Let’s give it a shot! Ponzi Boy’s lawyer, Ira Sorkin, asked a three-judge panel of the 2nd U.S. Circuit Court of Appeals this morning to send Madoff home, because Judge Denny Chin “made a legal error” last week when he remanded Berns to Manhattan’s Correctional Center ’til the June 16th sentencing. Here’s hoping Sorkin went for broke and told himself, “if we’re gonna do this, let’s really do this,” and asked for vacay privileges to the house in Palm Beach, and to “…drop the pesky ankle monitoring bracelet. You can trust this guy.”
Archive for March 2009
So! Yesterday a bunch of jackhole Congressmen demanded, every hour on the hour (step aside, they’ve got a quota to meet) that Ed Liddy hand over the names of the AIG employees receiving bonuses. Because the firm has received many death threats, including one by decapitation, on the lives of its staff and their children, Liddy said that he would comply but only with the assurance the names weren’t leaked to the press, which you’d think would be a reasonable request but No! No! Fuck that, gives us the names now, we’re not going to agree to shit! a bunch of elected officials shouted back. (Barney Frank noted that he receives death threats like that all the time, quit yer bitching.) Anywho, Liddy held his ground but this morning the WSJ has a name. Only it’s of an AIG exec who’s giving his bonus back. And that doesn’t make for a very good witch hunt, now does it?
Most people here are well-aware that we have a soft spot for Tickle a Vickle Pandit, the CEO whose jolly elfin visage once had the power to do wonders for the bank’s shares. But I don’t even think we can help him get him out of this one.* Bloomberg reports that Citi will spend about $10 million on new offices for Pandito and his lieutenants. Here’s the TARP-taking firm’s explanation for why this isn’t a big deal:
“Senior executives in our corporate headquarters are moving from two floors to smaller, simpler offices on a single floor…Based on estimates made when the project was initiated, we expect to generate savings in the next few years well in excess of the project costs.”
Meanwhile, we have it on good authority Charlie Gasparino is tapping his Citi sources in the hopes someone will leak the itemized list of new furniture coming Vik’s way, including a $500,000 commode, except in this case it actually will be a toilet, and not a fancy cabinet.
*Though maybe this is an attempt to convince people Citi will be profitable at some point between now and fifty years from now, and that this is therefor an insignificant expense? Or Prince, like O’Neal, had decorated his office in the style of Studio 54, and Pandit deemed it uninhabitable?
See those buttery leather chairs up there? Though they once expected, and probably looked forward to, housing Vikram Pandit’s ass, that’s apparently never gonna happen (at least not on his employer’s dime). The official word has come down from French planemaker Dassault Aviation that Citi has actually canceled its order for three Falcon 7X jets. We knew this day would come but being told to brace ourselves for impact has done little to minimize the pain. In January, the Big C put out a statement that it had “no plans to take possession (after people found out they that’s exactly what the bank was going to do), but we didn’t really believe it because this is exactly the sort of thing they’d lie about, and because we assumed someone would wake up and realize Vikram and his crew need to fly in style. (Obviously this notion was taken into consideration, since Citi didn’t actually cancel the flight ’til last month.) RBS has also canceled its order of a Falcon 7X business jet worth $40-45 million, which is disappointing.
Rambo Fed To Buy As Much As Needed (Bloomberg)
“By committing to buy Treasuries and double his purchases of mortgage debt, Federal Reserve Chairman Ben S. Bernanke signaled his determination to avoid a repeat of the Great Depression and his willingness to pump as much cash into the economy as needed to end the current crisis.
U.S. central bankers decided yesterday to buy as much as $300 billion of long-term Treasuries and more than double mortgage-debt purchases to $1.45 trillion, aiming to lower home- loan and other interest rates. The Fed kept its main rate at almost zero and may keep it there for an “extended” time.”
Citi, MS Eye More Shares For Staff Pay (Reuters)
It looks like both companies are going to have to go to shareholders to ask for approval in some form, which in this climate is proving to be a dangerous task.
“Citigroup Inc and Morgan Stanley will in the next few weeks announce plans to authorize or repurpose shares so they can have enough stock to compensate employees, the Wall Street Journal said, citing people familiar with the matter.
The need to add or free up stock has been exacerbated by plunging share prices, the paper said.”
CNBC: How Rich Are Cocaine Cartels (CNBC)
“Over the past days, TBM has made an effort to get to the bottom of Forbes’ number. The magazine does give you some back of the envelope calculations. According to Forbes’ Guzman blurb, “Mexican and Colombian drug traffickers brought in $18 billion to $39 billion in wholesale cocaine shipments to the US last year. Guzman’s organization took in, by Forbes’ estimate, 20 percent of that-which makes for $3.6 billion to $7.8 billion in revenues. That’s a good start. But then Forbes punts saying simply that’s “enough for him to have pocketed $1 billion over the course of his career and earn a spot on the billionaire’s list for the first time.”"
