Category Archives: Banking regulation

Bezos Asked Michael Bloomberg To Run

What Arrogance!

Jeff Bezos asked Michael Bloomberg to run for President in February. According to Vox:

bezos asked bloomberg to run in februarySometime after Amazon pulled the plug on plans for a New York City headquarters in February of this year, the city’s former mayor Mike Bloomberg received a call from a top company executive.

It wasn’t just any Amazon executive — it was Jeff Bezos, the company’s founder and CEO and the world’s richest man.

Bezos was calling with a question for his fellow billionaire and media mogul: Would Bloomberg consider entering the 2020 presidential race?

Bloomberg told Bezos no at the time, according to a person briefed on the phone conversation.

But he had a question of his own for Amazon’s CEO: Would Bezos reconsider his decision to cancel plans for an Amazon headquarters — dubbed HQ2 — in New York City? Bezos’s response matched Bloomberg’s — he wouldn’t.

Now Michael  Bloomberg is running. As a Democrat. This is a perfect example of why voters are so cynical about politics. The Rich feel they’re entitled to buy control of the country if necessary. Bloomberg will self-fund his campaign, which puts all other  Democratic candidates at a huge disadvantage.

His rationale for running is that Joe Biden’s campaign was struggling financially. Instead of putting his money behind Biden, the Mayor’s over-blown sense of self says the country needs him. We don’t.

Like Trump, Michael Bloomberg IS Wall Street

Michael Bloomberg, though a champion for certain Democratic causes, is no Democrat. His views on women and minorities are enough in themselves to reject him. Then there’s his defense of Wall Street’s business as usual. In September, Bloomberg Magazine boohooed the mere $23 million Goldman Sachs Chief Executive Officer David Solomon was paid last year. It seems his predecessor earned three times that much in 2007. In fact, they report:

Investment bankers had their pay reduced by about a third, with a mid-level banker now getting $600,000 to $950,000, Bell said. Compensation for managing directors has fallen roughly 30%, to an average of $1.5 million to $2 million.

Awww… at the same time the article states, and I quote, “…pay was never as significant for the [bank] branch staff, [You know- the “little people”] but it’s been holding up too, rising along with average wages.”

As Slate’s Matt put it:

When the question is gigantic sodas, Bloomberg sees exploited marks and decides to rescue them from themselves. But when the question is financial products, Bloomberg sides with the con artists and says the marks are only suffering because they’re not smart enough.

Michael Bloomberg’s entry into the Democratic race could blow everything up. If voters have to choose between two oversized egos, they may just keep the one we’ve got. Bernie voters probably won’t vote at all, making Bloomberg the spoiler, as he admitted.

The Mayor’s autocratic, my-way-or-the-highway, style, coupled with his disdain for women and minorities should make his candidacy a non-starter. Democrats need to stand up to this attempted hijacking of our primary.

WILL THEY?

Clipart-Of-A-Red-Rose

 

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Filed under 2020 Election, Banking regulation, Elections, Michael Bloomberg, Politics

Corporate Criminals 5/21/2015

Corporate Criminals

 

This edition of Corporate Criminals begins with some players who’ve already been in trouble plenty of times, which leads to the question: Why aren’t Boards and shareholders throwing them out on their asses? Headlines via Corporate Crime Reporter. Here we go again:

Five Major Banks to Plead Guilty

Five major banks – Citicorp, JPMorgan Chase & Co., Barclays PLC, The Royal Bank of Scotland plc and UBS AG – will plead guilty to felony charges.

Citicorp, JPMorgan Chase & Co., Barclays PLC, and The Royal Bank of Scotland plc will plead guilty to conspiring to manipulate the price of U.S. dollars and euros exchanged in the foreign currency exchange (FX) spot market and the banks have agreed to pay criminal fines totaling more than $2.5 billion.

UBS AG will plead guilty to manipulating the London Interbank Offered Rate (LIBOR) and other benchmark interest rates and pay a $203 million criminal penalty, after breaching its December 2012 non-prosecution agreement resolving the LIBOR investigation.

In conjunction with previously announced settlements with regulatory agencies in the United States and abroad, including the Office of the Comptroller of the Currency (OCC) and the Swiss Financial Market Supervisory Authority (FINMA), today’s resolutions bring the total fines and penalties paid by these five banks for their conduct in the FX spot market to nearly $9 billion.

