Posted by Larry Doyle on February 24th, 2010 2:39 PM |
You can rest assured that the powers that be on Wall Street would just as soon have the Madoff saga over. The Madoff scam perpetrated on investors is an ugly reminder of the non-existent financial regulatory system during the better part of the last twenty years.
I also believe many in Washington also might like to see the Madoff saga quietly pass by. The failures of the SEC, FINRA, and SIPC in this greatest of scams are an ugly reminder of the Wall Street-Washington incest.
Well, while many of the incestuous partners would like to turn the page, there remains a lot of filth that still needs to be cleaned up and a lot of individuals and institutions that need to be held to account. (more…)
Posted by Larry Doyle on February 20th, 2010 11:58 AM |
The target on SEC Chair Mary Schapiro’s back is getting larger and gaining more focus. How so?
The lead editorial in this weekend’s edition of The Wall Street Journal goes after Schapiro hard in writing, Mary Schapiro’s Say on Pay. While the editorial leads with the ongoing battle Schapiro and the SEC are having with Bank of America’s lack of disclosure during its merger with Merrill Lynch, the Journal quickly turns the tables on Ms. Schapiro and addresses the lack of disclosure at Ms. Schapiro’s former haunt, FINRA.
Come to papa.
Regular readers of Sense on Cents are well aware of how consistently and steadily I have been banging this FINRA drum. It is long past due that America is truly introduced to Wall Street’s self-regulatory organization, the Financial Industry Regulatory Authority (FINRA). (more…)
Posted by Larry Doyle on January 29th, 2010 8:31 AM |
The policies implemented in Washington are trying to buy time in hopes that our economy recovers. Japan took the ‘buying time’ approach and twenty years later they are still waiting for real recovery.
The approach being taken by those within our financial regulatory structure (SEC and FINRA) is to ‘move forward.’ Well, unless the critically unanswered questions and issues embedded within these organizations are fully exposed and addressed, America can never truly move forward with confidence in the markets and those overseeing them.
President Obama wants real financial regulatory reform. Then Mister President, compel your chair of the SEC, Mary Schapiro, to open the books and records of FINRA. Mr. President, compel Ms. Schapiro to unseal documents regarding the very formation of FINRA itself.
America knows something still smells on Wall Street. What is it? (more…)
Posted by Larry Doyle on January 22nd, 2010 10:14 AM |
Add Peter Sivere to the list of people totally screwed by the Wall Street-Washington incest.
The incestuous nature of the Wall Street-Washington relationship runs across many segments of our financial landscape. That said, the corrosive nature of this incest is most egregious within those institutions charged with protecting investors, that is the SEC and FINRA.
The SEC and FINRA failed the Madoff investors, the Stanford investors, and ultimately the country as a whole. I firmly believe the financial regulatory system failed to perform because it was in bed with the industry and served at its behest. To what extent are the regulators still in bed with the industry? (more…)
Posted by Larry Doyle on January 4th, 2010 12:04 PM |
Will the change in the calendar bring about change in the prospects for real financial regulatory reform? Will Wall Street and Washington recycle the streamers and party hats used for New Year’s Eve celebrations and declare that the market is up so all is well? If the general media allows the charlatans in Washington and their consorts on Wall Street to frame the regulatory reform debate, America should expect little to no change on this front. In the process, a tremendous opportunity will have been squandered and real risks for our collective future will remain.
The haggling over regulatory turf continues again with Ben Bernanke’s declaration yesterday that our housing crisis resulted not from excessively easy monetary policy but rather lax regulatory oversight of mortgage lending. Whose domain is that to regulate? Oh right, that is the charge of the Federal Reserve. The joke on the American public continues, given that Bernanke is not called on the carpet for that sort of grandstanding. (more…)
Posted by Larry Doyle on November 18th, 2009 12:45 PM |
Should we take heart that the Obama administration is creating a multi-agency Financial Fraud Task Force? While there is no doubt there are massive frauds in the system, the mere creation of a task force does not necessarily mean the frauds will be rooted out. Why? If the agencies involved in the task force are themselves fundamentally and structurally flawed, then frauds will continue. If the agencies merely failed to execute or perform then perhaps this task force will expose those deficiencies and lessen fraudulent activities.
Which agencies will be involved in this task force? The Securities Industry News reports, U.S. Launches Multi-Agency Task Force to Prosecute Financial Fraud:
The task force will be led by the Department of Justice and chaired by Attorney General Eric Holder Jr., but will also include senior officials from the Department of Treasury, the Securities and Exchange Commission, the Commodity Futures Trading Commission, the Federal Reserve System and other major federal agencies.
Thus, this task force would seem to consist of all government agencies while being led by AG Eric Holder and the Department of Justice. What does Mr. holder have to say? (more…)
Posted by Larry Doyle on October 23rd, 2009 1:19 PM |
The drive for transparency in our financial regulatory system is gaining momentum. How so?
The complaint brought on behalf of Standard Investment Chartered v FINRA, NYSE Group, Mary Schapiro et al is receiving increased interest. As well it should. Why? As I have always maintained, for confidence to return to our markets and economy, it is imperative that we have transparency in our financial regulators and regulation.
