Cynk Suspended by SEC After No-Member Network’s Surge (Bloomberg)
Cynk Technology Corp., the supposed operator of a social network that caught the attention of the financial world with its skyrocketing stock price, was suspended from trading by the U.S. Securities and Exchange Commission. The halt is because of “concerns regarding the accuracy and adequacy of information in the marketplace and potentially manipulative transactions in CYNK’s common stock,” the SEC said today on its website. Judith Burns, a spokeswoman for the agency, declined to comment further. Cynk’s social network appears to have no members, no revenue, no assets and only one employee. The stock-price chart has been the talk of all manner of business blogs and Twitter pundits, from Business Insider to the Wall Street Journal and Zero Hedge, which has called Cynk’s moves “pure madness.”
Wells Fargo’s Profit Edges Up (WSJ)
Wells Fargo reported net income of $5.73 billion, compared with $5.52 billion a year earlier. Per-share earnings, reflecting the payment of preferred dividends, were $1.01 versus 98 cents a year earlier. Revenue slipped 1.5% to $21.07 billion. Analysts polled by Thomson Reuters expected per-share earnings of $1.01 on revenue of $20.84 billion.
Ex-Merrill Lynch Banker Uses Big Data to Save U.K. Pubs (Bloomberg)
The Oxford-educated Bulkin, 37, spent 15 years cutting deals as a mergers & acquisitions banker for Merrill Lynch and Lazard Ltd. before leaving last year to start his own pub company, Hawthorn Leisure Ltd. He’s acquired hundreds of struggling pubs and plans to turn them around by tracking everything from the price charged for beer to daily sales fluctuations to customers’ drink preferences. “Understanding pricing and the mix of drinks is incredibly important,” Bulkin says in an office overlooking Hyde Park in London’s upscale Mayfair district. “A lot of pubs don’t have that data. If you can make them the core of your business, there’s a fantastic opportunity.”
London Seeks New Spenders as Russians Skip $719 Champagne (Bloomberg)
To gauge London’s place in the global economy, you could examine World Bank statistics, canvass investors and analyze trade volumes. Or you could visit Mahiki, a Polynesian-themed nightclub in upmarket Mayfair where a bottle of Cristal Champagne goes for $719 — and Russian customers are being supplanted by revelers from countries including China and Nigeria. “We’re seeing a lot less Russian surnames on the booking sheet,” said Michael Evans, the creative director of the club, where the likes of Rihanna and Prince Harry have been spotted after dark. “It’s very easy to see what’s going on in the world from the markets we attract.”
Rajaratnam acquittal shows indirect insider trading case challenge (Reuters)
The acquittal on Tuesday of the younger brother of convicted hedge fund titan Raj Rajaratnam suggests prosecutors will have a tougher time pursuing people accused of trading on inside information they received indirectly. Roughly a third of the insider trader defendants charged by Manhattan U.S. Attorney Preet Bharara since 2009 are alleged so-called “remote tippees”. According to prosecutors, in such cases the defendant, or “tippee,” never directly talks to the insider, instead getting information from an intermediary. After the case of former Galleon Group fund manager Rengan Rajaratnam, prosecutors may reevaluate how they build similar cases, said James Cox, a law professor at Duke University.
Gym Teacher, Suspended For Twerking With Students (HP)
Courtney Spruill, who teaches history and PE at Kernan Middle School in Jacksonville was suspended for 15 days without pay on July 1. The tush-shaking tips allegedly occurred in May during a party for the girls’ soccer team that took place at the house of one of the players. Spruill is the team coach. Witnesses at the party told Duval County School Board investigators they saw Spruill drinking vodka and twerking on the players. Investigators also say they reviewed a cellphone video of Spruill getting a lap dance from a student at the party, WPTV TV reports.
Can Puerto Rico Keep the Lights On? (BusinessWeek)
The Puerto Rico Electric Power Authority, which provides almost all the island’s electricity, may have to choose between paying bondholders and keeping the lights on, Marxuach says. The utility, which carries $8.6 billion in debt, has negotiated with creditors to postpone to July 31 repayment of bank loans due during the month. Prepa, as the agency is known, may have to resort to rolling blackouts in residential areas so hospitals, schools, and businesses can function, Marxuach says. That would “bring home to a lot of people the magnitude of the crisis we’re going through,” he says. In a statement, Juan Alicea Flores, Prepa’s executive director, said: “Prepa will continue to produce and deliver power.”
Despite Exposure of Madoff Fraud, New Ponzi Schemes Emerge (Dealbook)
“Every other day, you see new schemes uncovered that involve big dollar amounts,” said Jordan D. Maglich, a Tampa, Fla., lawyer who follows Ponzi schemes. He started ponzitracker.com in 2009 after working with his law firm to help recover the $350 million that a Sarasota, Fla., hedge fund manager, Arthur G. Nadel, defrauded from investors, and realized there was no central point of information on such frauds. Over the last five years, Mr. Maglich said, he has followed about 500 Ponzi schemes on his site.
ECB Eyes Risks of Use of Computer-Based Forex Trading (WSJ)
ECB officials and commercial currencies bankers met at an ECB-hosted contact group July 7, and discussed whether banks’ technology can cope with a jump in demand from investors to execute orders algorithmically rather than over the phone, according to a person familiar with the matter. They also discussed whether this change will cause an increase in banks’ technology costs. “Those methods have the beauty of a smoother execution. But there are two issues: is the banks’ infrastructure robust enough to cope with the increase in demand? And can the also machine break or misbehave leaving a bug in the software?” the person said. It is the first time in recent meetings that the issue has taken center stage in the discussion.
British banks paying $2 billion for swaps mis-selling: regulator (Reuters)
Britain’s banks are in the process of paying out 1.2 billion pounds ($2 billion) to compensate small businesses that were mis-sold complex interest rate hedging products, data from the UK financial watchdog showed on Friday. The figure represents about a third of the 3.75 billion pounds set aside by Britain’s four biggest banks – Barclays (BARC.L), HSBC (HSBA.L), Lloyds Banking Group (LLOY.L) and Royal Bank of Scotland (RBS.L) – to deal with the issue.
Cops: Woman Stripped, Did Yoga In Roadway (TSG)
Michele Cernak, 51, was collared on a variety of drug counts after police responded to a 911 call about an intoxicated woman stripping off her clothes on an Ocala street. When officers confronted the Ocala resident, her pants were at her ankles (though she still had “pant!es covering her private area,” cops noted). Witnesses told officers that Cernak had been doing yoga poses. Cernak was exercising about ten feet from her truck, which had its driver’s door open. A search of the vehicle turned up heroin and drug paraphernalia, according to an Ocala Police Department report.