JP Morgan Chase and Deutsche Bank are extending bans on the use of multi-dealer online chatrooms, sources familiar with the plans told Reuters, as banks crack down on potentially inappropriate communications following a string of scandals. Chatrooms have been a focus for regulators investigating manipulation of benchmark interest rates and possible rigging in the $5.3 trillion-a-day foreign exchange (FX) market. A source familiar with developments at JP Morgan, the biggest U.S. bank by assets, said the decision was unrelated to the FX probes which surfaced in June, noting chatrooms had been under review at the bank since earlier this year. “This has always been about more than FX,” the source said, adding that the casual nature of online chatrooms increased the potential for “inappropriate” remarks to be made. [Reuters, Related: UBS Making Foreign Exchange Rate Manipulation Mildly More Inconvenient]
JP Morgan Multi-Dealer Chatroom Ban Not Just About FX Manipulation (Innocent Dick Jokes Probably A Problem Too)By Bess Levin
Deutsche Bank Warning To Employees Re: Not Joking About Market Manipulation Would’ve Been More Useful To Robert Wallden Yesterday!By Bess Levin
At the end of October, Deutsche Bank held a town hall on the topic of electronic communication, specifically the perils of making statements re: engaging in fraud, even in jest. To be safe, one should reserve such riffing for face-to-face conversations, or, to avoid headaches in the form of house calls from the FBI, insert some sort of disclaimer in the chat making clear that any talk of breaking the law is not to be taken seriously. Clearly, these are good tips that Deutsche employees will presumably employ moving forward. Unfortunately, they came a bit too late for trader Richard Whalen, who in retrospect would’ve appreciated hearing them before taking part in the “ill-advised” banter that led to this: Read more »
“[Deustche Bank chief Anshu] Jain is a hard-charging investment-banking veteran with a well documented interest in tigers.” [WSJ]
Bloomberg has an absolutely amazing story this morning about political economy and going the extra mile to build a successful business. Specifically it’s about a guy who
- worked as a mortgage banker,
- left to be a senior banking consumer-protection regulator,
- wrote regulations prohibiting big banks from providing certain kinds of mortgages because they were too predatory, and
- then left to start his own company to provide those mortgages.
That’s pretty much the American dream is it not?
The story is unimprovable so go read it; I have exaggerated but only slightly.1 The guy is Raj Date, a former Capital One and Deutsche Bank2 banker who became deputy director of the Consumer Financial Protection Board, wrote rules making it hard for banks to make mortgages that don’t satisfy certain bright-line requirements, and then left to start a company called Fenway Summer LLC that will do what banks can’t: Read more »