Citigroup CEO Vows to Fix Regulatory Problems as Bank Logs Higher Profit, Beats Estimates (WSJ)
Speaking after Citigroup reported better-than-expected first-quarter earnings Monday, Mr. Corbat faced more than a dozen questions from analysts on the bank’s recent failure to win regulatory approval to return capital to shareholders. “Is the Fed denial a wake-up call for Citi or not?” CLSA analyst Michael Mayo asked. “We’re wide awake,” Mr. Corbat replied after declaring earlier, “I want, and I know shareholders deserve, an industrial-strength, permanent solution that paves the way for sustainable capital return over time.”
Stockbrokers Who Fail Test Have Checkered Records (WSJ)
More than 51,500 stockbrokers failed a basic exam needed to sell securities at least once, according to data that Wall Street regulators don’t disclose to investors, and those who repeatedly failed have on average worse disciplinary records. The more times a broker failed, the higher the average total of black marks was, such as criminal charges and firings, a Wall Street Journal analysis of the data found. Those who failed the test more than twice, for example, were 77% more likely to report a felony or financial-related misdemeanor than brokers who passed the exam on the first try, and about 55% more likely to have been terminated.
Mt. Gox founder won’t appear in U.S. for questions about bankruptcy case (Reuters)
Mark Karpeles, the founder of Mt. Gox, said he would not come to the United States to answer questions about the Japanese bitcoin exchange’s U.S. bankruptcy case, Mt. Gox lawyers told a federal judge on Monday. In the court filing, Mt. Gox lawyers cited a subpoena from the U.S. Department of Treasury’s Financial Crimes Enforcement Network, which has closely monitored virtual currencies like bit coin. “Mr. Karpeles is now in the process of obtaining counsel to represent him with respect to the FinCEN Subpoena. Until such time as counsel is retained and has an opportunity to ‘get up to speed’ and advise Mr. Karpeles, he is not willing to travel to the U.S.”, the filing said.
Regulators Weigh Curbs on Trading Fees (WSJ)
SEC officials, including some commissioners, are considering a trial program to curb fees and rebates they say can make trading overly complex and pose a conflict of interest for brokers handling trades on behalf of big investors such as mutual funds.
NY attorney general probes Herbalife: sources (NYP)
New York Attorney General Eric Schneiderman is investigating Herbalife over claims it is a pyramid scheme, The Post has learned. At least two whistleblowers have come forward and given Schneiderman’s investigators sworn testimony, sources said. The New York lawman has also fielded complaints from former Hispanic Herbalife distributors who say they were defrauded by Herbalife, sources said.
Berlusconi Given Community Service for Tax Fraud (NYT)
Former Premier Silvio Berlusconi must spend at least four hours a week in the service of the elderly to repay society for his tax fraud conviction, the first sentence against him ever confirmed by Italy’s highest court. The one-year assignment, announced by a Milan court on Tuesday, curtails Berlusconi’s ability to participate in the upcoming European election campaign — a point of contention among his political allies…The court stipulated that Berlusconi must spend most of his time in the Lombard region, where he lives, but granted permission to travel to Rome from Tuesday to Thursday each week. He must spend at least four straight hours one day a week at an elderly center, the court said. The document did not identify the center, or specify what Berlusconi would do there. Berlusconi was sentenced to four years for tax fraud, reduced to one year for a general amnesty. The one-year community service order may eventually be reduced by 45 days…The media mogul is on trial for political corruption in Naples and under investigation in Milan for witness tampering in trials relating to sex-fueled parties at his villa near Milan.
Moelis IPO Offers Founders Riches as Bank Shares Decline (Bloomberg)
Do you want to be buying what Kenneth Moelis is selling? The Wall Street veteran, who has helped companies from HJ Heinz Co. to NYSE Euronext decide the best time to sell, is taking his seven-year-old Moelis & Co. public today. He’s seeking a valuation of as much as $1.58 billion for the New York-based investment bank, while also structuring the sale to ensure he retains control of the firm.
Credit Suisse Value Lags UBS as Dougan Keeps Debt Trading (Bloomberg)
Dougan needs to cut Credit Suisse’s dependence on the investment bank’s fixed-income business, which is volatile and lacks scale, said Kian Abouhossein, a London-based analyst at JPMorgan Chase & Co. He also said the securities unit, which had 19,700 employees at the end of last year, or 100 more than at the end of 2008, should cut its workforce by about 15 percent.
Draghi’s Euro Warning Seen as Cheap Talk by Traders (Bloomberg)
Mario Draghi’s suggestion this weekend that the ECB may ease policy to address the euro’s advance marked a strengthening of a position he’s been setting out for weeks. Yet the 18-nation currency has shrugged off his repeated comments and climbed since the beginning of March, while options traders are about the least bearish on the euro since November 2009.
Why Munich Went Ahead and Set Up 6 Official ‘Urban Naked Zones’ (Atlantic Cities)
Is it OK to walk around naked in the middle of a major city? The idea of seriously debating this question might seem bizarre, but that’s just what the city of Munich has been doing for much of this year. Statewide laws controlling nude sunbathing in Bavaria expired last autumn, and Germany’s third largest city has had to decide for itself whether or not to allow sun-seekers to strip off in public. The answer they came up with is a qualified yes. People in Munich are now officially welcome to go naked provided they restrict themselves to six designated areas across the city. While these areas’ locations in parkland gives them a degree of seclusion, none of them are fenced off or hidden away. One spot is barely ten minutes from Munich’s main square, located along a stream to which tourists flock.