As previously mentioned, I had dinner last night with, among others, Charlie Gasparino. We dined at Campagnola, which was CG’s pick, natch, as he has been going there for years, and the owners have a lax policy on unlicensed firearms and underage drinking. Before CG got there (he was taping Kudlow, who disappointingly did not join us), we did a little investigative reporting with the other regulars. Some blonde British lady who goes way back with CG very excitedly told us about the time a few years ago when Chaz had an altercation at Campagnola with Lance Armstrong. Apparently One Ball had appeared on CNBC earlier that day to discuss his sponsorship of a mutual fund and Charlie brought up the matter of doping rumors, which did not please Lance, and there was a bit of an on air tiff.

Coincidentally they both ended up at the restaurant that night, and friend insisted on introducing Chaz to OB, who pointed his finger in Gaspo’s face and said, “You’re an asshole.” At first Charlie was (suspiciously) apologetic and told Lance how great he was “on the tube” and what an ace guest he was at handling CG’s tough line of questioning. But Lance was having none of it, and continued to insist that no, Charlie was an asshole, that everyone on CNBC is an idiot and that he’d never do the show again. Charlie then told OB that he was sure CNBC could get someone else to come on his place and to have “a shitty fucking dinner.”

We were also regaled, by Sal the maitre d’, with a story about Chaz coming in for a drink a couple weeks after BSC went down for the dirt nap, and having a table full of Bear guys get up in his grill and make claims he was a two-bit reporter. Things got “openly hostile.” Gasps told them “I feel bad if you lost your job but I was just doing my job.” They continued tell CG how much he sucked, to which he finally responded, “Any time, anywhere, I don’t care how many of you there are.” Boom. Done.

I couldn’t recall this morning what Gaspo had ordered but was reminded by another member of our party that he got an app of baked clams and shrimp, then half a chicken (which he put ketchup on), steamed spinach, and at least 7 [Update: Charlie tells me it was more like 10] martinis. I do recall that before our entrees came Chaz made a point to alert me that he hadn’t touched any of the sopressat’ on the table, though I suspect he had them wrap it up (plus whatever was left in the kitchen) for him to take home and tear into later. The famous “Eddie,” who runs a family-owned chain of gay strip clubs, wasn’t able to attend but toward the end of dinner a guy purporting to be Charlie’s brother joined us (they looked nothing alike so I requested to see his driver’s license, which did in fact bear the Gaspo name, though I remain not entirely convinced). CG tipped $100 on a pretax bill of $350, and at one point got very serious and insisted I report back that he has “a fetish for flossing and gargling,” then whipped out a case of floss and a travel sized bottle of Scope to prove it. We then went to Elaine’s where one guy at the table passed out and fell off his chair, which Charlie maintains he had nothing to do with. Here are the answers to your questions I was allowed to print (a decent number of them I was barred from sharing, unless I had an interest in ending up in a body bag).

Do you use moisturizer on your hands or face?
Never.

What do you think of David Faber’s book?
I haven’t read it yet. I’m too busy penning the definitive book on this crisis.

Is Jeff Macke writing the forward to your book?
No, there’s no forward. I get right into it.

When are you going to dye your hair, which is going gray? Up top and below deck.
The hairs on my head, never. As for downtown, tell whoever asked that, oo gatz, like my mother used to say.

What kind of cologne do you wear?
Addidas sport set at the gym, Old Spice on the job, Drakkar Noir for special occasions.

Steven Rubinstein probably figured in a world where Allen Stanford is pleading his innocence and Bernie is gunning for 12 years behind bars for the largest Ponzi scheme in history, his sentence for one count of filing a false tax return will make a slap on the wrist look like vicious corporal punishment.The government claims the UBS private banking client (and Florida yacht industry accountant) utilized his offshore accounts for 8 years to pull off $7 million on-shore transfers tax free as well as wheeling and dealing in Krugerrand gold coins. For these indiscretions and his seven years worth of failing to file FBAR disclosures to the IRS, Rubinstein picked today, the day of Sir Allen’s proclaimed innocence, to reverse his original not guilty plea and take his chances with sentencing for his single count of tax fraud.

Florida Man Pleads Guilty in UBS Tax Case [NYT]

When we informed you that Ben Lorello, UBS global head of health care, had left the bank to join Jefferies and taken a gaggle of employees with him, we figured the Swiss might be a tad upset about the ship jumping. Apparently they’re getting more bent out of shape than previously anticipated. Bloomberg reports* the tax specialists are suing Jefferies for what they describe as a “massive, premeditated raid” that resulted in 36 members of the healthcare group peacing out. Obviously everyone’s very upset and emotions and feelings of betrayal are running but I think, perhaps, the jilted women ought to take a second and realize that, eventually, they were going to have to fire at least 36 (thousand) more employees anyway. This way, they got rid of the bodies without looking like the bad guy, and didn’t even have to pay severance. So, really, Lorello did them a favor.

*Bloomberg should also be given credit for only needing two reporters to break the news of Lorello’s departure nine days after it happened and had already been written about.

Which is presumably why the bank (allegedly) offered female ex-Merrill Lynch brokers lower retention bonuses than their male counterparts, which the girls have taken issue with, and filed suit over today. On the bright side, and I think this is the point Ken Lewis should stress, it means not every last cent of taxpayer money was being blown on getting employees to stick it out.

Now’s your chance! Today we offer you two avenues for getting in front of the camera. A) Shoot an email to Dennis Kneale, who is looking for volunteers to jello-wrestle him on the floor of the NYSE for a very special episode of Power Lunch (DK will provide you with a onesie, he’ll be dressed as a chicken) and B) this:

MTV’s award-winning documentary series True Life is producing an episode entitled “I’m a Gambler.” This project will feature three young people who love to gamble - whether their passion is sports betting, casino tables or wagering on the stock market. The intent of the show is to get an inside look into the exciting and unique world of an avid gambler.

We’re currently seeking a young person who day trades with their own money in order to get by. This person needs to have a lot invested in to their wagers, be it because they recently lost their job or that they are severely in debt. Our goal is to find someone with a dynamic personality who can give us an inside look at the highs and lows of gambling on the stock market every day.

Please note, the person needs to be under 26 years of age. Applicants who also gamble on sports or table games are especially encouraged to apply.

This episode of True Life will be produced for MTV through Gigantic! Productions. At Gigantic!, we’ve received multiple accolades for our programming including 2 Prism Awards, 2 GLADD Awards and our episode of ‘True Life: I’m Deaf’ was recently nominated for an Emmy Award. We’ve also produced several other episodes of True Life including ‘True Life: I’m Going to Fashion Week’, ‘I’m Moving to New York’ and ‘I’m Going to Fat Camp’.

If you’re interested in this project, please send a biography along with a current picture of yourself to casting@gigantic.tv.

If you’ve been looking to get in early on a new growth industry or simply take a vacation that you truly will never forget, pack your bags and head to the Gulf of Aden. For £3,500/ day you can tag along on a Russian yacht that actively seeks out Somali pirates. Another £12 will get you an AK-47 and 100 rounds of ammo to deliver the message that the joke is on them in a more personal manner.

Luxury yachts offer pirate hunting cruises [Anova]

Workers in Citi’s Japanese retail business may be getting an unexpected holiday courtesy of local regulators. But this is nothing new- they know the drill.

Japan to order Citi suspend some business [Reuters]

I’ll be bringing you the entirety of Charlie Gasparino’s answers to your questions this shortly. To tide you over ‘til then, there’s brief footage of the meal after the jump, and, in response to the query, “Is his right wrist bigger/more muscular than his left, as a result of repetitive jacking,” CG said this: “They’re the same size, because it takes two hands. You need a firm grip. Write that down.”