In regard to this case, I wrote a Letter to Judge Jed Rakoff in re: Benchmark and Standard Investment Chartered v. FINRA on Thursday October 15th. I wrote:
. . . having attended the hearing in your chambers on October 6th on the above referenced case (I was the only member of the public or the press in attendance), I would request that you release unredacted documents pertaining to these complaints. The release of those unredacted documents would be of real public service. That service entails the ongoing public cry for real transparency in our financial industry at this time. That cry for so many of our citizens seems to go unheeded all too often. I could share dozens of comments left at my site echoing that cry.
I truly believe if a real measure of confidence in our markets and our economy is to return, it must be based on true transparency and integrity. While I have written extensively on the lack of transparency and integrity in our country, I don’t pretend to think that my site will change the landscape on this front immediately. That said, I am never discouraged to continue digging deeper, writing more, and asking the hard questions. On this front, I sincerely hope the adjudication of this case will highlight these qualities for all to see.
Barrons actually beat me to the punch and had requested a release of the same unredacted documents in a communication sent to Judge Rakoff on October 5th. Those interested in Barron’s request written by Jim McTague, the Washington D.C. editor, can access it here.
Today I learn that The New York Times is making the same request of FINRA. Stephen Labaton, senior writer for The New York Times in Washington D. C., made his request of Judge Rakoff this past Wednesday, October 21st. Those interested in the NYT request can access it here.
The drive for transparency in our financial regulatory system continues. With Barrons and The New York Times on board, that drive is gaining steam.
The American public deserves nothing less than total transparency and integrity in its markets, regulations, and regulators.
Related Sense on Cents Commentary:
Nasdaq Sale: Why Would Schapiro and FINRA Execs Lie? (October 22, 2009)
Attorney Richard Greenfield Brands Mary Schapiro and FINRA Execs as “Liars” (October 19, 2009)
Posted by Larry Doyle on October 12th, 2009 12:29 PM |
Is it possible for an industry to accrue trillions in losses and nary an individual forced to truly ‘face the music?’ That reality, perhaps more than any other, is the greatest indictment of the incestuous relationship between Wall Street and its regulatory oversight in the form of the SEC and FINRA.
The music is about to start playing as Bear Stearns hedge fund managers Ralph Cioffi and Matthew Tannin enter court this week for the start of their trial in which they are accused of misrepresenting the health of their two hedge funds at Bear Stearns.
This trial will attract a tremendous amount of attention. Why? The very fact that it is truly the first legitimate legal proceeding linked to the meltdown of our financial crisis. The trial will highlight incriminating statements and e-mails written by both Cioffi and Tannin. Additionally, we should expect the prosecution to present material which highlights the fact that Cioffi and Tannin seemed to intentionally misrepresent the very nature of their investment holdings.
The Wall Street Journal provides further color on this case in writing, A Case Pitting Spin Against Fraud:
A criminal trial involving two former Bear Stearns executives could help answer a key question stemming from the financial crisis: How far can Wall Street firms go to put a positive spin on bad news?
The two executives, Ralph Cioffi and Matthew Tannin, will fight securities-fraud charges in a widely anticipated trial beginning on Tuesday in a Brooklyn, N.Y., federal court. The money managers unsuccessfully scrambled to keep two mortgage-heavy Bear Stearns hedge funds afloat in 2007 amid sinking mortgage-market prices, the first of several blows that eventually felled Bear Stearns and marked the start of the credit crisis. J.P. Morgan Chase & Co. bought the firm in a March 2008 fire sale.
Prosecutors accused Messrs. Cioffi and Tannin of misleading investors about the health of the two funds, testing the degree to which Wall Street should disclose bad news to investors. (more…)
Posted by Larry Doyle on September 15th, 2009 3:23 PM |
On the heels of President Obama’s speech on Wall Street in which he called for meaningful financial regulatory reform, I welcome submitting to him and the American public the following video clips. These clips are from Fox Business News “America’s Nightly Scoreboard” with David Asman on September 3rd.
While President Obama and Congress may believe financial regulatory reform needs to focus on the SEC, the Federal Reserve and assorted other governmental agencies, I would remind the President and his Congressional colleagues that Wall Street is regulated not only by the SEC but to a great extent by the self-regulatory organization known as FINRA (Financial Industry Regulatory Authority).
This discussion on “America’s Nightly Scoreboard” is separated into two parts.
Highlights from the videos include:
1. Richard Greenfield, an attorney representing Amerivet Securities, makes the claim that FINRA under the leadership of Mary Schapiro failed to protect investors.
2. Former SEC chair Harvey Pitt defends Shapiro and FINRA
3. Greenfield indicates that a FINRA insider claims FINRA invested in Madoff!!
4. In Part II of the video clips, your host here at Sense on Cents joins the panel and provides details as to why FINRA, via its parent the NASD, did have responsibility to oversee Madoff. I also comment on the nature of the relationship between Wall Street and Washington, FINRA’s investment and timely liquidation of its Auction-Rate Securities position, and the need for total transparency at FINRA.
4. Head of the Madoff Victims Coalition for Investor Protection, Ronnie Sue Ambrosino, weighs in that the entire regulatory structure from the SEC to FINRA to SIPC (Securities Investor Protection Corporation) have failed to protect investors.
In my humble opinion, the conclusion of this show highlights the screaming need for FINRA to open its books and records for a full and thorough independent analysis and review. In so doing, hopefully investors specifically and the American public at large can regain a degree of confidence in the badly shattered Wall Street regulatory process.
If you care about the markets and our country, I beseech you to watch this 18 minute video in its entirety.
Thoughts, comments, questions always welcome and appreciated.