Citigroup is fined $4.5 million by U.S. CFTC for deleting subpoenaed audio recordings
By Jonathan Stempel
NEW YORK (Reuters) - A U.S. regulator on Monday fined Citigroup Inc C.N $4.5 million for deleting millions of audio files, including recordings it had subpoenaed, after failing to fix a known design flaw in its audio preservation system.
The U.S. Commodity Futures Trading Commission said the Nov. 2018 deletion of 2.77 million audio files included recordings of traders subpoenaed in Dec. 2017 for a probe, which Citigroup had promised would be preserved.
Citigroup was accused of not following up on an employee’s warning in 2014 that the configuration of its audio preservation system might create a “ticking time bomb effect” that could, and did, cause mass deletions of audio files.
The civil fine was imposed against Citibank NA, Citigroup Energy Inc and Citigroup Global Markets Inc for the New York-based bank’s failure to maintain sufficient internal controls over its technology.
Citigroup did not admit or deny wrongdoing. A spokeswoman said the bank was pleased to settle.
According to the CFTC, the deleted recordings comprised 683,296 calls for 982 individual users, including recordings covered by its subpoena, and 2,087,789 recordings from speakerbox or “Hoot n’ Holler” lines.
The case is the latest to highlight problems with technology systems at the third-largest U.S. bank by assets.
Citigroup is battling separately in Manhattan federal court to recoup $900 million of its own money that it accidentally paid to lenders for the cosmetics company Revlon Inc REV.N. Some hedge funds that lent money to Revlon and received payments from Citigroup have balked at repaying the bank, which blamed the incident on a clerical error.
JPMorgan to pay $920 million for manipulating precious metals, treasury market
By Abhishek Manikandan, Michelle Price
(Reuters) - JPMorgan Chase & Co JPM.N has agreed to pay more than $920 million and admitted to wrongdoing to settle federal U.S. market manipulation probes into its trading of metals futures and Treasury securities, the U.S. authorities said on Tuesday.
The landmark multi-agency settlement lifts a regulatory shadow that has hung over the bank for several years and marks a signature victory for the government’s efforts to clamp down on illegal trading in the futures and precious metals market.
JPMorgan will pay $436.4 million in fines, $311.7 million in restitution and more than $172 million in disgorgement, the Commodity Futures Trading Commission (CFTC) said on Tuesday, the biggest-ever settlement imposed by the derivatives regulator.
Between 2008 and 2016, JPMorgan engaged in a pattern of manipulation in the precious metals futures and U.S. Treasury futures market, the CFTC said. Traders would place orders on one side of the market which they never intended to execute, to create a false impression of buy or sell interest that would raise or depress prices, according to the settlement.
This manipulative practice, which is designed to create the illusion of demand, or lack thereof, is known as “spoofing.”
Some of the trades were made on JPMorgan’s own account, while on occasions traders manipulated the market to facilitate trades by hedge fund clients, the CFTC said. The bank failed to identify, investigate, and stop the behavior, even after a new surveillance system flagged issues in 2014, the agency said.
“The conduct of the individuals referenced in today’s resolutions is unacceptable and they are no longer with the firm,” said Daniel Pinto, co-president of JPMorgan and CEO of the Corporate & Investment Bank. He added that the bank had invested “considerable resources” in boosting its internal compliance policies, surveillance systems and training programs.
In parallel settlements, the bank entered into a Deferred Prosecution Agreement with the Department of Justice and the United States Attorney’s Office for the District of Connecticut, staving off criminal prosecution on charges of wire fraud.
It also agreed to pay $35 million to settle related charges with the Securities and Exchange Commission, although the bank’s payment to the CFTC would offset that fine, it said.
In an unusual concession, JPMorgan also admitted wrongdoing in agreeing to the SEC and Justice Dept. settlements.
“This record-setting enforcement action demonstrates the CFTC’s commitment to being tough on those who intentionally break our rules, no matter who they are. Attempts to manipulate our markets won’t be tolerated,” said CFTC Chairman Heath Tarbert.