There used to be a time when SPVs were nice packaging plants for credit card securitizations and the issuer didn’t think have to think twice about the underlying risk. Now the loss rates are getting high enough to scare a few issuers into buying the junior pieces of their own deals to avoid losing their regular customers to some other cheap drug. The image of banks scrambling around to prevent credit card deals from hitting early redemption coverage triggers must have been on Herb Allison’s mind when he was talking about declining credit market risk.

Banks come to the aid of card securitisation vehicles [FT]

Vis-a-vis fraud charges (suggestions so the contrary will result in a punch to the mouth). As for allegations that he’s a maverick rich Texan who puts moose heads on the wall and drops weights at the gym in order to get people’s attention? Guilty as charged.

Earlier: You’re F’ing Right I’m Gonna Fight

[via Gawker]
Oooo, remember that story from the Post a few months back claiming Dylan Ratigan had gone off on his producer in the middle of Fast Money, and was maybe going to get fired for doing so? The audio is now available.

Shredding evidence? Sneaking contraband to the husb? No and no. Something so much worse.

Based on the recent trend of slipping systemically critical labels under the front doors of financial institutions as easily as take out menus, the US is setting the stage for the era of average banking. The regulatory overlords seem hell-bent on establishing a landscape of average size banks making average size profits. However, as little as DC wants to hear it, there is still a convincing argument for bigger is better. Just because the Sandy Weil/Chuck Prince experiment failed in spectacular fashion, with special help from Bob Rubin, that shouldn’t condemn firms like JPM to live with Washington’s acumen in determining the proper size and shape for a bank.

The Perils of a Smaller Wall Street [WSJ]

10:05 According to prepared a statement from the Beard, the Fed acted with “the highest integrity,” he never told BAC management that action (like firing Lewis/killing him) would be taken if the MAC was invoked, and you bitches got nothing.

10:08 Rep. Edolphus Towns is getting kinky with his opening remarks. “It’s time to lift the shroud of secrecy on the Fed and stick a flashlight where the sun don’t shine.”

10:12 Rep Issa wants to give Bernanke “a full and complete opportunity” to prove he’s not a criminal. Issa is in desperate need of a better speech writer. I’m not going to be volunteering my services, as my loyalties lie with B-nanke, but perhaps some slithering virus might like the job.

10:15 Bernanke looks confident, as do the the 16 year olds behind him. Paulson was allegedly going to show up today but he’s not seated at the table, meaning it’s possible he’s going to make a surprise entrance halfway through to fuck some Congressional asses up.

10:22 Mic trubs. Can you hear me now? Now? How’s that? Can you hear me? (The kids behind Beard find the technical difficulties hilarious, as does Towns.)

10:26 Everything under control, prepared remarks being read. Blondie w/ Bangs is totally bored, can barely stifle yawns. Perhaps she’d be more entertained if B-nankes opened with this: “You have a particular grace and calm that I adore. You have a level of sophistication that is so fitting with your beauty. I could digress and say that you have the ability to give magnificently gentle kisses, or that I love your tan lines or that I love the curves of your hips, the erotic beauty of you holding yourself (or two magnificent parts of yourself) in the faded glow of night’s light — but hey, that would be going into the sexual details we spoke of at the steakhouse at dinner — and unlike you I would never do that!”

10:30 Confidential to the minor next to Blondie: are you daring to a) close your eyes b) smirk to your pal stage left? All while the Fed chair is talking?

10:33 Is kid a few rows behind Blondie is attempting to come off reflective by tapping fingers on pursed lips? Or seduce Kucinich?

10:36 Bernanke promised Lewis no specific amount to complete deal, though he did dangle a case of Boone’s on a stick in front of K to the L’s face while mouthing “you want it? come and get it.”

10:39 WHAT IS HAPPENING ON THE RIGHT SIDE OF THE ROOM? Has Bald entered the hizzous??

10:41 When Issa, who, in our professional opinion is getting way ahead of himself and is set to shoot his load with hours to go, told Bernanke he could make his point “briefly,” should Beard have gone with the Danza slap, clown face, or other?

10:47 Yes, Beard and his boys have asked Bank of America to reexamine its board and possibly make changes, and yes, if we’re going to be superficial, Kucinich is at the back of the pack when it comes to League Tables: How Hot Is The Congressional Staffer Sitting Behind You, though perhaps the guy does some good stuff with his tongue.

10:50 Rep whose name I missed is trying to spice this thing up. “Is Mr. Lewis lying? Did he lie? Is he lying?” Pipsqueak next to Blondie likes this.

10:53 While “I’m sure I can’t remember” is a good response to “Are you sure you can’t remember?” B-squared probably should’ve gone with “Kiss my ass and suck my dick… everyone” and walked out of the room.

10:59 Rep Jim Jordan is taking us back, way back, to the day in October Paulson rounded up all the CEOs in a room and suggested he’d put caps in all their asses if the TARP money wasn’t accepted. Apparently this is to establish a history of intimidation, in which case, why stop there? It’s common knowledge Hank cut his teeth the summer between high school and college working as a bike cop, and would regularly wear shorts cut loosely enough that he could dangle his Paulsons in people’s faces in such a way that implied, “Do not even entertain the thought of fucking with my shit.”

11:05 Tiger print, possibly a gal pal of Dick Fuld, doesn’t get why Lehmans (both of them) was allowed to fail.

Yessss. First instance of “I’m not a [insert profession here],” a longstanding tradition of Congressional Hearings. There’s a 10-spot in it for Beard if he mixes it up today with “I’m not a Brazilian waxer,” “I’m not an irrigation specialist,” “I’m not a publicly elected sucker of cock,” etc.

11:09 Bernanke doesn’t give a rat’s ass about the SEC and he’s got no regrets, when it comes to the BAC deal or anything in life [turns around to lady behind him, “Only that I didn’t take you to Argentina when I had the chance, sweet cheeks.”]

11:20 Rep. ‘Stache knows Lewis is the bad guy, not Bernanke. But he’s going on gut instinct, and needs some cold hard facts. Evidence. Damning pictures of Lewis passed out in the men’s room of a biker bar in Charlotte.

Former IBM CEO Lou Gerstner is not making any new friends on trading desks. Gerstner bemoans Wall St.’s focus on short term trading rewards but goes one step further and offers a modest proposal to solve the problem. In his utopia, day traders would pay an 80% tax on gains, individuals holding investments for 6 months would pay a paltry 60%, and for those willing to hold on for 5 years, you’d pay nothing (presumably to match the gain).

Gerstner Says Short-Term Gains Should Be Taxed at 80% [Bloomberg]

Related: “It’s You, You Big Fat Toad, YOU!”

Fed Emails Bash BofA Chief In Tussle Over Merrill Deal (WSJ)
Earlier that day, Mr. Bernanke had weighed in on the threat to pull out of the Merrill deal: “I think the threat to use the MAC is a bargaining chip, and we do not see it as a very likely scenario at all,” he wrote in a Dec. 21 email to a selection of Fed governors.

He also urged preparations be made “so that we can explain to [Bank of America] with some confidence why we think it would be a foolish move and why regulators will not condone it.”

New TARP Chief: Economy on Mend, But Vigilance Needed (Reuters)
“I’m confident that very soon we’ll be launching [public-private] partnerships,” Allison said. “Some time between now and 100 years from now.”

