Tag Archives: Bernie Madoff

Stephen Chernin/Getty ImagesFinancier Bernard Madoff arrives at Manhattan Federal court in March 2009 for a sentencing hearing.

By Brett Wolf and Aruna Viswanatha

U.S. regulators plan to fault JPMorgan Chase, which served as Bernie Madoff‘s main bank for two decades, for failing to conduct adequate due diligence and report suspicious activity, according to a person familiar with the matter.

The Office of the Comptroller of the Currency is expected to issue a cease-and-desist order against JPMorgan, which will require the largest U.S. bank to put an end to the alleged failures in its anti-money laundering practices.

The timing of the order is uncertain but could come later this year, the source said. A fine isn’t expected. If the OCC isn’t satisfied with JPMorgan’s response, it can take harsher action against the bank, including financial penalties.

OCC spokesman Bryan Hubbard declined comment, as did JPMorgan spokeswoman Jennifer Zuccarelli.

Madoff was arrested in December 2008, pleaded guilty in 2009 to running a massive, decades-long Ponzi scheme, and is serving a 150-year prison sentence.

Irving Picard, a trustee for Madoff’s victims, has accused JPMorgan Chase & Co. (JPM) of ignoring warning signs that Madoff’s business was a fraud and has attempted to sue the bank. A judge has tossed out all but $425 million of Picard’s $19.9 billion lawsuit against JPMorgan. Picard is in the process of appealing the ruling.

JPMorgan has said there was no evidence showing that anyone at the bank knew of Madoff’s elaborate scheme. The bank did file a suspicious activity report in London two months before Madoff was arrested, describing his investment performance as “too good to be true,” according to Picard’s lawsuit.

The OCC will fault JPMorgan for treating Madoff and his related entities as low-risk customers, and find that the bank failed to heed red flags, such as funds being shuffled between accounts without clear business purpose, said the person familiar with the matter. As a result, “suspicious” transactions weren’t reported to authorities, said the source, who wasn’t authorized to speak publicly about the matter.

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The OCC in January ordered JPMorgan to tighten its risk controls and improve its anti-money laundering compliance. But the regulator separated that order from any action related to Madoff’s accounts, in a dispute with the bank over which documents it had to turn over as part of the inquiry.

The inspector general of the Treasury Department, which houses the OCC, has since ordered JPMorgan to work with regulators in the Madoff inquiry and rejected the bank’s argument that certain documents were protected by attorney-client privilege.

“The matter is still pending,” said Richard Delmar, counsel to the Treasury’s watchdog office.

JPMorgan has a recent history of tense relations with the OCC. A report released last month by a Senate investigative panel revealed

From: http://www.dailyfinance.com/2013/04/16/jpmorgan-bernie-madoff-scheme/

Business, Finance, Occupation & Industry

Dow Heads Higher Despite Disappointing Jobs Report

March 28, 2013 Bartle Doo Leave a comment

By John Maxfield, The Motley Fool

Filed under: Investing

Blue-chip stocks have regained their momentum today despite news that more Americans filed for unemployment benefits last week than economists had expected. With roughly an hour left in the trading session, the Dow Jones Industrial Average is up by 43 points, or 0.3%.

According to the Department of Labor, the number of applicants for jobless benefits increased by 16,000 last week compared to the previous week. The advance figure for the seven days ended March 23 was 357,000 — the highest level since mid-February and above the consensus forecast by 18,000 claims.

Analysts are nevertheless cautioning against reading too much into these figures, given the week-to-week volatility inherent in the estimate. As one analyst quoted by MarketWatch.com observed, “It would take more readings in this neighborhood to point to a modest pick in layoffs.” He went on to say that “the claims data continue to signal a slowing in the rate of job layoffs in the first quarter of 2013.”

In addition to this, new data from the Department of Commerce suggests that the economy expanded in the final three months of last year at a faster pace than originally estimated. In its first release of fourth-quarter GDP growth at the end of January, the government said the economy actually contracted by 0.1% due to dramatic cuts in military spending. This figure was revised upward last month to a positive 0.1%. And today, that figure was revised up once again to 0.4%.

As the official press release explained, “The GDP estimate released today is based on more complete source data than were available for the ‘second’ estimate issued last month.”

Despite the disappointing jobs figures, however, stocks are broadly higher as we enter the final hour of trading. At the time of writing, only nine of the Dow’s 30 component stocks are trading lower.

Leading the way higher are shares of United Technologies , the industrial conglomerate that makes everything from Otis elevators to Sikorsky helicopters. As my colleague Dan Carroll noted earlier, the company recently sold an electrical power systems unit that it had acquired from Goodrich. The deal was worth an estimated $400 million and “was the second divestment of a Goodrich unit since [United Technologies] purchased the company for more than $16 billion last year.”

Heading Dow shares lower, alternatively, is JPMorgan Chase , the nation’s largest bank by assets. Earlier today, The Wall Street Journal reported that a longtime JPMorgan veteran is leaving the company. The news comes on the heels of a string of troubles for the lending giant related to massive trading losses and even its purported role in the Bernie Madoff case.