Gosh, who couldn’t have anticipated this happening? In their post, JPMorgan Chase: Corporate Rap Sheet, the Corporate Research Project calls the company: “… a prime symbol of financial sector misconduct and reckless behavior…”; personally, I doubt there’s anything reckless about their dealings. I think JPMorgan Chase has decided they will keep doing business as usual as long as they’re only punished with measly fines. And they are measly, all things considered. Two things have to start happening with big bank crime:

  1. People Have To Start Going To Jail
  2. No Part of Any Fines Paid Should Ever Be Tax Deductible

Duke Energy Apologizes for Environmental Crimes, Will Pay $102 Million

Three subsidiaries of North Carolina-based Duke Energy Corporation, the largest utility in the United States, pled guilty to nine criminal violations of the Clean Water Act at several of its North Carolina facilities.

The company and will pay a $68 million criminal fine and spend $34 million on environmental projects and land conservation to benefit rivers and wetlands in North Carolina and Virginia.

But hey, they apologized, right?

The Consumer Financial Protection Bureau (CFPB) filed a complaint and proposed consent order in federal court against PayPal, Inc. for illegally signing up consumers for its online credit product, PayPal Credit, formerly known as Bill Me Later.

The CFPB alleges that PayPal deceptively advertised promotional benefits that it failed to honor, signed consumers up for credit without their permission, made them use PayPal Credit instead of their preferred payment method, and then mishandled billing disputes.

 

martha stewart

 

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Filed under Banking regulation, Big Banks, Corporate Crime

Corporate Crime Report For 2/4/15

Corporate Criminals

Corporate Crime Headlines From Corporate Crime Reporter:

FCC to Fine AT&T $640,000: The Federal Communications Commission intends to fine AT&T Inc. $640,000 for allegedly operating numerous wireless stations throughout the United States without authorization over a multi-year period and failing to provide required license modification notices to the FCC.

FinCEN Fines Oppenheimer $20 Million: The Financial Crimes Enforcement Network (FinCEN) assessed a $20 million civil money penalty against Oppenheimer & Co., Inc., for willfully violating the Bank Secrecy Act (BSA).

Oppenheimer, a securities broker-dealer in New York, admitted that it failed to establish and implement an adequate anti-money laundering program, failed to conduct adequate due diligence on a foreign correspondent account, and failed to comply with requirements under Section 311 of the USA PATRIOT Act.

FinCEN and the New York Stock Exchange assessed a civil money penalty of $2.8 million against Oppenheimer in 2005 for similar violations.
In 2013, the Financial Industry Regulatory Authority fined the firm $1.4 million for violations of securities laws and anti-money laundering failures.

Community Health Systems Hospitals to Pay $75 Million to Settle False Claims Act Charge: Community Health Systems Professional Services Corporation (CHSPSC) and three affiliated New Mexico hospitals (CHS) will pay the United States $75 million to settle allegations that they violated the False Claims Act by making illegal donations to county governments which were used to fund the state share of Medicaid payments to the hospitals.

CHSPSC is based in Franklin, Tennessee, and manages more than 200 affiliated hospitals in 29 states.

“Congress expressly intended that states and counties use their own money when seeking federal matching funds in order to encourage them to join the federal government in ensuring that Medicaid funds are spent on the needs of beneficiaries,” said Justice Department Civil Division chief Joyce R. Branda. “When private hospitals violate the rules against hospital donations funding the state share, that important protection of the Medicaid program is destroyed.”

Standard & Poor’s Financial Services and its parent McGraw Hill Financial Inc. will pay $1.375 billion: to settle charges S&P engaged in a scheme to defraud investors in structured financial products known as Residential Mortgage-Backed Securities (RMBS) and Collateralized Debt Obligations (CDOs).

The agreement resolves the department’s 2013 lawsuit against S&P, along with the suits of 19 states and the District of Columbia.

 

martha

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Filed under Banking regulation, Big Banks, Corporate Crime, Corporate Greed

Jamie Dimon: Too Darned Many Regulators!