AIG To Repay Debt Through IPOs (WSJ)
$25 billion down, $25 trillion to go.

Cuomo Recused Himself Over Money Manager in Pension Fund Probe (Bloomberg)
A paragon of virtue and ethics!

AQR hedging its bets with big mutual fund plan (Reuters)
“We don’t want to be theoretical academics. We want to be the guys who demystify alternative (investments) and tell people what’s under the wizard’s hat,” co-founder David Kabiller said.

Read e-mails between Sanford, woman (The State)
“Since our first meeting there in a wind swept somewhat open air dance spot in Punta del Este, I felt that you had that same rare attribute. Above all else I love that inner beauty about you…You have a particular grace and calm that I adore. You have a level of sophistication that is so fitting with your beauty. I could digress and say that you have the ability to give magnificently gentle kisses, or that I love your tan lines or that I love the curves of your hips, the erotic beauty of you holding yourself (or two magnificent parts of yourself) in the faded glow of night’s light — but hey, that would be going into the sexual details we spoke of at the steakhouse at dinner — and unlike you I would never do that!”

$$$ Judge defers ruling on Madoff restitution [Dealbook]

$$$ KKR’s latest plan to go public [marketwatch]

$$$ Bankruptcy league tables [The Deal]

$$$ 3 months salary or $10,000 cash [craigslist]

$$$ “There will be people who think that Bernie can give them stock tips, but I don’t see anyone being his big pal,” said Levine. “I believe he’ll be treated like an outcast.”

Levine said that Madoff should always “maintain high visibility” as a security precaution. [CNN Money]

According to Bloomberg. Do you think Lewis will watch on TV? Or will it be too bone chilling?

Guys, for some reason I’m having dinner tonight at an undisclosed location with, among others, Charlie Gasparino. The only question I have for him is “when will you make good on your promise to drop the pretense and appear on CNBC wearing a Champion sweatshirt with the sleeves cut off,” but is there anything you’d like me to ask Chaz on your behalves? I’ll report back his answers in full tomorrow, provided I’m not found in the trunk of a car before then. Obviously no holds barred.

Update: I don’t know if this will change whatever question you wanted me to ask, but I’m supposed to add that CG’s friend Eddie “who owns a gay club” will likely be joining us tonight.

Earlier: A Message (And A Challenge) From Charlie Gasparino

Trust him, he’s tried.

Sure, Sciens Capital has supposedly taken over to make people feel less squeamish but according to an investor it’s business as usual (ixnay onay adoffmay).

FGG has transferred management of their funds to Sciens who they seem to be representing as a separate party.

However, Sciens seems to be basically a bunch of FGG guys.

They’re trying to get away from the scandal and the shame associated with FGG by representing to turn over the management of funds to a 3rd party, except the 3rd party essentially seems to be themselves / their ex employees. Smoke and mirrors show for the investors…nothing has changed.

Sciens Global Strategic Presentation [PDF]

If the methodology used to determine the effect of government stimulus on employment is the new blueprint for important economic data, we are going to be able to guesstimate ourselves out of the recession. The Deputy Director of the White House Office of Management and Budget, Rob Nabors, has cautioned states that they will be required to utilize groundbreaking sampling techniques to estimating the number of jobs created through the stimulus.

Recipients won’t be asked to grapple with complicated estimates. Instead, they may use their best guess whether a job would have been created or saved in the absence of a recovery plan, and to not count it if they are uncertain.

States Given Leeway in Tallying New Jobs from Stimulus [WSJ]

Ambac may have just suffered the ultimate humiliation- being told by a rating agency that their business model is completely broken and they have no real prospects going forward. The bond insurer’s shame spiral began last week when it couldn’t raise enough capital to launch a new muni unit and has now graduated to a eulogy from S&P.

“Loss reserving increases have depleted surplus, boosting the likelihood of regulatory intervention, and we believe Ambac’s prospects for writing new business are negligible,”

S&P cuts Ambac rating, says “effectively in runoff” [Reuters]

Allegations that had been made prior to this afternoon: Bernanke and the Fed told Ken Lewis to keep Merrill’s losses in the lock-box or KL would lose his job/kidneys. Now, courtesy of Represenative Darrell Issa, we’ve got the exact same allegations, but with sinister turns of phrase like “inappropriate threats” and “cover-up.” He didn’t say anything further because, as we hope Bernanke will tell him in this voice tomorrow, “you got nothing.”

Not sure why, but Steve Liesman, looking quite flustered and as though he was about to cry, read us a statement out of the Fed from April that said it/Bernanke acted with the “highest integrity” when it came to the BAC/MER deal. Don’t worry, Liesy-girl, Benji’s got this one.

And speaking of jobs, not of the smear but blow variety, Governor Sanford apparently got himself a few from his “dear friend” while in Argentina. Now get back to work.

After happily watching Lehman free fall into bankruptcy and cherry picking the remains, Barclays is now on the hot seat for screwing Lehman a second time by overstating the liabilities it was assuming and later booking a $4 billion gain. Barclays capitalized on the fact that, unlike Lehman, it was not in bankruptcy and still had shareholders to answer to when it estimated the liabilities associated with acquiring Lehman’s investment banking and capital markets units. But a US bankruptcy judge has now ruled that Lehman gets to take a look at Barclays’ math to determine if things like accrued bonuses were ever paid out or simply pocketed.

Lehman Wins Right to Probe Barclays on Alleged Profit [Bloomberg]

So re: that report Citi will be raising base salaries to compensate for bonus shrinkage? TARP Congressional Oversight Panel chair Elizabeth Warren is not happy. She appeared on Bloomberg earlier today to say as much, and take issue with the claim that Vikram made a few months back on the Hill that he now understands the reality of what’s up.

“I just have to say: These guys just don’t seem to get it,” Warren said. “They’re taking taxpayer dollars in order to keep this business alive, and yet they think that, when Americans are out of work, when people are struggling, when this comes out of taxpayers’ pockets, that they can double their salaries? This is more about: Does anyone really understand what’s going on here?”

Liz! Has it not been made clear that when it comes to Citi, with the exception of tackling janitorial issues, the answer is always no? Do you know what’s going on here?

In related news, the SEIU, also not happy with the ‘group, had this to say:

“Color us skeptical, but not surprised: The top dogs at a company who took three taxpayer-funded bailout packages worth $45 billion, while wrecking the economy and keeping the bulk of its employees at near-poverty levels, have decided to reward themselves once more. Unfortunately, not all raises are created equal.

Citigroup needs to commit to give any new raises to front-line bank employees, who struggle just to make ends meet while dealing with the rising costs of healthcare, not top executives who have contributed to this mess.”

Warren Slam Citi [The Hill]

So, former Fortress PMs Philippe Peress and Jonathan Ratcliffe are apparently starting a hedge fund, scheduled to launch sometime between July and August. Can’t say we’re particularly interested, given that our money is already locked up in Ball Gag Capital, but perhaps one or two of you might be? As of mid-June only $50 mill had been raised, so it’d be nice if someone would fork over a little cash. If you need convincing, the marketing materials, which were dropped outside our door in an envelope marked only “Dealbreaker” sans address about ten minutes ago,* can be found after the jump.

*Guessing the cloak and dagger nature of it all had something to do with the issue of the SEC frowning upon this sort of thing but for future reference to any of you budding managers looking to have DB disseminate your business, know that we don’t bite unless expressly asked to do so and have no problem going to jail for our sources.

