Levitt: SEC Isn’t to Blame; So far: No Signs Family Aided Madoff

Arthur Levitt Jr., former SEC chairman told The NY Post.
“At this point, I don’t see any evidence that the S.E.C. dropped the ball,” Mr Levitt, now an adviser to Carlyle Group. Video interview: former NASDAQ chairman at 2007 roundtable discussion (33 minutes) with Josh (a Madoff Systems designer). You Tube Video/Link/Commentary from The Jewish Journal. So far, No Signs Family Aided Madoff but as details emerge of trading discrepancies and "Vast Options Game"

SEC Official Married into Family Madoff Boasted of Close SEC Relationship, "My Niece Even Married One" Video and More from ABC Investigative Team

Dealbreaker & Dealbook all over Madoff case, with pithy and other reader comments-RSS Feeds 24/7 Right here->

"There is no more Wall Street."

Alan “Ace” Greenberg, former Bear chief contends that the Street has changed forever with collapse of Lehman and the forced sale of his old firm and Merrill, destroying the investment banking model he helped create.
“That model just doesn’t work because it’s at the mercy of rumors”
In the end, Wall St was destroyed by the very tools Ace created. Greenberg career not over: he accepted a JPMorgan Chase position. Bloomberg reports he'll get a payout equal to 40% of commissions he generates. See Video from Bloomberg

Compliance Staffing Letters, Speeches/Letters from SEC

SEC issued a Letter to BDs, IAs,investment companies and transfer agents, to remind of the critical role played by their firms' compliance programs in assuring that operations comply with the law and rules and to ensure that clients are protected. The open letter follows SEC Chairman Cox's remarks at the SEC 11/13/08 CCOutreach National Seminar. SEC Links posted 12/2 http://www.sec.gov/news/press/2008/2008-283.htm

SEC approved measures to strengthen oversight of credit rating agencies. Video and more from SEC
Debt Watchdogs: Tamed or Caught Napping? Page 1 NYT Lured by profits during the housing boom, credit-rating agencies overlooked the risk of mortgage debt, critics say.

Wall Street Fire Sale

Page 6 has an upside to economic calamity? Schadenfreude. Take a gander at big-ticket items that super-rich Wall Streeters are selling as they feel the pocketbook pinch.
Need a Bailout? Here’s the Form. Companies queuing up for their share of the rescue pie. Others unsure how to get access to the government cash. For those unfortunate souls, Vanity Fair has a (mock) application, the EZ CASH form, that can help put “corporate scions” in the same stead as banks and, potentially, automakers.

More via NY Post. Pictured: Erin Callan: Once the highest- ranking woman on the Street, who rose to CFO at Lehman.

Wall Street Dismissals Benefit Small Financials

"There are still vacancies, more strategic, more selective" said Stuart Rosenthal, Recruiter (aka headhunter) with Legend Global Search. "We are asked for more accountants, lawyers or experts in the U.S. regulations.
This quote was in the French 'Wall St Journal' "Les Echos" in an article titled in French "Les licenciements de Wall Street profitent aux petites banques."
To read in a rough English translation please click here where the title appears as "The dismissals of Wall Street Banks Benefit Petites"

Morgan Stanley's Near-Fall \ Citi Saw No Red Flags

Extreme Makeover at Morgan Stanley-figuring out where to go from here


Rubin, Under Fire, Defends His Role at Citi DiscussionWSJ 11/29 UPDATE


Bailout now has a mission statement; you can read it here.

A mystery is how even relatively strong firms like Morgan Stanley were battered so quickly. According to The Wall Street Journal, it appears that a confluence of events combined to deliver a huge blow to the blue-chip investment firm. Active buying in the market for credit default swaps, increased short selling by hedge funds and whispers in clients’ ears by rival banks all increased during the time that Morgan Stanley’s stock plummeted to new lows.

Journal says that it’s hard to prove that anything untoward was done, especially in the opaque credit default swaps market. But it quotes memos from Morgan Stanley officials that suggest executives from the company suspected that some traders were doing just that.

Citigroup Saw No Red Flags as It Made Bolder Bets

Citi and the U.S. government in talks to create a "bad bank" to remove toxic from Citi's balance sheet. WSJ Online article

September 2007, Citigroup CEO, Charles Prince learned for the first time that the bank owned about $43 billion in mortgage-related assets. Asked Citi Tradin head Thomas Maheras whether everything was OK and Maheras told his boss that no big losses were looming. Normally, a big bank would never allow the word of just one executive to carry so much weight. Instead, it would have its risk managers aggressively look over any shoulder and guard against trading or lending excesses.

Citi insiders say the bank’s risk managers never investigated deeply enough. Because of longstanding ties that clouded their judgment, the very people charged with overseeing deal makers eager to increase short-term earnings — and executives’ multimillion-dollar bonuses — failed to rein them in, these insiders say.
Citigroup’s woes are emblematic of the haphazard management and rush to riches that enveloped all of Wall Street. Summary and link to Full Article

Compliance HQ: Who's Worse, Mark Cuban or the SEC?

