Wall Street

Wall Street Takes Aim At New Transparency Rule For Executive Pay

Susan Crabtree | July 22, 2011, 6:00AM

Wall Street

Wall Street has deployed an army of lobbyists to try to whittle away as much of the Dodd-Frank financial reform bill as possible, spending $242.2 million on 712 hired guns to press their message on Capitol Hill since the beginning of 2010, according to a new report by Public Citizen.

The 30 most politically active business and financial industry organizations also ponied up $15.6 million in federal political contributions during the same time period. The entities with the deepest pockets include: the U.S. Chamber of Commerce, the American Bankers Association, the Financial Services Roundtable, MetLife, Goldman Sachs, to name just a few.

Why lay out so much cash to influence Washington in the months leading up to the first anniversary of the Dodd-Frank financial reform law? Some of Wall Street's biggest firms are gunning for a rule specifically designed to address one the main causes of the financial meltdown: exorbitant incentive-based executive compensation packages.

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Financial Crisis

AEI Fellow Says Financial Crisis Commission Tried To 'Suppress' Data

Ryan J. Reilly | July 15, 2011, 1:30PM

Peter Wallison

A Republican on the federal commission charged with finding the cause of the nation's financial crisis is pushing back at allegations that he improperly advocated for a repeal of financial regulations. He's flinging back in the faces of his Democratic opponents the charge that he wanted a pre-determined outcome from the panel's report.

Peter Wallison, in an article posted on the conservative group American Enterprise Institute's website, accuses Financial Crisis Inquiry Commission Chairman Phil Angelides, a Democrat, of a "concerted effort to suppress" data from Wallison's colleague that they claim showed the government's mortgage policies played a role in the financial crisis.

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Darrell Issa

How Darrell Issa's Investigation Into Financial Crisis Commission Backfired On GOP

Ryan J. Reilly | July 14, 2011, 2:08PM

The House Oversight Committee's investigation into the government commission that was supposed to figure out the cause of the the financial crisis appears to have backfired on the Republicans who lead the committee.

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Peter Wallison

Republican On Financial Commission Worked To Help GOP Repeal Dodd-Frank

Ryan J. Reilly | July 13, 2011, 4:47PM

Peter Wallison

A Republican on the Financial Crisis Inquiry Commission tried to get his colleagues to help House GOPers repeal the Dodd-Frank financial reform bill, according to documents released by Democrats on the House Oversight Committee.

Democrats released their report on the evidence uncovered by congressional investigators on the same day that Rep. Darrell Issa scrapped a hearing on the FCIC that was supposed to take place. Issa cancelled the hearing because, Democrats said, Republicans uncovered some evidence which didn't fit their narrative.

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Goldman Sachs

Manhattan DA Subpoenas Goldman Sachs Over Financial Crisis

Eric Lach | June 2, 2011, 12:38PM

Lloyd Blankfein, Chairman and CEO of Goldman Sachs & Co.

Goldman Sachs has received a subpoena from the Manhattan District Attorney's office, which is looking for information on the bank's activities leading up to the financial crisis, two sources "familiar with the matter" told Bloomberg.

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Rand Paul

Rand Paul: Economic Collapse Could Lead To 'A Hitler' Coming To Power

Zachary Roth | May 21, 2010, 12:29PM

KY Sen. candidate Rand Paul (R)

Rand Paul warned last year that a worsening economy could lead to "a Hitler" coming to power in the U.S.

During an August 2009 speech at a "machine gun shoot" in Knob Creek, Kentucky, the GOP Senate candidate -- last seen walking back his opposition to a key piece of the Civil Rights Act -- declared that "we are on the precipice of an economic calamity", and asked: "What happens if the entire dollars collapses because we have so much debt?"

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Bailout

Bailout: Best Program Evaaah?

Zachary Roth | May 11, 2010, 9:26AM

Federal Reserve Chairman Ben Bernanke and former Treasury Secretary Henry Paulson

As unpopular government initiatives go, the financial bailout would seem to rank somewhere up there between Prohibition and the Stamp Act.

In the political sphere -- and not just in far-right circles -- it's something close to a consensus view that the bailout was a corrupt giveaway of taxpayers dollars to Wall Street that will leave us deep in the red for decades. As Rep. Brad Sherman (D-CA) put it after TARP passed: "Only two things are certain: the bill will provide hundreds of billions of dollars to investors who made bad decisions and Wall Street executives; and our children and grandchildren will now face a national debt that is hundreds of billions of dollars higher." Sen. Bob Bennett (R-UT) was just ousted by state Republicans, who cited his vote for the TARP and derisively nicknamed him "Bailout Bob." And Sen. John McCain (R-AZ) has taken to claiming, implausibly, that he only supported the bailout because he was misled about the fact that it was targeted at the financial sector (seriously).

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Joseph Cassano

Report: AIG Probe Likely Wrapping Up Without Criminal Charges

Zachary Roth | April 5, 2010, 10:10AM

Former AIG Financial Products chief Joseph Cassano

The federal probe into the circumstances that triggered the near-collapse of AIG in 2008 has "hit a brick wall," unnamed sources have told CBS News.