The CFTC and Justice Department have taken aim at spoofing in recent years, using sophisticated data analysis tools to spot potential wrongdoing that it could not previously detect.
Reuters has reported that around 2017, the agency began using techniques it originally developed to spot healthcare fraud schemes to identify suspicious trading patterns, including by scanning activity on exchanges.
“The idea was: let’s mine this data source to see who the worst actors are,” Robert Zink, a top Justice official who helped lead the effort, told Reuters in May here.
The agency has already charged six JPMorgan traders for manipulating metals futures between 2008 and 2016. On Friday, meanwhile, two former Deutsche Bank AGDBKGn.DE traders were found guilty here by a federal jury of spoofing, the agency said
The Supply Chain Is Broken And Food Shortages Are Here
ZeroHedge.com Sat, 09/26/2020 - 17:15
Authored by Robert Wheeler via The Organic Prepper,
If you are a reader of this site, you might be more interested in the food supply chain than most, at least when things are good. So, if you have been paying attention recently, you might find that there have been some severe disturbances in that supply chain.
Several months ago, the immediate disruptions began at the beginning of the COVID-19 hysteria, when factories, distribution centers, and even farms shut down under the pretext of “flattening the curve.”
As a result, Americans found necessities were missing on the shelves for the first time in years. Items like hand sanitizer and Clorox wipes were, of course, out of stock.
Soon other items became noticeably missing as well.
People began to notice meat, and even canned vegetables and rice were soon missing from the shelves. Most of this was simply the result of mass panic buying, although “preppers” were blamed for “hoarding.” Therefore, people who had not been prepping all along and were suddenly caught with their pants down.
But that’s not the whole story.
Manufacturing and packaging facilities and slaughterhouses shut down due to intrusive totalitarian government reactions to an alleged pandemic. Combined with panic buying, those facilities’ ability to replace what was bought up was drastically reduced. As a result, consumers were forced to wait weeks before buying what they needed (or wanted) again. Even then, they had to show up in the morning.
We are still experiencing those shortages, though better hidden. As anyone who shops regularly can tell you, you can find what you need, but you may have to go to three stores to get it, where one would have done in the past. In this article, you’ll find some advice about dealing with the limited varieties of inventory that people are currently noticing at stores.
War launched on the economy by state governments put millions of Americans out of work.
Now, when most rational people would be happy to have a job at all amid such high unemployment, they were prepared to stop the machine’s wheels from working.Workers suddenly started to organize, strike, and walk off the job conveniently when the food supply was already broken. Of course, these workers had not organized or initiated a strike at any time before when working conditions were bleak, and wages were low.
While extraordinary times beget extraordinary reactions, the timing of the newfound sense of workers’ resolve cannot go unnoticed. At the same time, we witnessed farms dumping thousands of gallons of milk down the drain, meat producers slaughtering animals and burying them, and farmers destroying crops all over the country and the world.
The reason for this is two-fold.
First, many major producers would not want a glut of their product on the market and see their prices dropdown.
Second, with the totalitarian measures forcing the shut down of restaurants across the country, many farms and producers lost a massive part of their market, thus destroying it.
A government genuinely concerned with its people’s health would have bought that produce and either distributed it or freeze-dried and stored it for the coming apocalypse.
Indeed, the Trump administration attempted this with some very minor success and high cost. Food banks at least benefited. But the damage to the food supply was already done.
And then came the winds.
As time moved forward, we saw devastating straight-line winds blow across places like Iowa, destroying massive amounts of crops and farming infrastructure, effects rarely advertised on mainstream media outlets.
Following those winds, we saw massive wildfires along the West Coast’s entirety from Washington to California and as far east as Colorado, South Dakota, and Texas.
One need only take a look at the map at fires seemingly heading east, burning up prairies and farmland all along the way to see that the food chain will experience yet even more hiccups once the smoke has cleared.
