Tag Archive | "investigation"

Write-Offs: 05.23.11

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$$$ Spain and Italy Turn Against Greece Over Reform Efforts (NYT)

$$$ Dominique Strauss-Kahn told the New York hotel maid, “Don’t you know who I am! Don’t you know who I am?” while pinning her down during the alleged sexual assault, law enforcement sources close to the investigation told FoxNews.com…“Please stop. I need my job, I can’t lose my job, don’t do this. I will lose my job. Please, please stop! Please stop!” she told Strauss-Kahn, according to law enforcement sources. Strauss-Kahn allegedly responded: “No, baby. Don’t worry, you’re not going to lose your job. Please, baby, don’t worry,” Strauss-Kahn responded, according to investigators. (Fox)

$$$ Belgium’s Debt Outlook Revised to Negative by Fitch on Political Stalemate (Bloomberg)

$$$ ‘Fear Gauge‘ Tops 20 for First Time in Two Months (WSJ)

$$$ How An Inquiry Of Goldman Might Play Out (Dealbook)

$$$ LinkedIn site has security vulnerabilities-expert (Reuters via Easy Street/Heidi Moore)

$$$ David Stockman: “The real problem is the de facto policy of both parties is default. When the Republicans say no tax increases, they’re saying we want the U.S. government to default. Because there isn’t enough political will in this country to solve the problem even halfway on spending cuts. When the Democrats say you can’t touch Social Security, when you have Obama sponsoring a war budget for defense that is even bigger than Bush, then I say the policy of the White House is default as well.” (YouTube)

$$$ AIG Underwriters Signal Deal May Price at Close to $30 (CNBC)

$$$ Walker: US Worse Off Financially Than Euro Nations (CNBC)

$$$ Greece to start selling domestic assets to ease debts (BBC)

$$$ More banks targeted in US probe (FT)

$$$ Carlyle Returns Record $6.4 Billion in First Quarter on Strong Dealmaking (Bloomberg)

$$$ Former Fed Monetary Chief Madigan Hired by Barclays Capital (Bloomberg)

$$$ Steven Cohen wants a five-year-old stock manipulation lawsuit filed by Canadian insurer Fairfax Financial Holdings to go away. (Reuters/Unstructured Finance)

$$$ Hintz Says Smith Barney Is ‘Checkmated’ by Krawcheck, McCann (Bloomberg)

$$$ China’s Buffett plays the long game (FT)

$$$ Senate Banking chair Tim Johnson discusses hedge funds [AR]

$$$ IBM passes Microsoft’s market cap after 15 years (Reuters)

$$$ Lady Gaga Breaks Amazon (MarketBeat)

$$$ Barack Obama’s car, nicknamed ‘the beast‘, gets stuck (BBC)



Article courtesy of Dealbreaker

Write-Offs: 03.04.11

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$$$ “On Friday, prosecutors also gave a preview of their case against Raj Rajaratnam, saying the first two witnesses will be a Federal Bureau of Investigation agent and Anil Kumar, a former McKinsey consultant and a cooperating witness in the case. Prosecutors indicated that they planned to play recorded telephone conversations between Mr. Rajaratnam and Mr. Kumar, as well as conversations between Mr. Rajaratnam and his employees and with his younger brother, Rengan Rajaratnam.” [WSJ]

$$$ Completely unimaginative UBS employee spends investor funds on “expensive cars, prostitutes and large gambling debts.” [WSJ]

$$$ “Our industry has a terrible, terrible reputation,” Anthony Scaramucci said as he accepted an award from the Hedge Funds Care charity Thursday night in front of 1,200 of his closest friends and expressed why he believes hedge fund managers should donate to charities. “I don’t care how many PR firms we hire. I don’t care how many lobbyists we hire. The only way we’re going to be able to change that is through our philanthropy,” he told the industry audience, at the annual gala at Cipriani 42nd Street in Manhattan. [Reuters]

$$$ Charlie Sheen Radio Station, Tiger Blood Radio, By Sirus XM [HP]

$$$ Rick Santelli: ‘Good’ Jobs Report Has Dark Side [CNBC]

$$$ Signs You’re About To Get Fired [USNEWS]

$$$ DJ Mr. Chachi, who spins regularly at the night club Tenjune and has worked for Hedge Funds Care free for the past four years, turns down the volume. Honoree Anthony Scaramucci, managing partner of Skybridge Capital LLC, is clinking his glass to quiet the crowd. “This is bigger than my bar mitzvah back in 1978,” he says. [Bloomberg]



Article courtesy of Dealbreaker

Eavesdropping In: Biggie’s Murder Case Reopened; Moronic Thief Calls Cops On Himself; "Entourage" Update!; Jon Stewart Slams Facebook;…

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Authorities reopen the investigation into the 13-year-old cold case L.A. murder of Notorious B.I.G. [PE]
In what might be one of the dumbest moves in the history of stupid, a CA man who had just pilfered a computer from Walmart walks back into the store to report his car stolen to [...]