The CMBS lawyers involved with the Extended Stay bankruptcy must be having a field day with the tightrope walking real estate investor David Lichtenstein is doing to save his skin. Under a proposed bankruptcy restructuring plan, Extended Stay would see $4.8 billion in debt wiped out and Lichtenstein would be indemnified from $100 million in bad boy payments. While the plan has gained support from senior CMBS bondholders including Cerberus and Centerbridge, junior bondholders such as Five Mile Capital Partners are having no part of this and suing.

We’ve received a bunch of emails from people who cannot wrap their minds around the fact that we’ve yet to put up any analyst bonus rumors. We think at this time such talk would be premature but for anyone just dying to wildly speculate, please use this as a forum for such chatter and fire away. For those of you unsure of what you might be taking home but dying to get in on the conversation, we suggest taking what you made last year, dividing by 1,000 and adding some salty tears, unless you happen to be typing from a handheld at 85 Broad, in which case, get ready for some sticky fifties, despite Lloyd’s claims that they won’t know what’s what ‘til December. Have at it.

The SEC is using Twitter to come back from behind and now, apparently, traders are using the social networking site to get ahead and make make money money take take money money on rumors about Jon & Kate and other info you can’t wait to hear from slow as fuck newswires.

Traders are using software developed by US-based technology StreamBase to monitor “tweets” for price sensitive information.

The software plugs into Algorithm-based automated trading platforms that have been used by traders for years. But rather than searching Reuters or Bloomberg the software now scans Twitter.com.

Streambase - whose client base includes Royal Bank of Canada and London-based hedge fund BlueCrest Capital Management - was commissioned to develop the software by several “unnamed” clients.

It remains to be seen whether or not they’ll actually make (or lose) any clams on it but it seems at least a few big guys are thinking twats might be the ticket to some big pay days. So far, though, they’re just using it for fun.

kengriffin: K&W up 7% MTD, so f’ing back, baby!

stevieboyc: @kengriffin congrats wonderboy, only 3 yrs to go ‘til the HWM

Related: SEC To Make Up For Completely F*cking Up By Joining Twitter

As previously noted, “massive” layoffs affecting equities at all levels went down at Barclays yesterday, and, supposedly, the cuts will continue until next Friday and be “rather substantial.” Some of you wondered what the deal with that was, as it seems like this is the 10th round of axings at the bank. The answer is simple: the Brits needed to free up some cash to have a subway stop named after them, which has always been a dream of Bob Diamond. If all goes according to plan, in exchange for $4 million, the Atlantic Avenue, Pacific Street and Flatbush Avenue station in downtown Brooklyn will bear the Barclays name, sort of, though not exclusively. It will be called the Barclays’ Atlantic-Pacific (having the thing all to themselves would’ve cost extra). Since the Brits are obviously creating a hot new trend in which banks will scramble to have their name stamped on not very desirable MTA stops, where might we suggest Citi stick Vikram’s face? And where would Bank of America feel most at home? Think about this long and hard as some of you, in lieu of being canned, will be redeployed to your firm’s choice of platform to dance for cash.

EnTrust Capital Inc., a hedge fund firm that’s handled New York Attorney General Andrew Cuomo’s personal and campaign money, received state pension funds to invest from a company he has identified as paying possible illegal kickbacks.

The investment presents a potential conflict of interest for Cuomo, legal ethics experts said.

Cuomo’s Money Manager Received Funds Linked To Pension Scandal [Bloomberg]

A group of German senior citizens recently decided to forgo the legal process and deal with their investment losses the old fashioned way- vigilante justice. The silver haired bunch jumped their financial advisor as he was entering the door to his house, bound him with masking tape, thew him into the back of an Audi, drove him to one of the couples’ vacation homes and had their way with him in the cellar for four days. It took 40 members of the German counter-terrorism unit to get the active seniors to free their prisoner.

German Senior Citizens ‘Kidnap, Torture’ Advisor [CNBC]

Citi’s correspondent lending division, which produced $58.5 billion in mortgages last year and probably had a hand in the $28 billion in losses last year, recently sent out a letter to clients notifying them that the unit is shutting down their well oiled machine for two weeks to look into some mortgage applications that didn’t meet their lofty quality control standards.

According to the June 22 letter, the review identified “valuation concerns” where “appraisal documentation is missing or incomplete,” or where property-assessment methods were “insufficient/lacking.”

Other missing information included employment confirmations, phone numbers, credit reports and rent verification, the letter said. The review also found “income calculation errors.”

Citigroup Halts Some Mortgage Applications, Cites Missing Data [Bloomberg]

Of our nation’s hell-holes that is, by which we of course mean places like AIG, Citi, Bank of America, Freddie Mac, etc. The Journal looks into the situation today and discovers that while some of these institutions are in need of a new guy or lady up top, nobody capable has come forward and pledged to work ‘round the clock to fix the places for an annual salary of $1, a bunch of worthless stock, and the opportunity to have Maxine Waters shout at them in ǃ’OǃKung about a perceived role in late-night field trips with Goldman Sachs to dig up parakeet carcasses and suck out their essence.

Citigroup Has Plan To Fatten Salaries (NYT)
Pandit’s people can expect a raise in base pay by as much as 50 percent this year in order to— see if you can guess where this is going— offset smaller bonuses. Under this scenario, according to the Times, “most Citigroup employees will make as much money as they did in 2008, although some might earn more and others less,” so get excited for one of those three outcomes, though not so much the last.

Union Calls on Morgan to Reverse Raises for Top Earners (WSJ)
“We urge you to return base salaries to their previous levels and … reward executives for long-term value creation, not just showing up for work.”

Memphis Is Site Of Jobs’s Liver Transplant (WSJ)
Now that we’ve identified The Methodist University Hospital Transplant Institute it’s up to one of you to create some sort of bus tour, which would probably be pretty popular. (“This is the cafeteria where Jobs’s jello was prepared and up ahead we’ll show you the room in which he got hooked up to a catheter. Not one of those used ones they’re always advertising on CNBC but the Rolls Royce of catheters. This is Steve Jobs we’re talking about, after all.”)

NYSE Loses Trades Fastest in a Year and Nasdaq Isn’t the Winner (Bloomberg)
“…a record low 30.2 percent of May’s trades, data compiled by Bloomberg show. That’s down 2.8 points from February for the worst three months since June 2008. The beneficiary wasn’t Nasdaq OMX Group Inc., the Big Board’s main rival for 38 years. It was Direct Edge Holdings LLC and Bats Exchange Inc., which more than doubled their combined share since August to 22.8 percent.”

New York Times Considers Paid Access To Mobile News (Bloomberg)
Since someone, let’s call it the NYT, is desperate for cash anyway they can get it and Gretchen Morgenson’s trick turning days are over.

Allen Stanford detention hearing set for Thursday (Reuters)
Hopefully he’ll threaten to punch a reporter in the mouth outside the courthouse.

Margaret Brennan Jumps from CNBC to Bloomberg (TVNewser)
Insiders say she’s being named an anchor, which is nice.

JPMorgan Is On Top Of The World, RBS Not So Much (Reuters)
Rankings by British magazine The Banker somewhat suspect, given Bank of America and Citi’s spots at numbers two and three for “strongest.”

$$$ Stanford Leroy King Regulator Leroy King Is Relieved Of Duties [Reuters]

$$$ On The Matter Of That Harvard MBA Oath [The Deal]

$$$ Madoff Client Jeffry Picower Netted $5 Billion — Likely More Than Madoff Himself [pro publica]

$$$ Here are some interesting claims: first, that “a new set of cases of H1N1 are [specifically] expected to hit financial centers in the fall and winter” and second, that “organizations, in particular hedge funds, need to be well prepared for a pandemic.” This is apparently because HF’s “conduct business during trading hours.” [WST]

$$$ News Bernie Madoff and Allen Stanford will probably be able to use: prison rape stats [Chronicle]

If you work in 388 or 390 Greenwich St., your greatest problems have officially been solved.