With big finance firms still trading at deep discounts to their historical norms, investors everywhere are wondering if this is the new normal or if finance stocks are a screaming buy today. The answer depends on the company, so to help you figure out whether JPMorgan is …read more
Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Dow Jittery Ahead of Cypriot Banks Reopening

March 27, 2013 Bartle Doo Leave a comment

By Jeremy Bowman, The Motley Fool

Filed under: Investing

After opening the day down 100 points on concerns about Cyprus, the Dow Jones Industrial Average battled back to finish down just 33 points, or 0.2%. The S&P 500 and Nasdaq closed with even narrower margins.

Cypriot banks will open tomorrow for the first day since early last week, when they were closed as bailout negotiations began and depositors’ savings were put on the table. Investors fear a run on the banks could create a renewed sense of panic and hamper the bailout, which has promised to tax uninsured deposits. Eurozone finance ministers have also said that the Cyprus bailout could serve as a template for future financial rescues. Even as the banks reopen, withdrawals will be limited to 300 euros a day, checks will be forbidden, and there will be additional limits on credit card spending and taking money out of the country.

Only one relevant economic report came out today. February pending home sales surprisingly fell 0.4%, down from a 4.5% increase in January and below the 2% gain economists had expected. Still, the decline seemed to be a result of low housing inventories, which should lead to new construction, an overall positive for the housing market.

On the Dow today, JPMorgan Chase led the blue chips’ decline, falling 1.8% as the big bank again came under federal scrutiny. After hours yesterday, prosecutors revealed they were looking into whether JPMorgan had failed to properly alert authorities about Bernie Madoff‘s activities while he was carrying out his Ponzi scheme. JPMorgan’s failure to act could be in violation of a federal law requiring banks to report suspicious activities. After hours today, a judge ruled that the No. 1 bank by assets must face a lawsuit by a pension fund accusing it of mismanagement by investing the pension fund’s money in Lehman Brothers in the run-up to the financial crisis.

On the other end of the big board, UnitedHealth jumped 1.7% after congressional staffers said Medicare could raise payments to insurers, a potential reversal from the market‘s belief that payments would be lowered. Investors had expected a 2.2% payment cut in Medicare Advantage, but that would be negated if Congress blocks a 25% drop in doctors’ pay for next year.

Outside the Dow, J.C. Penney waved a white flag of sorts, ditching CEO Ron Johnson’s Everyday Low Prices model for its former discount-intensive strategy. Penney’s refusal to use markdowns had cost it many of its once-loyal customers as sales tumbled last year. Still, the Street shrugged at the move as shares finished down 0.7%.

With big finance firms still trading at deep discounts to their historic norms, investors everywhere are wondering if this is the new normal or whether finance stocks are a screaming buy today. The answer depends on the company, so to help figure out whether JPMorgan is a buy today, I invite you to read our premium research report on the company today. Click …read more
Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

JPMorgan Drags on the Dow

March 27, 2013 Bartle Doo Leave a comment

By Dan Carroll, The Motley Fool

Filed under: Investing

The Dow Jones Industrial Average has been anything but consistent this week, dropping back into the red today after yesterday’s gains. As of 2:15 p.m. EDT, the blue-chip index has shed 40 points, or 0.3%, with most member stocks in negative territory. Investors are still jittery over the proceedings in Europe, but there’s a lot more than Cyprus going on in the market. Let’s catch up on the movers you need to know about today.

JPMorgan under siege
It’s been a tough day for JPMorgan shareholders. The bank stock has fallen 1.9% to lead the Dow lower as pressure rises from Washington and other prosecutors regarding the company’s recent missteps. Some prosecutors are looking into whether or not the bank violated laws by insufficiently alerting authorities to Bernie Madoff‘s fraudulent scheme, which was revealed in 2008. Eight federal agencies are investigating the bank, including the FDIC and the SEC. Investors should rightly be worried about whether or not the federal bull’s-eye on the bank will threaten its future, although it’s impossible to say with certainty what will happen to JPMorgan until definitive data emerges from these investigations.

Merck is also on the downswing today, with shares down 0.8% to rank among the worst Dow laggards. The company’s facing ongoing pushback from parents and other groups across America over its HPV vaccine Gardasil. While the drug has sold well (more than $1.6 billion last year), HPV vaccination rates for children remain far behind other well-known and recommended vaccines, such as the Tdap shot for tetanus, diphtheria, and pertussis. Merck could use a boost, as patent expirations — particularly on bestseller Singulair — have hit the company’ s revenue. If public sentiment turns in Gardasil’s favor, Merck could face a sales bonanza.

Not all stocks are down today despite the Dow’s dip, however. UnitedHealth Group leads the index higher, with shares up 1.8%. Investors welcomed news that the Medicare program could raise its payments to insurers. That’s an extra layer of insurance for UnitedHealth as it enters a post-Obamacare world. While it’s hard to predict exactly how health care reform will impact the company, the new law‘s restrictions on denying patients with pre-existing conditions, among other changes to national health-care legislation, will force UnitedHealth to adapt to an influx of new customers.

