Or at the Justice Department or CFTC or FCA or SFO. Read more »
Nobody Tells The SEC It Can’t Be On The Receiving End Of Valentine’s Day Flowers And Gets Away With ItBy Bess Levin
I don’t know what it’s like at your office, but at the Securities and Exchange Commission, Valentine’s Day is a big deal. Staffers frequently beat suitors off with a stick and on February 14, the deliveries of candy, chocolates, flower arrangements, and edible undies do not stop. So when workers were notified just days before the big day that moving forward, such shipments were banned, there was no way they were going to take the news lying down. Read more »
SEC officials on Thursday told exchanges to work with other market players to come up with “comprehensive action plans” to ensure that the data feeds are resilient, and to ensure the soundness of other “critical infrastructure systems,” according to an SEC statement.
Thursday’s SEC meeting, attended by top executives from exchange operators Nasdaq, NYSE Euronext, BATS Global Markets Inc., Direct Edge Holdings LLC, and others, was marked by one snafu. Nasdaq Chief Executive Robert Greifeld was 40 minutes late due to transportation problems, according to people who attended.
And lest you thought that (slowly outgoing) CFTC Chief Gary Gensler was going to let Mary Jo have all the fun, think again. Read more »
Half of today’s financial news stories are about how some government enforcement agency is looking into something you already knew about. This is very boring for me! Remember when Goldman lost a bunch of money by fat-fingering some options trades?1 That still happened. Remember how JPMorgan did some naughty things with California electricity markets? Those historical circumstances continue to obtain. Remember the Whale? Still a thing.
You could wonder about the substance of some of these investigations. JPMorgan’s electric boogaloo, while intensely naughty, also seems pretty clearly to have followed FERC/ISO rules to the letter, so it’s hard to imagine charging anyone with a crime, as the FBI is apparently contemplating.2 And while I don’t know much about the SEC rules re: electronic options trading, the actual thing that Goldman did was sell options really cheaply, and it would be pretty weird if there were a rule against that, so I don’t know where the SEC is going with its enforcement investigation.3 (The Whale, I’ll give you, that stuff seems bad.) But basically, yeah, sure: bad things happened, rules might have been violated, market safeguards were shown to be less robust than had previously been thought, it is altogether fitting and proper that someone look into it. Or a lot of someones I guess.
Still the stories carry a whiff of looking for the keys under the lamppost: Read more »
Technological ineptitude has kept some civil-servants at the SEC pretty busy this year. And entertained: Without any big-game stock exchanges screwing up lately, they’ll bide their time with one that hosts a whopping 0.4% of all U.S. stock trading. Read more »
Phil Falcone Can Now Devote Himself Full Time To Building A Low-Cost Wireless Network That’s Going To Blow Your MindBy Bess Levin
Remember, back in 2009, when Phil Falcone’s personal accountants realized that the hedge fund manager owed the government more than $100 million in state and federal taxes? And he decided to come up with the cash by “loaning” himself $113 million from a gated investor fund? It’s one of our favorite Falcone stories and we bring it up today because it’s one of the reasons, among many, that the Harbinger Capital founder just agreed to pay the Securities and Exchange Commission $18 million, admit wrongdoing, and take a five year involuntary break from the securities industry. For those who need a refresh, here’s how the idea for Falcone to help himself to the money came about, courtesy of the SEC:
1. After figuring out Falcone was in the hole for over one hundred mill, Phil’s accountants informed Harbinger’s COO, Peter Jenson, of the problem.
2. Jenson made some calls and let his boss know that “no bank would accept Falcone’s hedge fund interests as collateral.”
3. Jenson suggested that Falcone “proceed with appraisals of Falcone’s two Manhattan townhouses and artwork, and raised the possibility of borrowing against other assets, including Falcone’s interest in a National Hockey League team and an estate on the island of St. Barts.”
4. Falcone said nothing but quietly stewed. Borrow against his interest in the Minnesota Wild? He couldn’t believe Jenson had the balls to even mention it. Especially when all that investor money was just sitting there, practically begging to be used… Read more »