Tackling Problems Big and Small at Citigroup [Dealbook]

Hedge funds that still have redemption restrictions are starting to get an earful from all sides. The decision by some of the usual suspects such as Citadel and Harbinger to continue to maintain total or partial redemption restrictions in certain funds has even drawn the ire of fellow managers.

“This is just wrong,” wrote Paul Touradji, of Touradji Capital Management LP, in his 2008 year-end letter. “It’s not good for our industry and it’s hurtful to our partners who will have less money to invest because of other managers’ losses, poor practices and the domino effect this sets off.”

But investors who are fuming that their money is still tied up should take some minor comfort. At least they haven’t been completely dehumanized by having the legendary Golden Tree payment-in-toxic-sludge-kind redemption program thrown in their face.

Withdrawal Limits Remain Despite Hedge Funds’ Rise [WSJ]

And is it because of dated (and ridiculous) rules that do not allow for interspecies conjugal visits in the big house? Maybe and definitely.

Sam Israel Vanishes Again! [Cityfile]

As you’re all sadly aware, Ed McMahon is dead. Despite rumors that EMcM’s Bevery Hills home was going to be foreclosed on by Countrywide, after the entertainer fell behind $644,000 on his $4.8 million mortgage due to the fact that he was unable to work having been bedridden with a broken neck, an unnamed private investor bought the place, which McMahon and his wife have been renting. Presumably Mrs. McMahon will relocate and the home will be sold, leaving us with two question, however morbid to ask. 1) Will Ed’s passing up the value of the manse and 2) Will Angelo Mozilo, who has been looking for more friends and less death threats these days, do the right thing and buy the place? And turn it into an Ed McMahon memorabilia museum/gift shop, which would probably at least ingratiate him to a handful of Star Search fans, and get those rat bastards at the NYT and WSJ to finally write something nice about him (obviously the FT’s in the can)?

Earlier: New Emails Emerge From The Ed McMahon Foreclosure File

Among the bills that GM may need to pay with their additional $30 billion infusion are massive fees due to two of the only big winners in the GM debacle, Evercore Partners and turnaround consultants AlixPartners. For their impressive work overseeing the automaker’s complete collapse, Evercore and AlixPartners are seeking fees totalling a cool $130 million, which includes a combined $30.9 million in success fees. But the US Trustee overseeing the bankruptcy thinks the “staggering” and “excessive” fees aren’t well deserved and is worried about one of AlixPartners’ fees in particular. As a token of its appreciation, GM agreed to pay the firm a “discretionary fee” that has “no boundaries in amount and scope” and no clear method of calculation.

Trustee Objects to Fees for G.M. Advisers [Dealbook]

“Massive” layoffs are said to be going down at Barclays circa now, affecting equities at all levels but especially first and second years. Apparently not everyone was brought up to speed that there’d be any whackings today— one victim’s boss (and his boss’s boss) had no idea about the layoffs, with the global head calling a bunch of employees into his office and letting them know they were getting canned due to “restructuring and non-performance based” reasons, without telling their direct managers first.

Update: One employee says it’s rumored the cuts, which started yesterday but “went into full swing today” will continue until next Friday and will be “rather substantial.”

The CDS witch hunt is turning from the auto industry to the newspaper industry. Several newspaper companies recently failed to gain meaningful interest in their debt exchange offers because the majority of the bondholders were hedged through CDS and, consequently, had no incentive to agree to the exchange. One of the primary complaints about the CDS market was the use of CDS by market participants as purely speculative tools. In this case, the players that hold the debt are hedging their exposure through CDS and capitalizing on a negative basis play. If hedging debt exposure through CDS becomes the next true villain in the attack on derivatives, there is really no hope for this market.

Credit default swaps threaten newspaper cos. [The Deal]

From the people who brought you in-flight blow jobs (for pay in economy, for free in business), comes another outside the box idea. Bloomberg reports that Ryanair will ban passengers from traveling with check-in luggage. While you won’t be able to bring anything that can’t fit in an overhead compartment, it will be a relative free for all when it comes to carry-on bags, where the airline will apply no limit. For those of you worried about some asshole loading 12 bags of his own up top, do not fear. According to CEO Michael O’Leary the change, which will apparently save $28 million a year, will not mean “the end of civilization as we know it” and if you sufficiently bitch and moan about it enough, he’ll probably throw in a BJ for free, regardless of your seat.

1. He came clean all by himself

2. He’s been a good boy

3. He didn’t kill anyone, per se

4. He’s going to be dead in 13. 12 would practically be putting him away for life.

Affording due consideration to Mr. Madoff’s voluntary surrender, full acceptance of his responsibility, meaningful cooperation efforts, and in light of the non-violent nature of his offense, Mr. Madoff should be sentenced to a term just short of effective life imprisonment. Mr. Madoff is 71 years old and has an approximate life expectancy of 13 years. A prison term of 12 years—just short of an effective life sentence — will sufficiently address the goals of deterrence, and promoting respect for the law without being “greater than necessary” to achieve them.

Bernie Madoff’s Lawyers Would Like Him to Celebrate His Last Birthday Out of Prison [Daily Intel]

Larry Kudlow, as you may have noticed, is for some reason obsessed with Larry Summers taking over for Ben Bernanke. Is this because LK just loves the idea of having a “Chairman Larry”? Did Summers make Kuds a promise back in their Studio 54 days that if he ever got the job, he’d commission the printing of a stack of special edition hundos with Kudlow’s face on them* through which the two would do seemingly endless lines off the president’s desk? It’s unclear. But does buddy boy have a point? And if not, why not?

*Early in Bernanke’s tenure L-Kud approached him about this but was brutally rebuffed. Kuds knew better than to ask Greenspan, who had a hard and fast policy of only printing special edition bills bearing the mugs of his favorite Hill bitches.

Before another New Jersey health care worker gets thrown for a loop and tries to cover their losses from yet another structured product by suing everyone involved, Finra sent out a little reminder to brokers and investment advisers that leveraged ETFs are not for everyone. They cautioned that these “highly complex financial instruments” are typically unsuitable for retail investors. For those who might selectively confuse the safety of products labeled ultra short/ultra long for the cash stuffed under their mattress, the Finra communication is bad news. Now they might have to freely admit that they were simply greedy and didn’t know what they were doing.

Finra Urges Caution on Leveraged Funds [WSJ]

The following post is by a hedge fund manager friend of DB who shall remain nameless. He runs the emerging markets desk at his firm.

Emerging Markets and derivatives are like alcohol and barbiturates: each on its own has attractions but create a recipe for choking on one’s own vomit when combined. And despite all warnings, rock stars (or in the case of finance “rock stars”), real and aspiring, continue to do just that. The latest set of investors to get the Jimi Hendrix experience: writers of CDS on the Kazakh financial institution BTA Bank. The bank, by some measures Kazakhstan’s largest, declared its intent to restructure its debt back in late April, after the authorities alleged its loan book to be riddled with undisclosed related-party deals and its controlling shareholder, Mr. Mukhtar Ablyazov, fled the country. On a loan book of KZT 2.4 trillion, it has now provisioned nearly KZT 1.5 trillion, the sort of write-down that makes Merrill Lynch look like a bunch of pikers. Sadly for creditors, it didn’t occur to Mr. Ablyazov to try to pitch the bank to Ken Lewis.