But while leftists claim the fires are the natural result of “climate change” and conservatives blame lack of adequate forest management (which has some merit), both completely ignore the fact that close to ten people were arrested for setting these fires.
Repeatedly, arsonists are being arrested for starting blazes though the motive is unclear. Those of us who have studied history, however, can speculate with some certainty.
But these problems are not unique to the United States.
Countries all over the world are experiencing supply chain problems. Australia, for instance, is about to run out of its domestic rice supply by December entirely.
Now, here we are, with winter fast approaching and the food supply decimated. The world’s population is walking around masked and terrified of getting within six feet of another human, and the cities all across America are on fire with violent riots.
Communists and the inevitable response are clashing in the streets and threatening to turn in to a possible American Civil War 2.0. What role will hunger play in this scenario?
At the moment, we can’t say for sure.
But what we can say with certainty is that this will be a very long, very trying winter.
Food shortages are coming, and they aren’t too far away.
You do not have much time left before the items you can grab now are gone and gone for good. Here are some tips for shopping when there aren’t many supplies left on the shelves, and here’s a list of things that are usually imported from China that we haven’t been receiving in the same quantities (if at all) since the crisis began.
Many of the readers of this website will be prepared, no doubt, but others won’t. Not only do we advise you to prepare – but we also advise you to be ready for the unprepared.
More than half of households in 4 largest U.S. cities struggled financially during pandemic, poll shows
https://theweek.com/ Tim O'Donnell
There's no question the coronavirus pandemic has forced many Americans into financial hardship, but a new NPR/Harvard T.H. Chan School of Public Health/Robert Wood Johnson Foundation survey provided a clearer picture of the extent of the struggles in the United States' four largest cities.
At least half of all households in those cities — 53 percent in New York City, 56 percent in Los Angeles, 50 percent in Chicago, and 63 percent in Houston — reported facing serious financial problems, including depleted savings, problems paying credit card bills, and affording medical bills.
Black and Latino households in all four cities were particularly vulnerable. In New York, 62 percent of Black households and 73 percent of Latino households reported struggles. In Los Angeles those numbers are 52 and 71 percent, respectively, while 69 percent of Black households and 63 percent of Latino households in Chicago have faced the same. And, most drastically, in Houston, 81 percent of Black households and 77 percent of Latino households said their financial issues were serious.
Interviews for the poll were conducted online and via telephone between July 1-Aug. 3 among 3,454 adults in New York, Los Angeles, Chicago, and Houston. The overall margin of error was 3.3 percentage points, while it was 5.4 percent for New York, 7.1 percent for Los Angeles, 5.4 percent for Chicago, and 6.3 percent for Houston.
Goldman Sachs, Morgan Stanley lower stress capital buffers after Fed's correction
Elizabeth Dilts Marshall
(Reuters) - Goldman Sachs Group Inc (GS.N) and Morgan Stanley (MS.N) on Friday revised lower two key measures of the banks’ ability to deploy cash in an emergency, after the Federal Reserve said it made an error in its June stress test results.
The Fed said Friday that it miscalculated hypothetical trading losses for Goldman and four other banks and issued corrected stress test results. In response, Goldman issued a statement saying it revised its stress capital buffer downward to 6.6% from 6.7%, and lowered the corresponding standard common equity tier 1 (CET1) ratio requirement to 13.6% from 13.7%.
Morgan Stanley meanwhile lowered its stress capital buffer to 5.7% from 5.9% and its CET1 ratio to 13.2% from 13.4%.
In June, the Fed examined big banks’ balance sheets to see if they had enough funds on hand to handle losses during two years of severe economic and market stress.
Goldman’s loan portfolio suffered significantly higher hypothetical loss rates than those of peers. The Fed ordered Goldman to hold the most capital of the 34 banks it tested, requiring it to have a CET1 ratio of 13.7% by Oct. 1.
Goldman said in June that it had already boosted capital measures and was on track to meet the Federal Reserve’s benchmark for October. Now that will be slightly easier to achieve.