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Morgan Stanley Guy Who Committed Hit And Run Provides Pretty Legit Excuse For Faux Pas

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Back in November, it was reported that last summer, Morgan Stanley financial adviser Martin Joel Erzinger, pictured, had driven over a doctor who was on his bike and then kept going, “until he reached a Pizza Hut parking lot, where he stopped and called Mercedes auto assistance to report the damage to his vehicle.” Dr. Steven Milo suffered damage to his knees and scapula, spinal cord injuries, bleeding to the brain, in addition to ‘disabling’ headaches and the possibility of multiple surgeries. The part of the story that was somewhat more shocking was that rather than be slapped with serious to quite serious charges, a court decided that for his crime, MJE would be hit with two misdemeanour traffic violations and restitution to the victim. People were somewhat outraged, to say the least. But! That was prior to hearing all of Marty’s side of the story.

“New-car smell” might have contributed to a driver losing consciousness in a July hit-and-run accident, his lawyers claim. Martin Erzinger was driving a new 2010 Mercedes sedan when he rear-ended bicyclist Dr. Steven Milo, about 1:30 p.m. July 3.

Erzinger’s attorneys say their client suffers from sleep apnea and fell asleep at the wheel before driving off U.S. Highway 6 and onto the shoulder near Miller Ranch Road, hitting Milo, who sustained injuries, from behind. Erzinger had purchased the car about a month before the accident. Accident reconstructionist John Koziol found in his investigation the sedan was emitting new car fumes, court documents said. It might have been a contributing factor, documents said.

Now, who feels like they judged too soon?

New Car Smell Cited In Hit And Run Case [DP]



Article courtesy of Dealbreaker

The Securities And Exchange Commission’s Resident Tranny Porn Lover May Be In Trubs Again

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Last February, an unnamed Securities and Exchange Commission worker got in a bit of trouble with his employer for checking out a little porn while on the job. The guy made at least 1,800 logged attempts to check out some sites that included www.ladyboyx.com, www.ladyboyjuice.com, www.trannytit.com, and www.anal-sins.com, which, he admitted, “were kind of distraction per se.” But he had a good reason which is that he had a lot of work to do, and it was stressing him out.

Now it seems that the tranny tits were in fact not just “kind of” a distraction, “per se,” but a “huge ass” distraction. In SEC Inspector General David Kotz’s latest semi-annual report, released Monday, it is disclosed that the watchdog is close to wrapping up an investigation into whether or not “a senior-level official” directed staff not to go after red flags in an investment adviser case in order to cover his own hide, which had previously investigated the firm and failed to uncover the fraud, possibly as a result of spending too much time surfing for lady boy juice at work.

Complaint of Failure of an SEC Regional Office to Uncover Fraud and Inappropriate Conduct on the Part of a Senior-Level Official

In March 2010, the OIG received an anonymous complaint alleging that a senior-level official in the investment adviser examination program at an SEC Regional Office instructed examiners to not pursue certain “red flags” in an examination in which the SEC staff uncovered a massive fraud. The complaint further alleged that the senior official’s apparent motive for these instructions was that he either performed, or was materially involved in directing, the most recent prior examination of the firm that did not uncover the fraud, although it existed at the time. In addition, the complaint alleged that a hostile work environment existed in the Regional Office as a result of management’s failure to aggressively discipline the senior official after a previous OIG investigation revealed that the senior official had viewed pornographic images from an SEC computer.

During the reporting period, the OIG obtained and reviewed the e-mail records of 11 former and current SEC employees, and searched over 68,000 e-mails. We also obtained and reviewed thousands of pages of pertinent documents, including the examination files for three examinations conducted of the firm. The OIG also took the testimony of 17 witnesses who had knowledge of the facts and circumstances surrounding the allegations in the complaint. The OIG has nearly completed its investigatory work and intends to issue its report of investigation early within the next reporting period.

From the original whistle-blower letter, which got the investigation ball rolling:


SEC-IG Report [PDF]



Article courtesy of Dealbreaker

Diamondback Capital Has Done Right By Its Clients

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Anyone thinking of making any sudden moves should remember this.

Diamondback Capital Management LLC, one of three hedge funds raided by Federal Bureau of Investigation agents, returned three times as much as peers since being founded in 2005, according to an investor letter. Diamondback gained 73 percent from mid-2005 through July this year, compared with 22 percent for funds with a similar approach, as tracked by Chicago-based Hedge Fund Research Inc.