The chicanery at BTA Bank itself is another story, though. ISDA’s Determinations Committee declared a credit event on April 29th. The baleful interaction of EM and derivatives relates to the CDS credit event auction. BTA Bank had issued a fairly full curve of eurobonds, most of which traded in the wake of the default in the mid-20s. The spirit of creativity was strong with the Kazakhs, though, and the bank was understood to have done a fair number of private deals. Less well-understood was the magnitude of off-balance sheet borrowing. A few “shell” borrowers - reputedly related to BTAS’s controlling shareholder — had taken out loans from western banks, which in turn got guarantees on these loans from BTA. The “shell” borrowers in turn onlent to Ablyazov-related entities (as Borat would say, “Naughty, naughty!”). Credit Suisse was the most active lender; at the time of making the loans - which yielded a premium to other BTAS obligations - it had gone and hedged itself by buying CDS from the market.

Dow Jones reports that a group of ex-Citi dwellers (Antonio Cacorino, formerly of Citi’s global corporate and investment-bank management committee, Frederick Chapey, who was head of global structured credit derivatives, Robert Cummings, former head of Citi’s European credit products distribution and Sohail Kahn, former managing director responsible for legacy-asset remediation efforts) are starting themselves a hedge fund. It will be called Old Lane The Sequel, and they’ll be selling it to Citi for a trillion dollars in 3-5 years. Just fucking with you (about the name, not the prediction, which we’ll revisit at a later date), they actually went with something worse: StormHarbour Partners LP. I get that it was probably intended to sound dangerous and whatnot, but there are a lot of other, dryer, natural disasters you could go with that don’t lend themselves jokes about being underwater. Then again, earlier ideas are said to have included Katrina Capital and Golden Shower Management, so I guess this is preferable.

The Acting Assistant Secretary for Financial Markets, Karthik Ramanathan, gave a bit of a pep talk yesterday regarding US debt issuance for 2009 and 2010. People should take comfort knowing that the US has funded nearly 80% of its total “expected borrowing needs” of $2 trillion to fund the fiscal deficit for this year and is “well situated” on its funding needs for next year. However, left out of this feel good speech was any guidance on the administration’s demand forecast for US debt that falls into the “unexpected borrowing needs category” on the off chance the government’s macroeconomic assumptions are a tad too optimistic.

US Treasury: Funding Needs Large But “Manageable” [Dow Jones via Nasdaq]

Ira Sorkin has put it out there that he’d like his client to get less than life when he’s sentenced on June 29. Also, apparently Ponzi Boy is planning on speaking about “the shame he feels and the pain he’s caused,” and attempt to paint himself as a victim with regard to “the death threats and anti-Semitic e-mails he’s received.”

Update: This is good— Sorkin is asking that Bernie get twelve years.

As previously mentioned, the Central Intelligence Agency wants you, yes you, up in its business. The Company will be conducting interviews in the city this summer, and though its website claims you had to submit a resume by yesterday to be considered, there’s probably some wiggle room there. While starting salaries aren’t as high as you’d probably like ($48,682 - $95,026), spokeswoman Marie Harf, thinks the “deeper sense of patriotism” than you’d get working for, say, Citi, is a decent trade. She also adds that many of you have no other options (unless you count choosing between what they’re offering and zero dollars), which we find a tad bitchy but not necessarily untrue. Plus, there’s the badass factor of telling people you work for The Agency, even if you’re not staffed in the field and, let’s be honest, none of you fairies are cut out for something that dangerous.

According to “Jim,” who previously worked at an unnamed bulge bracket bank, and took a gig with the CIA after 9/11, working in finance is cool but if you’re not actively shutting down the next attack on the country, you’re not doing much at all. “Even though we were doing important work in investment banking, you don’t get the feeling every day that you are making a contribution or doing something that matters. You might help a company go to the bond market and get some money, but is that really using all of your talents and abilities … [to] avoid another 9-11? I wanted to find a responsibility here that would leverage my educational background but also my finance background.” Interested? Here’s what they’re looking for:

Ideally, applicants are “specialists in international banking systems, financial markets, financial transactions, financial instruments, and energy. Economic analysts will also assess illicit financial activities, including networks used by terrorist and criminal groups, financing and procurement of weapons of mass destruction, money laundering, and corruption among foreign governments and companies.”

“The skills sets are similar, trying to understand trends,” says a senior banker with a Wall Street boutique firm, adding that the CIA’s attempts at recruiting from Wall Street come at a time when many professionals who have lived through the financial crisis have to be “rethinking their priorities.”

Oh, and there’s this:

Dick Fuld, pictured with former LEH executive vice-president Scott Freidheim, enjoying himself at a wedding in Paris.

Goldman Denies It Will Pay Out Huge Bonuses (NYDN)
I mean, it will, but the issue here is that we don’t know if they’ll be record-breakingly big just yet. We can certainly make guesses, though, which you should feel free to do at this time.

U.S. credit rating a “solid triple-A,” Says Moody’s (Reuters)
But it could be at risk for the d-word. “Either our assumptions in terms of debt reversibility prove to be wrong. That is, in fact the U.S. government is unable to bring public debt back to a downward trajectory,” Pierre Cailleteau, team managing director of Moody’s Sovereign Risk Group said.

Three Banks Suspend TARP Dividends (WSJ)
At least three cash-strapped banks have stopped paying the government the dividends they owe: JPM, GS, MS. No, just messing. Jamie Dimon would sell his liver if need be. The banks are pacific Capital Bancorp, Seacoast Banking Corp, and Midwest Banc Holdings.

Buffett Boy Raises $2 billion (FT)
Byron Trott, AKA “Buffett’s banker,” has raises a nice chunk of change for his new firm, BDT Capital Partners. For those interested in getting in on that, BDT will “maintain a close relationship with Goldman,” Trott’s former employer.

A Transplant That Is Raising Many Questions. You Know The One. (NYT)
Doctors say there is “little opportunity” to cheat the system when you need an organ, but the Times apparently remains unconvinced that Mock Turtleneck didn’t do just that.

What Has the World Bank or IMF Ever Gotten Right? (Infectious Greed)
Paul Kedrosky would like to know.

No Jobs On Wall Street Mean Graduates Can Have A Social Conscience Now (Bloomberg)
Nationally, 27 percent of about 1.6 million graduating seniors plan to work for nonprofit groups or governments, an increase from 23 percent in 2008.

Settlement Anticipated In UBS Case (NYT)
“The Justice Department may drop a closely watched legal case aimed at forcing the Swiss bank UBS to divulge the names of 52,000 wealthy American clients suspected of offshore tax evasion, a United States official briefed on the matter said Monday. The move, which would halt an unusually aggressive effort to force Switzerland to lift its veil of banking secrecy, could happen by mid-July.”

$$$ Hiring: Morgan Stanley, HSBC, CIC and more. [The Deal]

$$$ Investor’s Widow Says Madoff Murdered Husband [Dealbook]

$$$ Stalkers: Erin Burnett will be in Hoboken tonight. [NJ.com]

$$$ RIEF Outperforms S&P by 2.06% MTD, RIFF Plunges [ZH]

$$$ Job of the Week: A multi-strategy hedge fund seeks experienced portfolio manager for launch of new fund focused on inflation/interest rate strategy. That could be you. [DB Career Center]

$$$ Consider making your next hire a shark: “Great white sharks have some things in common with human serial killers, a new study says: They don’t attack at random, but stalk specific victims, lurking out of sight.

