Archive for January 2009

  • 14 Jan 2009 at 11:03 AM

Severance Watch ’09: Barclays

By Bess Levin

Picture 580.pngEmployees being shown the door this morning at BarcLehs, specifically Barclays Capital, are apparently being sent on their way with three months severance, no bonus (this figure was supposedly for analyst level). At this time we remind you that the ID badge belonging to laid off Lehman Brothers staffer Bella was auctioned off last year for $810, benefiting canines. If anyone happens to come across the tags* of, for instance, Dick Fuld, Joe Gregory, Erin Callan, etc, we would be more than happy to flip them for what we’re sure would be bank, and send the money to former BarcLettes in need.
Update: We’re told a recently promoted equities VP received 4 months + bonus.
*Discarded JO&C tissues, etc. Anything, really.

  • 14 Jan 2009 at 10:56 AM

It’s Just Not Fair

By Equity Private

I mean the story had everything. General aviation. Infidelity. Financial fraud. (Allegedly). Interstate flight. Suicide. (Attempted). (Allegedly). Divorce. More financial fraud. (Allegedly). The FBI. Southern law enforcement. The U.S. Marshals Service. Camping. Insurance fraud. (Allegedly). Shameless self promotion. Photographs representing the absolute pinnacle of douchebaggery. MILFs. (Your mileage may vary). Equities in Dallas. (Indianapolis). Civil suits. Bankruptcy. Bankruptcy fraud. (Allegedly). And what’s more? It was so sordid, in fact, that our friends over at Clusterstock didn’t even write about it once! But we know what you love. Don’t we?
This story was made for Dealbreaker. Accordingly, I would like to take a moment to say: fuck you. Fuck you Marcus for blowing it so quickly. We even gave you a guide to sustain you in your time of trouble, for crying out loud.
*Sigh*
Ok, ok. Story so far:
In 1990 Schrenker does 16 days on a stolen property theft charge, apparently gets probation and has the record expunged. (Well, sort of expunged anyhow).
In 1991 Schrenker faces a forced Chapter 7 liquidation petition, claims it was filed fraudulently and blames his fraternity brothers for taking cards out in his name.
In 2001 he was terminated from Multi Financial Securities (churning was the allegation).
In 2003 he faces IRS allegations that he failed to report income and purchased “$29,000 in audio/visual equipment and orders $16,000 worth of landscaping services, provided to his home” that he seemed to be claiming as business expenses.
In 2003 he again faces a Chapter 7 liquidation action, again claiming the action was fraudulently filed. (Forged signature). Sounds familiar.

Continue reading »

  • 14 Jan 2009 at 10:27 AM

Bernie: Bail Or Bubba?

By Bess Levin

Another day, another opportunity to debate amongst ourselves whether or not Bernie Madoff will have his bail revoked. If you feel like we’ve had this conversation 875 times, it’s because we have. This afternoon, a hearing is scheduled to appeal Judge Ronald L. Ellis decision that the Ponz. master be allowed to remain in the comfort of his home at 133 East 64th Street. On Monday Ellis said he could but only with obscenely stringent restrictions, like mail checks, apartment sweeps (every couple weeks, natch), and no transferring of assets. Should we be stocking up on soap attached to a rope for Big B’s stay downtown or will he most likely get off, once again?

  • 14 Jan 2009 at 9:20 AM

Crab-Hands Official Sued For Insider Trading

By Bess Levin

Picture 577.pngDow Jones reports the SEC has sued Ramesh Chakrapani, a managing director at Blackstone, for insider trading involving Albertsons, a chain of supermarkets, scoring over $3.6 million in not necessarily legal gains.

Continue reading »

  • 14 Jan 2009 at 8:00 AM

Opening Bell: 01.14.09

By William Richards

Deutsche Bank Reports $6.3B Loss (Bloomberg)
“The fourth-quarter loss reflects “exceptional market conditions, which severely impacted results in the sales and trading businesses, most notably in credit trading including its proprietary trading business, equity derivatives and equities proprietary trading,” the bank said in the statement.”
Translation: Deutsche Bank got their collective asses handed to them – but the bitch of quarter is still Citi at $10B down.
HSBC Holdings Needs $30B, Condom, And Lube (MarketWatch)
Morgan Stanley is bearish on the European giant, estimating they need to raise between $20B and $30B on top of a dividend cut in order to meet a capital shortfall.
“The “world’s local bank” has 57% of its loan book in the U.S. and the U.K., making it highly exposed to the credit cycle.”
UBS Broker Declared Fugitive (CNBC)
Raoul Weil, the UBS broker so beloved by American citizens and IRS auditors has failed to surrender himself to U.S. Authorities on Tuesday. Weil, you’ll remember, was the UBS point-man in the attempt to help more than 17,000 people keep their money from confiscation by the US. In a way, I feel sorry for the guy: given all the recent atrocities in the financial markets his little tax fraud scheme is minor, but (as the government does) they’re going to come at him with the hammer of God because failing to do so would cause public scorn.
Chrysler Might Be For Sale, After All (Reuters)
Contradicting the position statement ran a couple of days ago, it looks like Chrysler might be positioning for a sell off:
“Struggling U.S. automaker Chrysler is in talks to sell assets to Renault-Nissan and parts supplier Magna, sources with knowledge of the discussions have told Reuters, though the French automaker Wednesday denied such talks were under way.”
Man Group Assets Fall 21%; Shares Decline In London (Bloomberg)
“Man Group Plc, the largest publicly traded hedge-fund manager, said assets under management fell 21 percent in the last three months of 2008, more than expected, as it wrote down two funds linked to Bernard Madoff.
Man Group dropped as much as 11 percent in London trading after the firm said in a statement that assets under management were $53.3 billion as of Dec. 31, down from $67.6 billion at the end of September and $61 billion at the beginning of November. The firm had been forecast to report about $55.6 billion of assets under management, according to analysts at UBS AG.”

