Posts belonging to Category Wachovia



Proposed Changes to New York Law Would Make Wall Street More Accountable

 

Wall Street may face a wave of lawsuits under an expanded version of the Martin Act, New York’s securities anti-fraud statute, if the newly elected Governor of New York has his way, according to a Wall Street Journal Deal Journal blog entitled, “And the Next Mortal Threat to Wall Street Is’”.

Many Auction Rate Securities Investors Remain Left Out in the Cold

 

$130 billion of retail and institutional investor money is still being held in auction rate securities over two years after the $330 billion auction rate market failed and froze, according to Daisy Maxey in her Wall Street Journal article, “Still Frozen After All These Years.” But just as the Paul Simon song modulates from gloom […]

Wall Street Firms May Face Problems Collecting on Bonus Loans and Retention Loans Given to Brokers

 

Arbitrations filed by brokerage firms against departed brokers to collect amounts due under promissory notes have accounted for 17% of all FINRA arbitration awards in 2010, the highest percentage in a decade, according to the Financial Industry Regulatory Authority (FINRA) and a recent Wall Street Journal article by Aaron Lucchetti (“Signing Bonuses Haunt Wall Street”).

Retirees Are Being Duped Into Purchasing High Risk Structured Products That They Do Not Understand

 

Securities firms have sold over $30 billion of complex structured products to investors (often retirees seeking safe income) who do not understand the nature and risks of these securities, according to an article by Zeke Faux which was published in the October 4-10, 2010 edition of Bloomberg Businessweek under the title, “Individual Investors Duped by […]

Wall Street’s Dump of Freddie Mac and Fannie Mae Preferred Stocks Cost Investors Billions

 

The sale of billion of dollars of Fannie Mae and Freddie Mac preferred stock in 2007 and 2008 was accomplished by fraud on unsuspecting public investors and the complicity of mortgage originators that bought the shares knowing they were poison, according to attorney and professor Seth E. Lipner in his July 7th Forbes article entitled […]

Wealthy Individuals Have Been Victimized By Wall Street’s CDO Fraud

 

Merrill Lynch and other Wall Street firms sold the riskiest tranches of collateralized debt obligations (“CDOs”), not just to institutions, but to individual investors, as safe investments, according to a recent Wall Street Journal article by Dan Fitzgerald titled “Didn’t See Risk, and Got Stung.” Now that the CDOs have imploded, and investors are seeking […]

Local Governments and Non-Profits Have Suffered Catastrophic Losses as a Result of Wall Street’s Excesses

 

According to a recent article in the Atlanta Journal Constitution, “at least a dozen local governments and other institutions that used derivative deals called swaps to try to lower the cost of bond issues have ended up owing as much as $394 million in fees to the Wall Street investment banks that set up the […]

Wall Street Abuses Have Significantly Increased the Economic Problems Currently Faced by State and Local Governments

 

In “Paying a price for risky schemes,” Atlanta Journal Constitution reporter Russell Grantham presents an excellent overview of how at least a dozen metro governments and nonprofits that issued debt were whipsawed by the “shadow banking system” ? the freezing of the auction rate securities markets and complex derivative contracts called swaps. As a result, […]

USAToday Observes that Wall Street Banks “Are No Longer in the Game for Their Clients but for Themselves”

 

Paulson, the hedge fund manager who shorted the Goldman Sachs CDO that is the subject of the SEC’s enforcement action, and the other “shorts” were “driven by disgust and indignation ‘ against Wall Street and its corrupt system designed to generate undeserved bonuses,” according to USAToday’s article entitled “Goldman case shows what’s the matter with […]

Many Wall Street Banks Disguised CDO Scraps as Tasty Morsels

 

Bloomberg writer Mark Gilbert says that the trouble with collateralized debt obligations (CDOs), which slice bundles of asset-backed securities into different risk-reward classes, is that no one has a clear idea of how risky any given slice is or any sense of how to quantify and value that risk.