Compliance HQ: Who's Worse, Mark Cuban or the SEC?

A Maverick Exchange: The Emails Between Mark Cuban and Jeffrey Norris

Who's Worse, Mark Cuban or the SEC?

Gary Weiss writes that it's a close question. Joe Nocera makes the point that the SEC, by pursuing this "boorish" billionaire while not giving a damn about, for instance, Overstock restatement of financials, proves that the SEC is sinking into irrelevance.

Interdealer 'Swap' Brokers | Wall St END Is Here

Spotlight Shines on Swap Brokers-latest focus of regulators is interdealer brokers...comments from Lutnick of Cantor which owns BGC. Subpoenas include Phoenix Partners Group, ICAP, GFI, IDX Capital, Tullett Prebon, BGC, Creditex and Standard Credit Securities Inc. WSJ

Wall Street's End Is Finally Here - Michael Lewis, author of "Liar's Poker" and "Moneyball" lengthy story for Portfolio

Hedge Fund Sued by Compliance Officer

NY hedgie dragged into court for firing of CCO for raising questions about trading activity. Joseph Sullivan, former top internal cop, sued Peconic Partners’s William Harnisch, alleging wrongful termination.

Cross-Border Private Banking: UBS Indictments

Tax evasion legal in Switzerland, not in US, this difference that has UBS at odds with regulators and authorities. UBS no longer offers, what it calls Cross-Border Private Banking services for US clients.
NY Times Wash Post and all other articles

U.S. Does Not Support a Global Crisis Regulator

“meeting is not about discarding market principles or about moving to a single global market regulator” Summit Nov. 14-15 has White House and President-elect in awkward spot. Leaders of 20 countries to assemble in Washington. Bush administration discouraged suggestions to create a new international market regulator with cross-border authority, The New York Times’s Mark Landler reported.
Obama campaign did not respond to inquiries about whether it was invited.

Compliance Jobs and Bonuses Resilient...Regulatory Climate change

WSJ today "Business Braces for Cooler Climate" more on this and Obamanomics below.

Compliance Jobs and Bonuses Resilient
"It depends on the firm, but we're hearing that bonuses at some bulge bracket firms might be better than initially expected," adds Stuart Rosenthal, vice president of compliance recruiting at Legend Global Search, a New York-based firm that specializes in placing compliance and legal professionals. "The bonuses may be down 25 percent or 30 percent from last year. They're not earth shattering, but in some cases they could be fairly good."
At least one sector of finance is experiencing continued demand and relative security in total compensation: compliance. Compliance professionals at all levels will likely be "somewhat insulated."

According to Rosenthal, a typical mid-level compliance officer at a large or medium-sized institution probably makes a salary in the "mid-100s," and can expect a bonus in a good year of about 100 percent of salary. In this market environment, it won't be 100 percent. While compliance professionals at the hardest-hit firms - like Morgan Stanley or Merrill Lynch, or the Lehman employees who were retained by Barclays - don't expect much, Rosenthal says those at other firms may fare reasonably well.

"There are even open positions in compliance," says Rosenthal, noting there are numerous active searches. He sees a number of top firms hiring where they have "special needs." Some firms with open positions are waiting to fill them or being very discriminating, looking at a wide number of candidates in an effort to fill the roles at compensation levels under stated budgets.

Job openings exist in range of compliance specializations, including hedge funds, funds of funds, portfolio compliance and bank compliance. More at EFinancial

Washington likely to usher in more than just tighter financial regulation.

WSJ today "Business Braces for Cooler Climate"...GE, with interests in a wide array of sectors, including financial, energy, electronics and health care, could be hurt by government efforts to exert more control over commerce. It also could be helped by more regulations. "If you think we won't get more regulation in places other than financial services, you're nuts," GE CEO Jeffrey Immelt told students at Columbia last month. "We'll get more regulation in health care, energy and other areas."Mr. Immelt says the heightened regulation "could be a catalyst for positive change....It doesn't have to be a negative."

Obamanomics: After pouring money into Obama campaign, what can hedge funds and their executives expect from the new president? Article from FINAlternatives>> In victory speech, Obama again suggested that Wall Street fortunes strayed too far from the rest of the country’s.

Obama’s Treasury Secretary Another Goldman alum?

Did you vote? Would Obama’s Treasury Secretary Be Another Goldman alum? According to The Deal.com, chatter is about NJ Governor Corzine...Go to Article from The Deal.com

Beware of Geeks...Bearing Formulas

WSJ looks at AIG risk-management operations. Raises questions about the run-up to the financial crisis: Did firms like AIG put too much faith in computer models? Warren Buffett sounding the alarm for years, recently, he told PBS' Charlie Rose: "All I can say is, beware of geeks...bearing formulas." Portfolio.com WSJ via The Australian