Even more comforting is this:

Diamondback, which manages about $5.8 billion, has returned about 6.3 percent this year and 23 percent last year, compared with gains of 12 percent and 25 percent, respectively, for multistrategy funds.

Do those look like returns a fund that’s up to no good? Not so much.

FBI Target Diamondback Beat Peers [Bloomberg]



Article courtesy of Dealbreaker

“Low-Level” Goldman Employees To Be Nailed For Insider Trading?

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As you may have heard, the FBI has something exciting planned for the holidays this year– Insider Trading Fest(ivus) 2010. Capping a three year investigation, charges that “could ensnare consultants, investment bankers, hedge-fund and mutual-fund traders and analysts across the nation” are said to be coming any time between now and early next year. So far the Wall Street name that’s gotten the most press– not because they’ve done anything wrong but because people love to hate on the beautiful– belongs to a hedge fund headquartered in Stamford, CT. But who are the others that may have accusations of wrongdoing laid on their asses? For one, some employees of Goldman Sachs. But lest you worry about waking up to Lloyd Blankfein being escorted out of 15 Central Park West wearing only his HLS sweats, fear not– apparently those being probed at GS are a bit lower on the totem pole.

Goldman Sachs is among the firms under scrutiny, according to a person briefed on the investigation who was not authorized to discuss the matter publicly. The person said the inquiry involved several low-level Goldman employees, not executives.

The vagueness of this statement clearly leaves it open to some interpretation. Just so we can be mentally prepared, are we to assume they’re talking about:

* (Least likely) VP-level employees?

* (Somewhat likely) Secretaries?

* (More Likely) First years trying to make a name for themselves?

* (Most likely) First years covering for partners, each of whom is assigned a buddy upon being promoted, who takes the fall for them in such instances?

* (THIS IS IT!!!) Last year’s Goldman summer interns, who are more advanced than most banks’ division heads?

US Is Said To Pursue Broader Insider Trading Case [NYT]



Article courtesy of Dealbreaker

How To React When The FBI Asks You To Help It Takes Down SAC Capital Et Al

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So! As previously mentioned, federal authorities are wrapping up a little project they’ve been working on for the past three years involving alleged insider trading, hedge funds, that sort of thing. The government claims the probes could “eclipse the impact on the financial industry of any previous such investigation” and that charges may come before the end of this year and perhaps as early as this week. Naturally it’s unclear as to exactly who the Feds are hoping to name as participating in the passing or receiving of material, non-public information but some educated guesses can be made, based on the accosting of one analyst, Jonathan Kinnucan.

Kinnucan, the founder of boutique firm Broadband Research LLC, was “sipping wine on his front porch in Portland, Oregon” when two men in suits popped out of a gray sedan and quite aggressively accused him of sharing inside information with his clients (hedge and mutual funds, mostly). They threatened to arrest him but then, changing to a friendly tone, suggested that things could be made better for Kinnucan if he did them a favor. “We think you can help us,’” he recalls. “There is this guy in particular we are after,” he remembers them saying. “We want you to have a conversation with him and record it.”

That clients, according to the Journal, is a trader at SAC Capital, and while it’s not certain the proposed recorded phone call would be between Kinnucan and the King of the Jungle, it is quite certain the Feds want the most majestic hedge fund in all of Stamford, CT and possibly Fairfield county.

But back to Jonathan. Several years back he was hit by a bus while on a run in Florida. His lungs were collapsed, his liver lacerated and there was serious internal bleeding and while speaking with the gentlemen from the FBI, he says “I just thought about being under that bus and knowing you have to keep fighting.” Despite inviting them into his kitchen, the hits kept coming. “It felt like a street mugging,” he says. “They were hammering me from either side.”

Kinnucan was told if he didn’t cooperate “there would be trouble,” and given the terrifying situation some might have buckled under the pressure. Did JK? Did he break down and cry, telling the Feds “Okay, fine, I’ll do it, I’ll do anything, just don’t hurt me?” No, he did not.

Instead, he 1) informed the agents that what he does “has nothing to do with ‘inside information’ and everything to do with a lot of hard work and insight” and that “if he’s trafficking in inside information…then so is the rest of Wall Street.”

2) Told them to piss off and thanks but no thanks to their offer to wiretap (at least we think; it’s actually unclear if JK has been wiretapped, but we’re giving him the benefit of the doubt).

3) Sent out a whimsical email to clients, including SAC and Citadel, tipping them off to the investigation, describing the visit and his heroic efforts to shield them from these beasts.

