Tag: Citigroup

The SEC’s Day in Court

The SEC’s Day in Court

Judge Jed S. Rakoff of the United States District Courts of the Southern District of New York struck a blow against the Securities and Exchange Commission and in support of the “public interest.” The Securities and Exchange Commission had asked the Court to approve a Consent Judgment between Citigroup and the S.E.C. Judge Rakoff (cutting to the chase) wrote he could not do so.

Simon Johnson: ‘We have done nothing that will prevent this from happening again’

Simon Johnson: ‘We have done nothing that will prevent this from happening again’

Here’s the question: Can sovereignty and effective international supervision be reconciled when it comes to complex large financial institutions? Simon Johnson lays out a compelling case that they cannot. As he has said time and again, there is no meaningful resolution authority capable of dealing with large complex cross-border institutions like Lehman Brothers. We either let them fail like Lehman or bail them out.

Meanwhile people like Tim Geithner are arguing that financial institutions should be allowed to get even bigger.

Video below.

Citigroup’s Chuck Prince confirms that risky behaviour drives out prudent when risk is rewarded

Former Citigroup CEO Chuck Prince made what could be considered the most infamous statement of this credit crisis when he said: "as long as the music is playing, you’ve got to get up and dance. We’re still dancing." –Citi Chief on Buyouts: ‘We’re Still Dancing’, DealBook, July 2007 This statement was correctly interpreted as a defence of a reckless disregard […]

Short sale fraud

CNBC’s Diana Olick has the breaking story on alleged fraud in the mortgage industry. She has been writing about this for a few days now.  See Big Banks Accused of Short Sale Fraud – Realty Check with Diana Olick at CNBC’s website. Basically, second liens on properties like home equity loans have a blocking interest that can prevent a home […]

On releasing Citi from TARP and banking by accounting subterfuge

Credit Writedowns has made it clear how little will there is in Washington for substantive reform in financial services.  But, let’s be more explicit in this post about what policy makers are doing.  I will use the recent Citigroup TARP brouhaha and changes to the implementation timetable of accounting rules as the vehicle for this discussion. The conventional wisdom about […]

U.S. forfeiting billions in future taxes to let Citi repay TARP

The Washington Post is reporting that the federal government has quietly decided to exempt Citigroup from a large future tax bill in allowing it to exit the TARP program.  This is a backdoor bailout worth billions and is an outrage that demonstrates the lengths to which government will go to gift these organizations taxpayer money. At issue is accounting for […]