Hedge-Fund Founder Arrested Over Neiman Marcus Bankruptcy [WSJ]
Dan Kamensky, the founder of Marble Ridge Capital LP, was arrested Thursday and charged by federal prosecutors in New York with securities fraud, wire fraud, extortion and obstruction of justice in connection with his efforts to acquire shares in Neiman’s MyTheresa e-commerce business…. If convicted of all charges, Mr. Kamensky faces up to 50 years in prison. The Securities and Exchange Commission also sued Mr. Kamensky and Marble Ridge on Thursday….
Payrolls increase by nearly 1.4 million as the unemployment rate tumbles [CNBC]
The unemployment rate was by far the lowest since the coronavirus shutdown in March, according to Labor Department figures released Friday. An alternative measure that includes discouraged workers and those holding part-time jobs for economic reasons also fell, down to 14.2% from 16.5% in July and 22.8% at the peak in April…. Markets rose sharply on the news, with Dow futures pointing to a gain at the open following an aggressive sell-off Thursday.
Malaysia Drops Goldman Sachs Criminal Charges Over 1MDB [WSJ]
In July, Goldman agreed to pay Malaysia $2.5 billion and guaranteed the recovery of $1.4 billion in assets allegedly stolen from the fund as part of efforts by the Wall Street bank to move on from one of the worst scandals in its history. Malaysia agreed to drop criminal proceedings against the bank related to the fund.
A Malaysian court Friday discharged and acquitted three subsidiaries of the bank over their alleged involvement in the scandal…. Goldman is still in discussions with the U.S. Department of Justice for a settlement.
Justice Dept. Plans to File Antitrust Charges Against Google in Coming Weeks [NYT]
Justice Department officials told lawyers involved in the antitrust inquiry into Alphabet, the parent company of Google and YouTube, to wrap up their work by the end of September, according to three of the people. Most of the 40-odd lawyers who had been working on the investigation opposed the deadline. Some said they would not sign the complaint, and several of them left the case this summer.
Some argued this summer in a memo that ran hundreds of pages that they could bring a strong case but needed more time, according to people who described the document…. While there were disagreements about tactics, career lawyers also expressed concerns that Mr. Barr wanted to announce the case in September to take credit for action against a powerful tech company under the Trump administration.
How Options-Market Amateurs Might Have Tripped Up Big Tech [WSJ]
Recently, there has been a jump in the trading volume of options linked to the shares of the top tech giants. While the cost of these derivatives contracts, gauged by their “implied volatility,” almost always moves in tandem with the “realized” volatility of the underlying shares, a rare disconnect has appeared over the past few weeks: Investors pushed up the implied volatility of Nasdaq options even as actual volatility declined…. It is a strategy tailored for uncertain times. However, it can also create feedback loops that affect the underlying assets. Because banks take the other side of these deals, they are left with a downside exposure to stocks, which they then hedge by buying those same shares. The result is a steadier rally, but one that can unravel quickly at the first sign of trouble.
Navarro pushes back on reported workplace behavior: 'If people get in the way ... there will be conflict' [The Hill]
“My mission in this administration is to serve as a soldier for the greatest commander in chief ever, and my job is to help this president do two things: save American lives and create American jobs. And if people get in the way of that, there will be conflict. And I make no bones about that. So this is a tough town,” Navarro said on CNN.
The Washington Post reported that Navarro berated other officials over their policy views, with the article saying young women appeared to suffer the most verbal abuse…. Navarro added that he had “absolutely not” been admonished over his conduct.
Palm Beach Dad Accused of Bribing Kid’s Way Into Georgetown [Bloomberg]
[Investment executive] Amin Khoury agreed in 2014 to pay about $200,000 to Gordon Ernst, then the head coach of men’s and women’s tennis at Georgetown, prosecutors said. Khoury was indicted on a fraud conspiracy count and a bribery count relating to programs that receive federal funds…. Khoury [is] the 40th parent accused in the sprawling case….
The alleged bribery scheme was set in motion after Khoury met with Ernst and an unnamed intermediary at a Brown University reunion event in May of 2014, according to prosecutors. Khoury himself had played tennis for Brown in his college days.
Alex Rodriguez fuming over ‘fixed’ sale of Mets to Steve Cohen, sources say [Thornton/N.Y. Post]
Sources close to the former Yankees slugger say they lost the Queens team on Friday, Aug. 28, after the Mets’ banker — Steve Greenberg of Allen & Co. — reached out to ask for a sneak peek at what was being offered. The request came days ahead of the official Aug. 31 bidding deadline…. The former Yankees third baseman is now convinced that the Mets spoon-fed his bid information to Cohen so the billionaire financier and art collector could have the highest offer and win the team….
The Mets never went back to see if A-Rod wanted to match or better Cohen’s offer, sources said. Rodriguez has been trying to reach Mets owner Fred Wilpon since Friday but can’t get him on the phone, they added.
Billionaire Bill Ackman says market turbulence stems from election and virus uncertainty, stretched tech valuations but isn't 'the beginning of the end' [BI]
"It's certainly not the beginning of the end but I would say we're coming upon one of the more uncertain periods in American history," the founder and CEO of Pershing Square Capital said. "Markets don't like uncertainty…." Ackman said that the divisive presidential election and what it means for the country, corporate America, and taxation, paired with the ongoing coronavirus pandemic, are creating uncertainty within markets. He added that "valuations particularly in the technology landscape have gotten to some pretty extraordinary levels."
Hedge Funds’ Beloved NYC School Ditches In-Class Learning in ’20 [Bloomberg]
Success Academy, the largest charter-school network in New York City, has abandoned its plan to bring students back into the classroom and opted to go fully remote through at least December, the network told families and staff Thursday…. A decision about 2021 will come closer to December…. Many of Success Academy’s schools are co-located inside New York City’s public school buildings, where access has been restricted. The complexity of low-density, in-person learning also proved formidable, making close interactions “very difficult, if not impossible.” New protocols like staggered arrivals also “reduce learning time.”
How To Hide A Billion Dollars: Three Techniques The Ultra-Rich Use To Dodge Ex-Spouses, The Taxman And Disgruntled Business Partners [Forbes]
Quantlab co-founders Bruce Eames (with a 24% stake) and Andrey Omeltchenko (with 4%) are now suing the 81-year-old [co-founder Wilbur “Ed”] Bosarge for fraud. (He denies their claims.) Bosarge is also facing a fraud suit from the founder of a Bahamian stem cell clinic that he funded, took control of and received multiple treatments at—for, he said in a deposition, “bad ankles, bad knees from skiing, muscles that pulled out….” But Bosarge’s most notable current legal battle— for what it shows about the way U.S. state trust laws increasingly protect the rich—is with his wife, Marie, a 66-year-old onetime Marilyn Monroe impersonator Ed married in 1989….
Marie contends she’s owed a billion or more, although she tells Forbes she’d settle for less than $100 million…. Forbes estimates Ed Bosarge is worth at least $1 billion. But as he and his lawyers tell it, the couple’s community property assets total just $25 million since an array of trusts own not only his Quantlab stock, but also their homes in Houston, Aspen, London and Maine and the 72-acre island in the Bahamas where they docked their three (trust-owned) yachts, including the eponymous 180-foot Marie, replete with a baby grand piano. After the divorce papers were served, one of the trusts even repossessed a $1.9 million (purchase price) diamond necklace which Marie says Ed gave her as a Christmas present in 2009. “That wasn’t a gift; that was specifically bought by the trust. It was a specific investment,’’ Ed insisted in a deposition last year.