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Archive for the ‘Iran Money Laundering’ Category

News of the World Still Making News

Rupert Murdoch may have shut down his phone hacking London tabloid, but that hasn’t stopped it from generating news. This month’s stories include:

  • Parent company News Corp. named a new person to its Board of Directors – Mr. Alvaro Uribe, a former president of Columbia. Appropriately enough Mr. Uribe’s former chief of staff was arrested last year in connection with a case involving illegal wiretapping.
  • A number of prominent individuals have recently filed their own lawsuits seeking damages for the alleged hacking of their own phones. Among the names are Neil Kinnock, former head of Britain’s Labour Party, Stephen Byers, a former cabinet minister, and an assortment of actors and other celebrities.  A total of 53 new claims were submitted earlier this month bringing the total to 174.

News in the World of Banking

  • JPMorgan Chase may have been recently added to the list of banks included in the Iran money laundering investigation.
  • JPMorgan is also facing growing pressure in the US Senate regarding the losses in its risk management operation.
  • Freddie Mac stands to recover several $ Billion-with-a-B from various banks which had entered into mortgage repurchase agreements with Freddie Mac.
  • And then there was/is Lehman Brothers. Remember those guys? Well what’s left of their company has just sued JPMorgan Chase for over $ 2 Billion related to derivatives obligations. Lehman is also fighting JPMChase over the $ 6 Billion the big bank claims they are owed by Lehman.
  • And last but not least in the world of banking, a report just out from Better Markets claims that Americans have lost a total of $12.8 TRILLION since the collapse of Lehman Brothers.
  • In the meantime, asset manager Blackrock was fined $ 15 million by a UK regulatory agency for not following certain rules aimed at protecting investors’ money in the event that Blackrock went under.

Observation: Every piece of harm the banking industry has done ends up being an aggregate multi-billion loss for investors and consumers. Every successful prosecution ends up with a multi-million dollar fine and no one going to jail. What’s wrong with this picture?

Justice in the News

  • Stanford Financial’s former chief investment officer, Laura Pendergest Holt, was sentenced to three years in prison for her involvement in the Houston company’s multi-year ponzi operation.
  • A whistle-blower who testified against UBS was awarded $104 million by a federal court. The case was a significant test of the government’s ability to successfully award individual whistle-blowers. The particular case involved UBS’ alleged attempts to entice US citizens to evade taxes. UBS had settled with the US by paying $780 million to avoid being prosecuted.

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Money Laundering for Iran

It’s late August. Even the financial news takes a vacation. So of course it was a quiet couple of weeks with little news on Libor, the JPMorgan Chase hedge unit, News of the World or even Chesapeake. Government investigations likely continue their steady grind behind the curtain. Meanwhile both Tampa and New Orleans braced themselves for Isaac.

But wait, there was one new story of note: Laundries. Our own family has two laundries. One isn’t that great but it does a decent job with the standard business shirt for a reasonable price. The other is where we take our nicer outfits to be dry cleaned. It appears that Iran might have copied that model as several banks stand accused of laundering Iranian money on its way to and from the U.S. That would be illegal, due to the current international sanctions against Iran.

Standard Chartered

The story was just breaking in our last post when UK’s Standard Chartered was accused by the New York State Department of Financial Services with allegedly laundering $250 BILLION for Iran through its New York branch. The next week, Standard Chartered was reported working on a $340 Million deal with New York State allowing it to continue to operate in New York. The deal was completed, but only after their CEO left his vacation early (bummer!) to head directly to the US to negotiate.  Standard Chartered still has to face several US Federal agencies.

Standard Chartered was also sued by the estates of military personnel killed in Lebanon in 1983 on the basis that the bank had concealed its Iranian money at the time the plaintiffs won a suit against Iran in connection with the tragedy.

Deutsche Bank and RBS

Several days later, Deutsche Bank was named as an additional target of Iran money laundering investigators.

Not to be outdone by the Germans, the Royal Bank of Scotland was also cited as a target in the investigation.

Facebook

While apparently innocent in terms of Iran, Facebook’s iPO debacle continued to spew out more stories. One of its prominent directors dumped a reported $$ Billion-With-a-B in stock as soon as his restrictions in selling had lapsed. And the COO reportedly let out to an investor that the $38/share IPO value had been determined in part based on what it would take to deter Wall Street traders from simply flipping the stock. You mean it had nothing to do with the company’s actual value?? Unbelievable.

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