Wells Fargo’s CEO to Face Senate Panel in Cross-Selling Scandal (Bloomberg)
The Senate Banking Committee plans to hold a hearing Sept. 20 on Wells Fargo, following last week’s enforcement case in which regulators accused bank employees of opening deposit and credit-card accounts without customer approval to meet sales goals. Stumpf is among executives who’ve been asked to appear, a spokeswoman for the committee said Monday.
Wells Fargo to Eliminate Product Sales Goals, Aiming to Rebuild Trust (WSJ)
Wells Fargo & Co. said it will eliminate all product sales goals in its retail banking operations in January as it works to rebuild trust after allegedly allowing its employees to open accounts without customers’ knowledge to meet targets. Wells Fargo has faced a public and political storm after last week’s agreement with regulators alleged practices that included employees creating as many as two million deposit and credit-card accounts without customers’ knowledge. The bank, which paid a record-setting $185 million settlement, didn’t admit or deny wrongdoing.
Berkshire Accused of ‘Siphoning’ Funds in Workers’ Comp Suit (Bloomberg)
In the lawsuit, Breakaway Courier Corp. accused Omaha, Nebraska-based Berkshire of creating what it called a “reverse Ponzi scheme” that requires workers’ compensation customers to cover each other’s losses. According to the complaint in state court in New York, companies are led to believe their premiums are being paid into “protected cells” and will eventually be returned to them.
Divided Fed Inclined to Hold Rates Steady (WSJ)
It is a close call. But with inflation holding below the Fed’s 2% target and the unemployment rate little changed in recent months, senior officials feel little sense of urgency about moving and an inclination toward delay, according to their public comments and recent interviews.
Goldman team uses retail deposits for Wall Street-style profits (Reuters)
Led by 40-year-old Goldman partner and credit trading veteran Gerald Ouderkirk, the team's job is to use consumer deposits and other types of funding for trades, investments and big loans to earn profits, people familiar with the matter told Reuters. The existence of the team, which has not been previously reported, was set up in mid-2015 and is formally known as the institutional lending group. Lately, it has ramped up activities as Goldman Sachs looks to do more lending broadly. Some Goldman executives bristle at the idea that Ouderkirk's team is similar to chief investment offices, or CIOs, at bigger banks such as JPMorgan Chase & Co (JPM.N) and Bank of America Corp (BAC.N), since Chief Financial Officer Harvey Schwartz and Treasurer Robin Vince still manage the bank's day-to-day liquidity, including how much capital Ouderkirk gets to work with.
Japanese minister slammed for getting piggyback over puddle in town where 21 people died in typhoon (Mirror)
Senior government official Shunsuke Mutai hitched a ride on a colleague's back during a visit to Iwaizumi, where Typhoon Lionrock killed 21 people. The vice-minister of reconstruction was seen on TV laughing and smiling as he was piggybacked by a less senior official so that his feet didn't get wet in the storm-ravaged town. Mr Mutai later apologised, saying what he did was "inappropriate" and that he "deeply regretted it".
High Frequency Traders Elbow Their Way Into the Currency Markets (Bloomberg)
Algorithmic traders have more than tripled foreign-exchange volumes over the last three years, seizing opportunities as Wall Street banks withdraw from currency dealing, according to Aite Group, a consultant in Boston. The new group of market makers is trading almost $200 billion a day. While that may seem small in the context of the sprawling global currency market, consider this for perspective: Stock trading on all U.S. exchanges totals about $270 billion a day.
Wall Street’s Insatiable Lust: Data, Data, Data (WSJ)
Data hunters scour the business world for companies that have data useful for predicting the stock prices of other companies. For instance, a company that processes transactions at stores could have market-moving information on how certain products or brands are selling or a company that provides software to hospitals could give insights into how specific medical devices are being used. Gone are the days when a hedge fund would call up a random sampling of Aéropostale stores to ask managers about sales or simply visit big-box retailers to get a feel for the traffic.
Former AIG chief Hank Greenberg finally goes on trial (Reuters)
Opening arguments are set to begin on Tuesday in the trial of former American International Group Inc chairman Maurice "Hank" Greenberg over accounting fraud at the insurance giant some 16 years ago. Greenberg, 91, is facing civil charges of orchestrating a $500 million transaction to conceal the insurer's financial difficulties from shareholders. He is expected to testify during the trial. The case, filed by then-New York Attorney General Eliot Spitzer in 2005 and which also names former AIG chief financial officer Howard Smith as a defendant, did not go to trial for more than a decade, thanks to legal wrangling that twice made its way to the Court of Appeals, the state's highest court.
Catfish Falls From The Sky, Hits Woman In The Face (HP)
A Philadelphia woman says she was knocked to the ground when a 5-pound catfish fell from the sky and struck her in the face. Lisa Lobree was on her way to a Labor Day exercise class near the Philadelphia Museum of Art when she was suddenly “slammed by something,” Lobree told the Philadelphia Enquirer. “I was like, ‘What!?’ I was freaking out,” she recalled. Several news outlets suggested that the 16-inch catfish fell from the grasp of a bird flying in the sky above. Lobree suffered a small cut under her left eye and some swelling from the flying fish. She was also hit with a distinct odor. “I smelled so bad afterwards,” she told CBS Philadelphia. “I smelled disgusting.”