Wall Street Moles Go to New York’s Top Cop, Spurning SEC Cash (Bloomberg)
A tip that helped spur New York Attorney General Eric Schneiderman’s June lawsuit against Barclays Plc was first shopped to the SEC, as was another that triggered his investigation into a controversial trading practice at BlackRock Inc., said people with direct knowledge of the matter. By going to Schneiderman, informants risk hurting their chances of collecting as much money as possible from the SEC. The SEC, responding to its failures to police Wall Street before the 2008 credit crunch, tried to improve its bounty program with input from the Internal Revenue Service and other government agencies that have long paid whistle-blowers. While the overhaul benefited from congressional approval to offer bigger rewards in a wider swath of cases, informants say they’re frustrated by the SEC’s slow process.
U.S. Prosecutor Masterminded $37 Billion Bank Penalty Win (Bloomberg)
Geoffrey Graber, the 41-year-old Justice Department attorney tasked with holding Wall Street accountable for the financial crisis, has a message for his prosecutors: Always be closing. In the past year, Graber has won almost $37 billion in penalties from some of the world’s largest banks, a record haul for prosecutors. To colleagues, he compares his job to that of Blake, the notorious motivational speaker played by Alec Baldwin in David Mamet’s 1992 film Glengarry Glen Ross, who chastises real estate salesmen for failing to lock in deals. “My role was to identify the most promising cases and accelerate those,” Graber said in an interview. “We’ve done our best to put a short fuse on this.”
Pimco’s outflow headaches only just beginning (Reuters)
Pimco hasn’t said how much money has been withdrawn since fund manager Bill Gross quit on Sept. 26 to join Janus Capital. Pimco said its Total Return fund, which Gross had personally managed for 27 years, saw $23.5 billion in withdrawals in September. Morningstar, which analyzes mutual funds and other investments, estimated net outflow from Total Return at $17.9 billion in September, part of $25.5 billion of net outflows across all of Pimco’s U.S. open-ended funds in September…Outflows “will tend to be elevated over the next few months” said Jeff Tjornehoj, head of Americas research at Lipper, a Thomson Reuters company, who said Gross’s exit is “the last straw” for some institutional investors. Those “investors are going from the wait-and-see when Bill was there to ‘let’s accelerate this'” outflow, he said.
What, Me Retire? Bill Gross Speaks on Life After Pimco (BusinessWeek)
Bill Gross, co-founder of Pacific Investment Management Co., didn’t consider retirement a serious option, even after he realized recently that he’d be leaving the company he spent decades building. That’s what Gross, 70, told InvestmentNews, a trade magazine for financial advisers, in an interview published on Monday morning. “You know those adages about smelling the roses and chasing butterflies?” he said. “The markets are my butterflies and my roses. When I go to work Monday, I’ll be smelling the roses.”
Hot air balloon dips into Pacific Ocean, 3 rescued (AP)
KNSD-TV reports a man was proposing to his girlfriend during their sunset ride Sunday when the balloon drifted off course and hovered over the water off Cardiff by the Sea. Many people watched as the balloon drifted toward the beach in northern San Diego county and dipped into the water. Eric Barretto told the station he and his fiancee threw a rope to the water below and several surfers pulled the balloon back to shore. A witness told U-T San Diego the pilot stayed with the balloon and kept it inflated while it was tugged onto the beach. Read more »
$$$ Bill Gross Speaks on Life After Pimco [BusinessWeek]
$$$ The 32-year-old Utah man was in a Mexican restaurant early yesterday morning when he asked an employee if he could borrow a pen “to get a get a girl’s phone number.” But when the Beto’s Restaurant worker declined Davis’s request, a verbal argument ensued inside the Salt Lake City eatery. During the 2:45 AM dispute, Davis slapped the victim’s finger away from his face, prompting the employee to try and escort Davis from the restaurant. Davis, however, “pulled a knife and stabbed the victim in the leg then again in the abdomen/rib area,” according to a Salt Lake County Sheriff’s Office report. [TSG] Read more »
This is Fox Business’s Senior Women’s Clothing Store Correspondent, reporting live: Read more »
“I’m in it to whip the pants off anybody competing on the same football field.” [InvestmentNews]
Point72 Asset Management Adds Another Layer Of “Accountability” Between Steve Cohen And Would-Be Insider TradersBy Bess Levin
Billionaire Steven A. Cohen is reorganizing the equities business of his Point72 Asset Management investment firm into seven units to improve accountability. The seven units, organized along industry and geography lines, will each be run by a sector executive, according to a memo sent to employees today from Point72 President Douglas Haynes. The executives will supervise all money managers within their unit and be assisted by a sector executive officer overseeing the group’s analysts, the memo said. Each unit will have officers overseeing compliance, risk and research. The changes are effective immediately. [Bloomberg]
F.B.I. Agents Took Inspiration From I Know What You Did Last Summer In SAC Capital Insider Trading CaseBy Bess Levin
Over at the New Yorker today, you will find a long piece exploring the coming undone of the hedge fund formerly known as SAC Capital, now Point72 Asset Management, at the hands of a trader formerly known as Ajai Thomas, now Mathew Martoma. Although nearly a dozen ex-SAC employees have been charged with and convicted of securities fraud over the last several years, it was really the work of work of Martoma, accused in November 2012 of orchestrating “the largest insider trading scheme ever” and found guilty last spring, that was the straw that broke the embalmed shark’s back. Particular details to note:
* While SAC has a history as an extremely cutthroat place to work, where the “down and out” clause means traders are cut loose swiftly and without hesitation, and insults from on high are in no short supply, it was no match for the household of Martoma’s youth, headed by a guy who could teach Steve Cohen a thing or two.
When Martoma’s father first came to America, he was admitted to M.I.T., but he could not afford to attend. He retained a fascination with Cambridge, however, and prayed daily that his oldest son would go to Harvard. Martoma graduated from high school as co-valedictorian, but he ended up going to Duke. Shortly after Mathew’s eighteenth birthday, Bobby presented him with a plaque inscribed with the words “Son Who Shattered His Father’s Dream.”
* Steve Cohen has continued his long and storied tradition of displaying once-living things in boxes at the 72 Cummings Point Road headquarters.
S.A.C. was a notoriously intense place to work. Its headquarters, on a spit of land in Stamford, Connecticut, overlooking the Long Island Sound, are decorated with art from Cohen’s personal collection, including “Self,” a refrigerated glass cube, by Marc Quinn, containing a disembodied head sculpted from the artist’s frozen blood.
* That anecdote that circulating a while back about how Martoma had fainted on his front lawn when approached by the Feds? It wasn’t the mere sight of them, or some sort of line about how they knew he’d been trading on material non-public information that caused him to collapse, but rather this: Read more »
Unfortunately for the IKOS Asset Management co-founder and quant (if not husband) extraordinaire, it’s not ready and those losses are mounting rapidly. Read more »