  • 13 Jan 2009 at 11:53 PM

Dealbreaker Afterdark: The Flight Finally Looks Over

By Equity Private

The Indiana pilot who faked a distress call and bailed out of a plane over Alabama, slashed his wrist before being taken into custody at a campground outside of Chattahoochee, Fla.
Advertisement
Marcus Schrenker, 38, was discovered in a tent around 8:30 p.m. EST at the campground, said Dominic Guadagnoli, a spokesman for the U.S. Marshal’s Office.
Schrenker “lost a great deal of blood from a deep cut to one of his wrists,” said a news release from the U.S. Marshal’s service.

Missing pilot captured [PNJ.com]
Those of you who voted 6-12 hours… win!

  • 13 Jan 2009 at 5:42 PM

Write-Offs: 01.13.09

By Bess Levin

$$$ What Madoff could learn from Ponzi [Fortune]
$$$ The Fall of the House of Weill [DB]
$$$ CEO Firings on the Rise [WSJ]

  • 13 Jan 2009 at 5:28 PM

Morgan Stanley Smith Barney: “Check Out How Much Money We’ll Save When We Fire An Asston Of Employees”

By Bess Levin

Picture 576.png

Continue reading »

  • 13 Jan 2009 at 4:53 PM

“Industry Leading Wealth Management Business”

By Bess Levin

CNBC reports, Morgan Stanley Smith Barney is official. 51% to Morgan, 49% to Citi, 20,000 advisers, after-tax gain of approximately $5.8B, $2.7B in upfront cash for the junkies. Full press release after the jump.

Continue reading »

  • 13 Jan 2009 at 3:16 PM

Ponzi Signs

By Equity Private

Yes, it’s true, we called “Ponzi” on the early Schrenker news mostly tongue-in-cheek, but there were hints and now… the signs are all there.
Consider:
1. Targeted a specific group and demographic with existing trust structures (pilots):

“It was all word of mouth, and when you’re a pilot, you trust. That’s what you do and what you’re used to doing,” said Joe Mazzone, 57, of Auburn, Alabama. “His modus operandi is, he flies into your city dressed up in a $1,000 suit and sits down with you, buys you lunch, and the next thing you know, he has you on his side, and you move your money to his Heritage Wealth Management.”

[Note: Heritage Wealth Management, Inc., Schrenker's firm should not be confused with Heritage Wealth Management, LLC, the apparently unconnected San Diego firm]
2. Highlighted charisma over facts:

“This guy was the most charming guy you’ll ever meet,” said Kinney, who allowed Schrenker to manage his money starting about 2003. Kinney then encouraged his parents to invest about $2 million with Schrenker.
“This guy was family to me,” Kinney told CNN. “He’s a fantastic nice guy. He’s well-spoken. His customer service was impeccable. You call the guy on the phone, you would get him.

3. Was vague about strategies and provided limited methodology descriptions:

“He told my parents that they were investing in various insurance products, but they didn’t really know what that meant. I didn’t really know, either. We trusted him,” Kinney continued. “He said this is a safe place to put money, to avoid all the world’s dangers like terrorism and impending doom and gloom associated with it.

4. Used unusual fee structures:

Both pilots say Schrenker gave them vague explanations about where their money was invested. Kinney and Mazzone said Schrenker assured them that he was not making commissions on their investments and that the pilots and their families would receive only one statement each year showing returns.

The signs are all there.
Warrant issued for missing pilot [CNN]

  • 13 Jan 2009 at 2:53 PM

To Say Nothing Of The Underage Houseboys He’s Got Living Over The Garage

By Bess Levin

Picture 575.png

SAN FRANCISCO (MarketWatch) — Sen. Charles Grassley, R-Iowa, is raising concerns over President-elect Barack Obama’s pick for Treasury secretary, The Wall Street Journal reported Tuesday on its Web site. Grassley is questioning the immigration status of a housekeeper who worked for Timothy Geithner and whether Geithner paid Social Security and Medicare taxes over several years, according to the Journal.