the third lawsuit filed in the U.S. claiming banks controlled the swaps market inappropriately. It is also the latest sign that companies who say they were hamstrung by banks dominating the market are growing into a credible threat for Wall Street firms still reeling from litigation on everything from mortgage bonds to manipulation of a key interest rate benchmark, Libor, or the London Interbank Offered Rate. More in the Wall Street Journal [...] Woody Allen’s “Blue Jasmine” packed New York and Los Angeles theaters after Cate Blanchett scored glowing reviews for her role as the wife of a Bernie Madoff-like swindler. The movie, which opened in six theaters this past weekend, took in $612,000, researcher Hollywood.com Box-Office said today in an e-mailed statement. The film averaged $102,000 per screen, leading the weekend’s other new releases on that basis. “Blue Jasmine” will rival “Midnight in Paris” as Allen’s top-grossing film, according to Michael Barker, co-president and co-founder of Sony Pictures Classics, which distributed both movies. This coming weekend “Blue Jasmine” expands to 50 cities, including Washington and San Francisco, the setting for much of the film, he said. More on Bloomberg [...] |
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