Finally, Microsoft shares also rose by a more modest 0.7% today after reports emerged that telecom company Ericsson is considering acquiring the former’s mobile TV service. Microsoft is interested in the sale so it can focus more on its Xbox streaming service as it promotes its gaming console as a centerpiece of home entertainment.

News, Politics, Government

Knox case puts Italian justice under scrutiny

March 27, 2013 Bartle Doo Leave a comment

When crooked American financier Bernie Madoff was sentenced in New York, the leading Italian newspaper Corriere della Sera published a front-page cartoon mocking Italy‘s trial system.

On one side was a U.S. courtroom, where a judge was handing down a 150-year sentence after a six-month trial. On the other, an Italian courtroom with a judge handing down a six-month sentence after a 150-year trial.

That’s how the country’s No. 1 newspaper summed up Italy‘s slow-moving, and at times inconclusive, justice system.

The decision by Italy‘s highest criminal appeals court to overturn the acquittals of American student Amanda Knox and her former Italian boyfriend, and order a new trial in the 2007 slaying of her British roommate, is once again raising concerns both at home and abroad about how justice works in Italy.

It’s a system where people cleared of serious crimes can have the threat of prison hanging over them for years, while powerful politicians such as former premier Silvio Berlusconi can avoid jail sentences almost indefinitely by filing appeal after appeal until the statute of limitations runs out.

“Lots of confusion and contradictions,” said restaurant chef Angelo Boccanero, giving his impression of the Knox case as he sipped his morning espresso.

And it’s not just the criminal courts that raise eyebrows.

The back log on civil cases is so severe that it hampers desperately sought foreign investment to Italy. Divorces can take years to process, meaning that couples who’ve had enough remain legally tied. And forget about getting quick compensation in a fraudulent property deal — it can take ages (if ever) before you’ll see any money.

Successive governments have pledged to streamline proceedings but have so far failed to do so. That’s largely because powerful people in politics, business and the judiciary have repeatedly fended off reform to protect their interests and the people close to them.

One criticism of the system is Italy‘s high number of lawyers. Milan, for example, has more attorneys than all of France. In civil cases, it takes an average of seven years to reach a verdict.

Defenders say that Italy‘s legal system is one of the world’s most “garantista” — or protective of civil liberties. Defendants are guaranteed three …read more
Source: FULL ARTICLE at Fox World News

Articles of Interest

Paul Krugman: Alan Simpson Benefiting From Madoff-Like ‘Affinity Fraud’

February 21, 2013 Bartle Doo Leave a comment

By The Huffington Post News Editors

Ask Paul Krugman, and he’ll tell you a former senator has a few things in common with one of the biggest con men in history.

The Pulitzer Prize-winning economist wrote in a blog post Thursday that like major Ponzi schemer Bernie Madoff, former Senator Alan Simpson is benefitting from “affinity fraud” — a dynamic where people ignore evidence indicating someone is obviously wrong because they view them as “their kind of guy.” Simpson and former White House Chief of Staff Erskine Bowles make up the deficit fighting duo President Obama tasked in 2010 with coming up with a plan to reduce the nation’s debt and they recently released the latest version of their proposal.

“Simpson is, demonstrably, grossly ignorant on precisely the subjects on which he is treated as a guru, not understanding the finances of Social Security, the truth about life expectancy, and much more,” Krugman wrote. “Yet he remains not only respectable among the Beltway crowd; as Ezra [Klein] says, he’s lionized in a way that looks from the outside like a clear violation of journalistic norms.”

Rare, legitimate Madoff investment, a biopharmaceutical company, goes public

February 2, 2013 Bartle Doo Leave a comment

Jailed Wall Street fraudster Bernie Madoff may have finally picked a legitimate winner.

A biopharmaceutical company partly owned by the Madoff family had an initial public offering Tuesday that sold $33 million worth of stock.

The New York Post reports that Madoff’s initial $2.2 million investment in the company, Stemline Therapeutics, is now worth $5.5 million on paper.

But the scammer might not be able to keep the money.

The trustee overseeing efforts to untangle Madoff’s Ponzi scheme says the family’s shares rightfully belong to his defrauded clients.

He has filed a lawsuit seeking to seize those shares on behalf of fraud victims.

Madoff is expected to spend the rest of his life in prison.

Source: FULL ARTICLE at Fox US News

Bartle Doo Article Archives

Tag Archives: Bernie Madoff

U.S. Regulator to Fault JPMorgan Over Madoff Accounts

Dow Heads Higher Despite Disappointing Jobs Report

Dow Jittery Ahead of Cypriot Banks Reopening

JPMorgan Drags on the Dow

Knox case puts Italian justice under scrutiny

Rare, legitimate Madoff investment, a biopharmaceutical company, goes public

Articles Archive