Category Archives: Regulations and regulators

Bill Black on Real News: BNP Paribas Fine Shows Financial Crime Still Pays

This Real News Network interview with Bill Black provides a good high-level overview of what is right and (mainly) wrong with the $8.9 billion settlement with BNP Paribas over money-laundering charges. Black stresses that financial crime remains a very attractive activity for both the enterprise and its employees. As usual, no executives were charged or even fined, although thanks to the intervention of New York financial services superintendent Benjamin Lawsky, eleven employees of the French bank lost their jobs.

SEC Investigating Group Purchasing Kickbacks by Private Equity Firms

You have to hand it to the private equity firm kingpins: they are skilled at financial sleight-of-hand which makes their already-lucrative investments even more attractive to them. But as the SEC has been exposing, too many of these tricks come at the expense of their investors.

The Wall Street Journal exposes the latest ruse tonight. While the dollar amounts aren’t earthshaking, the behavior is particularly shameless, and involves some of the biggest firms in the industry: KKR, Blackstone, and TPG. It shows that these firms are unafraid of engaging in out-and-out skimming as long as they dress it up in a way that is hard to ferret out.

Will the Eurozone Be Able to Align National Interests?

Yves here. We ran an earlier post by Ashoda Mody, he argued that Eurozone was failing in resolving its recurring crises successfully. That is a coded way of saying that the odds of breakup are rising. Needless to say, that view elicited a lot of commentary from his readers. Mody addresses their reactions and objection below.

Corporate Bond Trading a Casualty of QE and ZIRP

The Financial Times has an article on how corporate bond dealers are going to create a new trading hub to try to preserve their market position while “boosting liquidity” in the market. Narrowly speaking, there’s nothing wrong with the piece as a description of investor unhappiness and planned bank responses. But it curiously missed how Fed policy has helped generate conditions that are reducing corporate bond market liquidity.

Wolf Richter: Bank Regulator OCC Details Crazy Risk-Taking, Blames Fed

Yves here. Former Fed Chairman William McChesney Martin famously said that the job of the central bank was “to take away the punch bowl just as the party gets going.” That line of thinking went out of fashion under Alan Greenspan. Now we have the perverse spectacle of the most bank-cronyistic regulator, the Office of the Comptroller of the Currency, berating the Fed for spiking the punch via overly accommodative monetary policy.

Bill Black: Obama’s Latest Betrayal in Favor of the Big Banks: TISA

Yves here. I’ve taken the liberty of editing down Bill Black’s post slightly to bring readers more quickly to his correctly outraged discussion of the latest Wikileaks expose on a trade deal that has managed to go completely under the radar: the Trade in Services Agreement, otherwise known as TISA. We wrote about this troubling news when the story broke. Astonishingly, the mainstream media has taken no notice of this release. Black’s discussion is accessible to lay readers, and I hope you’ll circulate it in the interest of raising awareness of how the Administration intends to sell out the US to banks, Big Pharma, and other multinationals.

Black explains how TISA is designed to replicate, indeed, optimize the criminogenic environment that made fraudulent financial CEOs wealthy by “looting” “their” banks.

New York Times Snipes at Neil Barofsky Yet Again

I was naive enough to think that the New York Times’ vendetta against former SIGTARP prosecutor Neil Barofsky was limited to bank propagandist Andrew Ross Sorkin and Administration mouthpiece Jackie Calmes, who penned a particularly ham-handed hit piece on Barofsky’s book Bailout.

It turns out the depth of loyalty of reporters at the New York Times is much deeper than I imagined. Ben Protess and Jessica Silver-Greenberg work hard to snigger and finger-wag at Barofsky for being about to land a plum assignment that will again make him a big bank nemesis: that of serving as monitor to miscreant Credit Suisse.

Why a Carbon Tax is Better Than Obama’s Cap and Trade

This weekend, former Treasury secretary Hank Paulson weighed in at the New York Times abouyt the need for more urgent action on the climate front, and described how various indicators of how quickly climate change is taking place, such as the speed of Arctic and Antarctic ice melt, are moving much faster than models had predicted.

Paulson, who has long been an ardent conservationist (and in contrast to his alpha Wall Street male standing, lives modestly), made a forceful pitch for carbon taxes. The irony of this proposal is that we have a Republican showing what a right-winger Obama really is.

US to Fine BNP $8+ Billion, Suspend Access to Dollar Clearing

While it is refreshing to see the authorities man up a bit in dealing with a miscreant bank, it’s also critical to recognize that the US show of spine with BNP is all about the US tightening control over international payments. In other words, the harsh settlement is all about the US projecting its power overseas via financial services. It is not a precedent for how the authorities will deal with other types of bank

The Ugly Truth About Electronic Health Records

Why, at least in the US, electronic health records are all about the looting and as a result, a danger to your health.

More Finance, More Growth? More Finance, More Crises?

Contrary to conventional wisdom in economics, a bigger role for finance, also known as “financial deepening,” has gone well beyond the point of maximum return. It is promoting more crises rather than more growth.

Wikileaks Exposes Super Secret, Regulation-Gutting Financial Services Pact

The document that Wikileaks exposed on Thursday is a portion of the financial services section. It is clearly designed to serve the pet interests of big international players. This agreement is designed to institutionalize the current level of deregulation as a baseline and facilitate the introduction of new products, further ease the movement of funds, data, and key personnel, and facilitate cross-border acquisitions and other forms of market entry.

Repeated Foreclosures on an On-Time Borrower Demonstrate Failure to Fix Servicing and Fallacy of “Save Banks at All Costs” Policy

Repeated foreclosure attempts against an on-time borrower reveal why servicing remains hopelessly broken. That also means government guaranteed mortgages are here to stay.

New Zealand: The Shell Company Incorporation Franchises: Round-Up

In a series of recent posts on shell company incorporation scams, we reanalysed the New Zealand entities incorporated by GT Group (Ian Taylor), New Zealand Company Incorporators (Michael Taylor) and The Company Net (Glenn Smith). Curiously, some modest and uncontroversial reforms have yet to be enacted.