The sharks hang back and observe from a not-too-close, not-too-far base, hunt strategically, and learn from previous attempts, according to a study being published online Monday in the Journal of Zoology. Researchers used a serial killer profiling method to figure out just how the fearsome ocean predator hunts, something that’s been hard to observe beneath the surface.

“There’s some strategy going on,” said study co-author Neil Hammerschlag, a shark researcher at the University of Miami who observed 340 great white shark attacks on seals off an island in South Africa. “It’s more than sharks lurking at the water waiting to go after them.” [AP]

His wife (among others) is looking for him.

Unfortunately, he wasn’t interviewed for the latest issue of Fortune, for which the cover story is “The Best Advice I Ever Got,” but presumably that’s what he would’ve said. People who were actually questioned for the article include Lloyd Blankfein (who said the best pearl of wisdom ever laid on his ass was “empower a subordinate”), Mohamed El-Erian (“Push beyond your comfort zone”), Jim Rogers (“read”), and Meredith Whitney (who lied and said the best piece of advice she ever got was “set realistic goals” when we all know it was “establish a safeword beforehand”). The wisest thing anyone ever told Julian Roberston was that you’ll make a lot more friends/clients getting hammered and doing magic tricks at parties than you will talking shop.

The SEC is finding new and creative ways to tarnish its image. After estimating that it would recover close to $1 billion in assets in the Stanford fraud case, the SEC now finds itself shoulder to shoulder with the guy they intend to prosecute. The receiver in the Stanford case, Ralph Janvey, has petitioned the court to approve $20 million in fees and expenses for work performed on the case since February. However, when the SEC discovered its recovery estimate was about $650 million too high, it petitioned the court to reduce the amount due to the receiver. Team SEC/Stanford have an uphill battle on their hands.

“None of the professionals was retained with the understanding that they would be subjected to deep discounts if the recoverable estate assets were less than the SEC expected,” the court filing said.

SEC opposition to Stanford fees unjustified-filing [Reuters]

Wells Fargo will fine you $100 for looking at your Blackberry during a meeting. At Goldman Sachs it’s frowned upon unless you’re obtaining info with which to front run prime brokerage clients. Bank of America doesn’t care what you do as long as you blow less than 0.3% on your daily breathalyzer test (and even there, there’s wiggle room). With very few exceptions, however, most firms don’t have policies on ‘berry or iPhone use during meetings, according to the Times, which devoted resources to an investigation on the matter this weekend. The tricky thing, you see, is that the reason you shouldn’t tappity tap tap tap while people are talking (it’s douchey and rude), is the same reason you might want to (i.e. douchey and rude, you may have noticed, equal important in this biz).

Mr. Brotherton, the consultant, wrote in an e-mail message that it was customary now for professionals to lay BlackBerrys or iPhones on a conference table before a meeting — like gunfighters placing their Colt revolvers on the card tables in a saloon. “It’s a not-so-subtle way of signaling ‘I’m connected. I’m busy. I’m important. And if this meeting doesn’t hold my interest, I’ve got 10 other things I can do instead.’”

Discuss. (If one of the more enterprising Dealbreaker readers in the audience would care to slap together some sort of clip show to the contrary, that’d be top notch.)

JPM may be a large financial institution but it will notice things like a $246 million revolving line of credit not being paid back- at all. Illinois-based bank holding company FBOP Corporation, which owns a group of real estate focused community banks in Arizona, California, Texas, and Illinois is probably hoping that somebody at JPM will buy the ‘check is in the mail excuse’ long enough to either panhandle for the last million or flee the country. FBOP was required to pay just under $248 million in principal, accrued but unpaid interest, and fees on May 28th but it apparently slipped their minds and now Jamie is about to bust out the brass knuckles.

JP Morgan Chase sues FBOP Corp. [Chicago Tribune]

No, he’s not talking about himself (you think Uncle Jim would survive a day in the big house? They don’t teach you how to escape the wrath of Bubba at Goldman Sachs, where he once worked, in case you didn’t know). He’s talking about journalists. Also, if you didn’t catch it, the whole First Amendment thing? Jim’s “never been for it.”

In the latest issue of Crain’s Aaron Elstein examines the massive package of Mario Gabelli. Last year’s paycheck ($46 million) was bigger than that of Lloyd Blankfein and John Mack combined and more than twice the size of Larry Fink’s take-home. We’d advise you to not even entertain the thought of making comparisons, though, which Big G says are baseless crap (or bringing up the fact that the firm only took in $25 million in 2009). Plus, he’s got an explanation for it all that will just make you look like an idiot and him look like a guy on ‘roids.

Mr. Gabelli makes no apologies. The Bronx native says comparing his pay to Mr. Fink’s is “bull,” because while other CEOs dedicate their time to strategic and administrative matters, Mr. Gabelli still gets his hands dirty researching stocks and wooing clients to the firm he started in 1977.

“If A-Rod was managing the Yankees, he’d get $2 million a year,” Mr. Gabelli argues. “But he’s a player, so he gets more.”

He adds that 98% of shareholder votes were cast in approval when his compensation package was last voted on two years ago. What Mr. Gabelli doesn’t say is the outcome was never in doubt: He controls 95% of his company’s voting stock.

Other things you should consider not bringing up are pay cuts some of Gabs’ staff was forced to take, or the layoffs wherein a gaggle of Gamco-ers apparently only got two weeks severance. Probably safe to mention (like in an interview or something) is son (and employee) Matt, who’s been seeing a stripper from Beamers, Stamford’s premier topless bar, and recently escorted her to his brother’s wedding. Could be a source of fatherly pride or some such. I don’t know, I’m just trying to get you a little career advancement.

Citigroup Property Investors CEO Roger Orf has clearly not read the toxic asset playbook. If he had, he’d know that the game plan for dealing with toxic real estate assets is to create a series of proposals designed to distract people for a couple months while waiting for your deity of choice to deliver a property valuation miracle that makes parting the Red Sea look like a cereal box magic trick. Instead, Orf wants governments to force bailed out banks to sell toxic real estate assets through a hallmark Citi strategy.

“I personally feel the best way to do that is through creative destruction as opposed to a malaise where you let the air out of the tire over a number of few years”

Citi urges governments to pull bank foreclosure trigger [Retuers]

The Journal reports the SEC has filed fraud charges against the co-owners of Cohmad, an investment firm that has described its relationship with Ponzi Nation as “blurry.” Cohmad’s vice-president is Robert “Madoff point man” Jaffe who, on more than one occasion, told Massachusetts regulators to go fuck themselves, after requesting he show up to talk Bernie. That doesn’t necessarily mean they/he are guilty, but it definitely adds some much appreciated class to the situation.

Update: The charges, according to Jaffe’s attorney are “unfair, baseless, and inaccurate,” and demonstrate “impulsiveness and self-justification” on the part of the SEC. Which, re: self-justification, is probably true, but doesn’t necessarily make Bobby innocent.

Not saying, just saying, it definitely sounds like Team Financial Services Hacks was well represented what with the public drunkenness (Bank of America, Morgan Stanley), you sucks (CNBC), and fat shaming (Citi).

Beer-sodden fans and rain combined for an ugly finish to a long day of golf yesterday, with Tiger Woods and other golfers subjected to drunken heckling as the action at Bethpage Black came to a close.

At 6:42 p.m., dozens of drunken spectators at Hole 10 taunted Woods as he prepared to start his third round in the rain.

“We’re on Long Island, baby, where men are men!” one fan yelled. “Put that umbrella down!”