Jamie Dimon Thinks Banks Have Too Many Regulators to Deal With

In a conference call with reporters last week, JPMorgan CEO, Jamie Dimon, complained that there are too many regulators watching the big banks:

Jamie Dimon crybaby“In the old days, you dealt with one regulator when you had an issue, maybe two. Now it’s five or six. It makes it very difficult and very complicated. You all should ask the question about how American that is. …how fair that is, …how complex that is for companies.”

Well, “in the old days” there weren’t as many creative ways to rip Americans off, something Jamie Dimon’s bank has turned into an art.

Why JPMorgan Chase Needs So Many Regulators

Barry Ritholtz, of The Big Picture, has a rundown of JP Morgan’s most recent fines. These stem from such things as foreclosure abuses, electricity market and currency manipulation, illegal credit card practices, and misleading investors:

Since 2011, JPM has been fined $8B:

$56 million (April 2011)give a man a bank
$153.6 million (June 2011)
$229 Million (July 2011)
$88.3 Million (August 2011)
$5.29 Billion (February 2012)
$110 million (February 2012)
$150 million (March 2012)
$296.9 million (November 2012)
X% of $8.5 billion (January 2013)
$100 million (March 2013)
$410 million FERC settlement (August 2013)
$900 million (September 19, 2013)

Nooo, they don’t need no stinkin’ regulators. Dimon is lucky the Justice Department isn’t camped out in his office. Despite blatant financial crimes like those of JPMorgan Chase, Republicans still rail against regulations.

Republicans Would Rather Scale Back Consumer Protections

Rather than reigning in corporate malfeasance, Republicans have aimed their sights at the Consumer Financial Protection Bureau. The CFPB was established after the banking meltdown to protect consumers from predatory businesses like Mr. Dimon’s. Here are a few ways CFPB has helped Americans since it was formed, courtesy of Americans for Financial Reform:

The CFPB has successfully required credit card companies to return $1.5 billion dollars to the consumers they ripped off with deceptive and fraudulent add on products, and reined in the practices that led to those abusive sales

Beginning in 2012, the CFPB has brought enforcement actions against Bank of America, American Express subsidiaries, Chase Bank, and Capitol One, resulting in more than $1.5 billion paid back to over 10 million consumers…

The CFPB has written rules to end mortgage loans that borrowers can’t afford to repay, and has limited high fees and abusive payment structures

The CFPB’s new mortgage rules require that lenders verify borrowers’ ability to repay before making a home loan, and cordon off the kinds of high fees and deceptively-structured mortgages that were a central cause of the mortgage and financial crisis…

The CFPB is standing up for borrowers and families struggling with student loans

In March 2014, the CFPB took its first public enforcement action against a company in the for-profit college industry, filing a lawsuit against ITT Educational Services, Inc. for engaging in predatory student lending practices that the agency argues are pushing students into high-cost private student loans that inevitably will default. In December 2013 the agency issued a ruling allowing it to supervise certain nonbank student loan servicers for the first time, bringing federal oversight to the nation’s second largest debt market…

CFPB data collection and analysis has exhaustively documented serious abuses in the payday lending market

The CFPB reports on payday lending, which examined more extensive data than had ever been available before to anyone outside the industry, vividly demonstrated how frequently payday loans trap borrowers in debt. The studies found that the median loan issued was for $350, with an APR of 322 percent…

The CFPB is shutting down ‘last dollar’ scams that charge up-front fees for help that does not get delivered

‘Last dollar’ scams include deceptive mortgage servicing schemes, abusive debt collection tactics, and other bogus offers related to credit repair services and debt relief promises…

Republican Majority Seen As “Friends in Congress” to Big Business

With a Republican majority in the House and Senate, or as business entities have put it: Friends in Congress, you can expect Republicans to thwart the efforts of the CFPB wherever possible. In the meantime, Jamie Dimon has a Congress full of sympathetic ears to tell his regulatory woes to. Don’t think for a minute that  JPMorgan Chase has or will change its business practices. According to a 2014 report in the New York Times:

“The fines have been manageable in the context of the bank’s earnings capacity,” Jason Goldberg, a bank analyst at Barclays, said. “It makes $25 billion in revenue per quarter and has record capital.”

… JPMorgan … has steadily set aside reserves over the last few years to finance future legal payouts.

No mention of any planning ahead when it comes to doing business with integrity.

cross-posted@ All Things Democrat

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Filed under Banking regulation, Congress, Corporate Crime, Politics