“Today two fresh faced eager beavers from the FBI showed up unannounced (obviously) on my doorstep thoroughly convinced that my clients have been trading on copious inside information,” the email said. “(They obviously have been recording my cell phone conversations for quite some time, with what motivation I have no idea.) We obviously beg to differ, so have therefore declined the young gentleman’s gracious offer to wear a wire and therefore ensnare you in their devious web.”

When the time comes, hopefully all of you will take a page from Kinnucan’s playbook. You lie down in the street (and get hit by a car or bus) if you have to.


FBI Visits Shed Lights On Tactics In Insider Trading Probes
[WSJ]



Article courtesy of Dealbreaker

Oracle in talks to hire Mark Hurd as a top executive

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Getting  fired, or forced to resign, from the top job at Hewlett-Packard may not have hurt Mark Hurd’s career after all.

Oracle is in talks to hire Hurd as a top executive, according to a report in the Wall Street Journal. Indeed, VentureBeat’s Owen Thomas predicted last month that it would make sense for Oracle to snap up Hurd.

The exact nature of the title Hurd might take is unknown. The talks aren’t complete and the deal could still fall through. Oracle’s board still has to approve any appointment. But the trial balloon (a leak of information that could be viewed as a test of public sentiment on a matter) has clearly been floated. If there isn’t an outcry, Hurd might have himself a new job.

There may very well be no outcry. Hurd was forced to resign from HP after he admitted to a lapse in judgment about his relationship with a former HP marketing contractor. The contractor sued Hurd for sexual harassment, and the suit was settled out of court. But the investigation into the matter turned up lapses that led to Hurd’s resignation.

Oracle might inherit some baggage if it hires Hurd. It can’t profess to espouse the very highest of business ethics if it makes the hire, since Hurd admitted he hadn’t lived up to HP’s code of business standards. On the other hand, Hurd delivered stellar financial results for HP during a period of tumultuous change in the tech industry.

The deal isn’t necessarily a surprise because Larry Ellison, chief executive and founder of Oracle, was the primary defender of Hurd’s reputation in the wake of the scandal. HP will have plenty to worry about if Oracle hires Hurd. The two tech behemoths are fierce competitors, especially now that Oracle owns the former Sun Microsystems hardware business. Oracle earned $6.1 billion in its most recent fiscal year, while HP earned $7.7 billion. Yet Oracle is a much smaller company, with around 100,000 employees compared to HP’s 300,000.

Hurd’s intimate knowledge of HP’s future strategy could be very useful if he joins a business that will compete head-to-head with HP. The Journal reported that Ellision, 66, isn’t planning on giving up the top post at Oracle. He also has two co-presidents, Safra Catz and Charles Phillips. Ellison has given them considerable responsibility recently.

Last week, rumors surfaced that Phillips might be departing Oracle after the company assigned responsibility for Oracle’s global business units — something that Phillips previously supervised — to executive Bob Weiler.

Ellison continues to have final say over strategic decisions at Oracle and is responsible for the company’s engineering efforts. He is the company’s largest shareholder, owning about 23% of Oracle.

Following Hurd’s resignation from HP last month, Ellison criticized HP’s board for letting Hurd go. The board, “failed to act in the best interest of H.P.’s employees, shareholders, customers and partners,” Ellison wrote in an email to the New York Times.

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Article courtesy of VentureBeat » Deals & More

Hedge Fund Managers Free To Break Bread While Plotting To Take Down Whichever Currency They Fancy

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Back in February, the Wall Street Journal printed an article about a hedge fund “idea dinner,” more than insinuating that a bunch of representatives from Soros, SAC, Greenlight and Paulson and Co got together to enjoy a meal of food while scheming re: how they were going to take down the Euro. This was uncool for a few reasons, included by not limited to the fact that it’s unlikely the handful of managers assembled would even be capable of taking down the currency and the shoddy reporting that said they ate fish when in fact it was chicken (a tad undercooked, if you must know). Also, as a result of the story, the Justice Department’s antitrust division opened an investigation into possible violations of the Sherman Act.

This was fucked up because a) despite the suggestion nefariousness doing, no one did anything wrong and b) it scared much of the industry’s participants into not taking part in these gatherings, which they really looking forward to. They wouldn’t even be seen talking a little shop over fro-yo! But, short of releasing some “Oh no you di’int” letters directed at the Journal. Today, though, comes relief: the Justice Department has closed the investigation and no action will be taken against anyone there that night. Everyone is safe to nosh on whatever they want while discussing going about cornering the OTC Bulletin Board Market for Pet Life Insurance Companies.

Exclusive: U.S. ends probe of hedge fund “idea dinner” [Reuters]



Article courtesy of Dealbreaker