A little earlier, drunken fans at the seventh hole shouted at golfers, “This Bud’s for you!” On the ninth fairway, drunks called out “you suck” to players while spectators on the other side booed the hecklers.

*Or what the disgraced and unemployed CEO’s in the audience would just call a “day.” The LI quote certainly sounds like it could’ve come from Jimmy C, hammered or not.

Former commercial bank CEOs are getting a new lease on life by becoming the Billy Mays of the PE world. Firms are having success appeasing government concerns over PE ownership of failed banks by hiring retired bank CEOs to spearhead takeover efforts. Evidently those individuals that can sell their hybrid bank revival strategy of Oxi Clean, Mighty MendIt and Mighty Putty to the government now have special place at PE firms.

Ex-Bank CEOs Become Buyout Pitchmen [WSJ]

The latest issue of the New Yorker has a lengthy piece on the Tan Man (more on hue in a sec), who apparently is not doing so well of late. He has very few friends left (Big Al is of course still pulling for the guy and vice versa, along with Stan O’Neal and Jimmy Cayne AKA the Circle Jerk of Doom, which meets monthly to fuck the corpse of Ayn Rand). He’s received “numerous” death threats. He’s been forced to cut off the New York Times, the LA Times, and the Wall Street Journal, on account of what he believes is unfair coverage. (In what must be the greatest rousing endorsement of all time, Mozilo continues to read the Financial Times, which we’re thinking the Brits should incorporate into their tagline.) Most heartbreakingly, one former employee notes that Moz-y-boy rarely “flashes that $10,000 watt smile” anymore. Basically, all he really does these days is amble around his “large Spanish-style house in a guarded gated community at the Sherwood Country Club,” where he reflects on the past. Like being mistaken for a black man.

For those of you who care about Hartford Financial (there have to be at least two of you with insurance fetishes), names being floated to take over for chief exec Ramani Ayer, who intends to retire by the end of the year, include AXA head Christopher “Kip” Condron and Bank of New York CEO Robert Kelly.

The Guardian reports that the annual auctioning of lunch with Warren Buffett, with proceeds going to the Glide Foundation, may not fetch as much cash this time around. In previous years the thing went for $650,000 and over $2 million, took place on vintage a Russ Meyer set and included dessert (Oreo Blizzards) being served off a stripper’s tits. Now that the Oracle of O has “failed to cover himself in glory” people may be less willing to shell out for three hours of aberrant sex fetish and folksy business wisdom, even if it does include O Cubed’s personal collection of Becky Quick money shots. The auction kicked off last night with the current bid at just $31,000.

Russian-American investor, Len Blavatnik, whose industrial holding company, Access Industries, reportedly lost $98 million on subprime investments wants to have a word with the House of Dimon. Blavatnik alleges his JPM banker, Ted Ufferfilge, had a unique interpretation of a conservative, low-risk strategy for his investments is suing JPM for his losses. When the subprime market started to tank and Blavatnik wanted out, Ufferfilge gave him those soothing words of wisdom- the investments were “money good”. JPM points out that anybody vulnerable enough to wind up in subprime investments qualifies as a “sophisticated investor” and therefore the lawsuit is frivolous.

“We believe this lawsuit is meritless and a transparent attempt to recover losses resulting from the unprecedented market downturn. We intend to defend this matter vigorously.”

Company Is Planning to Sue Chase Over Investment Losses [NYT]

Been considering doing the MBA thing but either didn’t get accepted to your top pick or get it together in time to send out any apps? Might we suggest Chancellor University System LLC, which comes out of the remains of formerly bankrupt Myers University in Cleveland? Most classes will offered online so you won’t have to relocate (or even get out of bed) and— and this is what we think will be the biggest draw— the MBA program will be known as “The Jack Welch Institute.” Welch recently paid $2 million to have his name and face stamped on the place, after meeting lead investor Michael Clifford at a party a few years ago. For those of you thinking an online degree might look a bit low rent on the res, do not fear. Jackles wasn’t sold initially, either.

Mr. Welch says he was initially skeptical of online education, but has been impressed by the Apollo Group Inc.’s University of Phoenix, which has nearly 400,000 students, and Mr. Clifford’s Grand Canyon University. Last fall, he called Mr. Clifford and said he wanted a role in Chancellor.

“I’m now a believer,” Mr. Welch says.

Will you get to take classes in the art of throwing scalding hot coffee on people who cut you off in the parking lot, like you would at HBS? No. And for some of you, that’s probably a dealbreaker. What you will get is “a real education,” according to Welch, who adds, “I think.”

Goldman Sachs May Pay Record Bonuses (Guardian)
If all goes according to plan!

AIG Trading Partners Put Squeeze On Insurer Before Bailout (Bloomberg)
“Goldman is to be congratulated for seeing the problem ahead of others and protecting itself from the impending failure of AIG,” said William Poole, former president of the St. Louis Fed, in an interview last week. “It’s not the responsibility of any private firm to determine what the public interest is — that’s why we have a government.”

Bankers’ Pay Soars In Attempt To Halt Exodus (FT)
“Market salary rates for managing directors have jumped from about $250,000 (€180,000) only a few months ago, to closer to $400,000. As well as base salary hikes, banks are once more offering guaranteed bonuses to staff approached with lucrative offers by rivals. Bank of America, for example, has seen off attempts to poach top Merrill bankers by matching or bettering offers.”

Morgan Stanley Topples Goldman As M&A Leader (NYP)
YTD through Friday, MS has been the lead adviser on $175 billion worth of US-based M&A deals, surpassing Goldman Sachs, which advised on $158 billion worth of deals.

Berne says U.S ready to move in UBS tax case (Reuters)
“U.S. authorities could be willing to make a deal in a legal case against Switzerland’s biggest bank, UBS, after the countries agreed a double taxation treaty last week, the Swiss president said on Sunday.”

Hedge Funds Boost Profile In Lobbying (WSJ)
Biggest spenders on lobbying since 2007 through Q1: Managed Funds Association, Citadel, Coalition of Private Investment Cos, OZ Management, Elliot Associates, Fortress, HBK.

RBS To Incentivize CEO (Telegraph)
He’ll get $15.8 million “if shares recover to 70p withing three years.” Contract includes a “no rewards for failure” clause.

Bill Gross Is On Treasury’s Speed Dial (NYT)
“Paulson will call, Geithner will call, and I’ll be like, ‘Yabba-dabba’ or ‘Blah-blah-blah,’ ” he says with a measure of self-deprecation — and an equal dose of pride. “I turn into a walking, talking idiot.”

$$$ Law firm Wachtell weighs in on possible short selling rules in letter to the SEC. “Selling a stock short in combination with the purchase of such a swap — tied to a company’s ability to pay its debt — can send a false signal into the marketplace,” the letter said. And as everyone knows, market prices are always accurate, right? Oh, yeah…. [Law360]

$$$ JPMorgan expects $1.1 billion Q2 charge after TARP [Reuters]

$$$ Marc Dreier’s Homes Underperform on the Block [Curbed]

$$$ Bank of America done with Merrill’ bull [The Deal]

Felix Salmon thinks so, devoting a post to the supposed weight gain today, in which he draws particular attention to the neck area. Our thoughts on this:

1. Uncalled for.

2. Not even taking into account that the supposed evidence of fat is taken from a most unflattering angle, the fact of the matter is that Pandito has drastically slimmed down since taking over at Citi. So even if he’s put on a few lbs over the last few months, he’s still way under his starting weight. Practically gaunt, in comparison.

Exhibit A.

Goldman Sachs super fan Maxine Wat