A $531 million divorce judgment in a case that has riveted Britain appears poised to stand after the ex-wife of a hedge fund manager said she would not appeal the decision. In late November, a London high court judge ordered Chris Hohn, the hedge fund manager who founded the Children’s Investment Fund, to pay that sum, thought to be the largest divorce award in Britain. At the time, Jamie Cooper-Hohn, Mr. Hohn’s ex-wife, appeared to indicate through her lawyer at a hearing that she might seek more. [Dealbook]
Which was nice of her, in the event the bank is running low on funds and needs to move some assets around/pay a visit to the neighborhood pawn shop/etc. Every day the payment is late, though, interest rates start kicking in and Brady Dougan is paid a visit by a guy named Bunky. Read more »
It’s a great day in Moynihan Land. Read more »
Ed. note: This is a new weekly column by Elie Mystal, Managing Editor of Above the Law Redline, wrapping up the week that was in law and finance. Elie is not a practicing attorney, and anything he says that you listen to can and will be used against you.
Issue #1: The $4.3 billion chat room.
The big news this week is that six firms will pay $4.3 billion to a suite of international regulators in the first set of punishments from rigging the foreign exchange market. Of course, it’s not at all clear that what Forex fixers did was that big of a deal. The Financial Conduct Authority in the U.K. says that “[t]he traders put their own interest ahead of their customers, they manipulated the market — or attempted to manipulate the market — and abused the trust of the public.” That’s lawyer-speak for “that’s not fair.” The fines amount to a $4.3 billion “unsportsmanlike conduct” penalty.
Banks Pledge To Tighten Up Lax Controls That Previously Allowed Employees To “Double Team” Foreign Currency MarketsBy Bess Levin
Traders worked together to “whack” the market, called themselves a “cartell” and congratulated each other for a job well done, according to transcripts released by regulators today. “Ok, i got a lot of euros,” a currency trader at JPMorgan Chase & Co. (JPM) said in an undated 3:51 p.m. message to his counterpart at Citigroup Inc. (C) A minute later he says, “tell you what, lets double team it.” Dozens of chats spanning four years from 2008 and rife with misspellings were released by regulators as they reached the first settlements in the global probe into the manipulation of foreign-exchange benchmarks. Citigroup, JPMorgan, Royal Bank of Scotland Group Plc, HSBC Holdings Plc (HSBA) and UBS (UBSN) AG were ordered to pay about $3.3 billion. The banks said in statements today that they have been working to improve controls and don’t tolerate such behavior…Breaches of client confidentiality and inadequate chat-room supervision are at the heart of regulators’ findings in the foreign exchange probe that commenced over a year ago. [Bloomberg]
The firm, which is accused of lacking the objectivity and integrity expected of consultants but not actually breaking the law, agreed to pay the fine and accept the two-year sidelining of its regulatory consulting unit. PricewaterhouseCoopers appeared to have had little choice: Mr. Lawsky’s office, which has the authority under a little-known New York law to censure erring consultants even without a legal violation, threatened to otherwise inflict a more sweeping and lengthy prohibition…The settlement involves the firm’s work for the Japanese banking giant, which regulators long suspected of routing money through its New York branches on behalf of nations blacklisted by the United States. The bank voluntarily hired PricewaterhouseCoopers in 2007 to quantify its improper transactions with Iran and other sanctioned countries. [Dealbook]
Judge Rakoff would feel a lot better about this if someone from Citi could be compelled to just admit they engaged in fraud; to have them say, “Guilty, your honor.” Sure, the $285 million they’ll be forking over sort of suggests as much on its own but just for fucking once, it’d be nice to hear someone say it. Read more »