Naked Shorts Hint Fraud In Lehman Downfall (Bloomberg)
“As Lehman Brothers Holdings Inc. struggled to survive last year, as many as 32.8 million shares in the company were sold and not delivered to buyers on time as of Sept. 11, according to data compiled by the Securities and Exchange Commission and Bloomberg. That was a more than 57-fold increase over the prior year’s peak of 567,518 failed trades on July 30.
The SEC has linked such so-called fails-to-deliver to naked short selling, a strategy that can be used to manipulate markets. A fail-to-deliver is a trade that doesn’t settle within three days.”
Dodd to give back AIG contributions (CT Post)
Yep.
$$$ Dissecting the A.I.G. Bonus Contract [Dealbook]
$$$ The Layoff Game [The Deal]
$$$ Apparently there’s going to be a protest at GS tomorrow. [TBTE]
$$$ Piedrahita‘s checkered past [GofaG]
$$$ Level the Field, a non-profit that seeks to develop partnerships between collegiate athletic programs and middle schools in order to create a mentoring program for adolescent students in low-income communities, will be hosting an open bar fundraiser at 1Oak on April 16. Purchase tickets here today and help touch the lives of approximately 80 sixth graders in the fall and many more in the future.
Apparently the Treasury made him do it.
New York has decided to out the Merrill Bonus traitors. Release the hounds!
New York Attorney State Supreme Court Justice Bernard Fried in Manhattan today rejected an argument by Charlotte, North Carolina-based Bank of America Corp. that compensation information was a trade secret. He also said employees can have no reasonable expectation of privacy in the information when they are free to share it.
“The Martin Act vests in the Attorney General the discretion to decide whether to keep the information that he gathers in the course of his investigation secret or public,” Fried wrote in a 16-page decision, referring to a New York securities law. Bank of America, he said, has no “privacy interest that undermines that statutory discretion.”
Judge Says Cuomo May Name Merrill Bonus Recipients [Bloomberg]
Related: Full text of the ruling via WSJ.
Mail-call: “Linda Thomsen having a going away party at the SEC right now.”
The AIG Bonus Scandal “Is A Stone In America’s Shoe, And Making It Hard To Walk Our Journey”
By Bess Levin[Earlier]
4:51PM: Rep. David. Scott: “We’ve got to get that stone out of our shoe.” Oh, yes, we’re back.
Scott: “Mr. Liddy, we are in effect at war….Our economy is *almost* in the tank.”
One more Congressman should ask Liddy what he was thinking when he drafted those contracts.* Go on, do it. It no longer makes us want to kill someone, ’cause we’ve turned it into a drinking game.
*Which he, you know, since he’s been forced to say it 838 times today, didn’t.
5:01PM: Rest assured: AIG = dumb, not criminal (according to Lids, there’s no cooking of books at AIG, just “too big an appetite for risk…it’s not like an Enron or a WorldCom”).
5:04PM: Rep. Maloney: Why didn’t you disclose your counterparties? What were you hiding? Why? Why did you do it?
Liddy: Because the Federal Reserve has a policy of not disclosing that information, and wouldn’t let us.
Maloney, eye lit up, practically kvelling: REAL-LY? Was there anything else you wanted to disclose but were prohibited from doing so?
Liddy (nervous, sees where she’s going with this*): Uhmmm…not that I know of (don’t hurt me, crazy lady).
*The place where she strings Bernanke up by his balls.
5:35PM: Rep. Donnelly: In terms of credit default swaps, how much have they cost AIG?
Liddy: 50 billion…ish?
[CSPAN flashes the definition of a credit default swap, probably for the benefit of Congress]
6:00PM: Some Rep whose name I missed is interested to hear how 20 to 25 people were able to bring AIG “to the brink and threaten the entire financial system.” Liddy tells him he ought to bring in those people (Cassano, for starters), and ask them. No argument there.
The Most Surprising Thing About This Story Is That Congress Did Not Make The Same Mistake
By Bess Levin
Pity the middle-aged fool who happens to have a somewhat round, slightly doughy looking face though no other discernable physical similarities to AIG CEO Edward Liddy.
[Zippy] Duvall, president of the Georgia Farm Bureau, was minding his own business this morning as he walked down a corridor of the Rayburn House Office Building outside the hearing room where a committee was probing the AIG bonuses. Suddenly, he was surrounded by lights, television cameras and microphones.
“Are you ready for this hearing?” somebody shouted.
“Do you think they’re going to treat you fairly?”
Duvall stopped to chat amiably with the mob of reporters. “If I knew I was going to get all this attention, I’d have gotten my hair cut,” said the farm bureau president, who is almost completely bald.
As the questions continued to fly, one of Duvall’s farm-bureau colleagues shared a thought with his suddenly-popular boss: “I think they think you’re somebody else.”
It was of course, a case of mistaken identity. Duvall, as it happens, bears not even a passing resemblance to AIG Chairman Edward Liddy. If the lack of Liddy’s white hair didn’t give it away, surely the peanut-print tie and the farm-bureau lapel pin should have. “We’re here to represent farmers,” Duvall explained as the questioners began to disperse.
The AIG Hearing’s First Victim [WaPo via Gawker]