Joseph Cassano, the AIG exec at the center of the probe, will sit down next week with DOJ lawyers, in what will likely bring an end to the investigation. Cassano is former head of AIG Financial Products, the unit of the company responsible for the disastrous credit-default swaps that led to the firm being bailed out to the tune of $180 billion.

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Pay-Day Lenders

With Heavy Washington Presence, Pay-Day Lenders Sway Lawmakers, Attack Critics

Zachary Roth | March 17, 2010, 12:39PM

The weakening of the Senate proposal on financial reform unveiled this week, after lobbying from the pay-day lending industry, should come as little surprise. In recent years, the industry has built a sophisticated Washington lobbying and public relations operation, which it has used to promote its interests, savage its critics, and shape the public debate.

The $42-billion-a-year pay-day lending industry offers short-term loans often designed to tide customers over until their next pay-check. But the loans, which can carry interest rates of as much as 400 percent on an annualized basis, lead many working-class borrowers to end up digging themselves deeper into debt. As a result, the pay-day lenders have become a prime target of consumer advocates and their allies on Congress, who accuse the industry of preying on struggling Americans, and have in recent years sought ways to rein it in.

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Pay-Day Lenders

After Lobbying By Pay-Day Lenders, Dodd Bill Is Weakened

Zachary Roth | March 16, 2010, 12:33PM

Sen. Chris Dodd (D-CT).

As we've reported, the pay-day lending industry -- one of the most predatory players corners in the modern financial system -- has recently been hard at work lobbying to water down provisions in the financial regulatory reform bill currently in the Senate. (We also told you about the industry's key lobbyist, who used to be the sub-prime industry's man in Washington.)

Now Sen. Chris Dodd (D-CT) has unveiled the reform proposal that will create the basis for the Senate bill. And it looks like the industry's lobbying, up to a point, has paid off -- although it's still unhappy that it's being seriously regulated at all.

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Wright Andrews

Master Of Disaster: The Go-To Washington Lobbyist For Financial Predators

Zachary Roth | March 11, 2010, 3:45PM

Wright Andrews

The same Washington lobbyist who led the sub-prime mortgage industry's successful bid to shoot down government efforts to curtail risky lending is now helping pay-day lenders to water down the financial-regulatory reform bill currently before Congress.

Wright Andrews has developed a niche representing some of the least sympathetic and most predatory players in the financial industry. A veteran lawyer-lobbyist and one-time aide to Democratic senator Sam Nunn, Andrews has lobbied extensively of late for a trade association for pay-day lenders -- which offer short-term, high-interest loans to the working poor, often triggering a cycle of debt for their customers. During the last decade, Andrews ran three different trade groups for the sub-prime mortgage industry, whose home loans defaulted in massive numbers to set off the financial crisis.

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W. Allan Jones

High-Living Pay-Day Lender CEO Tied To Bid To Weaken Financial Reform

Zachary Roth | March 10, 2010, 3:55PM

W. Allan Jones

In the wake of the biggest financial crisis since the Great Depression, a high-living, politically connected Tennessee businessman who made a fortune by lending money to the poor at sky-high interest rates has ties to a successful effort to water down financial regulatory reform.

Meet W. Allan Jones, who in 1993 founded Check Into Cash, a pay-day lending chain that says it now has 1,100 stores in 30 states. The company offers short-term loans designed to tide customers over until their next paycheck. But the interest rates can be as much as 400 percent on an annualized basis, meaning that they lead many borrowers to end up digging themselves deeper into debt.

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Bank of America

Cuomo Charges BofA, Lewis, With Securities Fraud

Zachary Roth | February 4, 2010, 12:18PM

Former Bank of America CEO Ken Lewis

New York Attorney General Andrew Cuomo has filed civil securities fraud charges against Bank of America and the firm's former CEO Ken Lewis, reports (sub. req.) the Wall Street Journal.

Cuomo alleges that Lewis, Chief Financial Officer Joe Price, and other BofA execs, chose not to disclose to shareholders the extent of the losses at Merrill Lynch before BofA bought the ailing Wall St. investment bank in late 2008.

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AIG

AIG Paying Bonuses To Unit That Helped Trigger Crisis

Zachary Roth | February 3, 2010, 3:57PM

American International Group (AIG) office

It's hard to blame people for tuning out the periodic reports of bailed out financial firms still paying huge bonuses to their staff. After all, there's only so much outrage a person can summon over the long haul.

But here's one that's worth a fresh round: AIG, the bailed-out insurance behemoth whose lavish "retention payments" triggered the first round of fury last year, plans more payments this month, worth $100 million, reports the Washington Post. And this week, the employees scheduled to cash in are from the firm's financial products division. That's the unit whose dodgy credit default swaps triggered the billion dollar losses that led to the financial crisis, and subsequent bailout, in the first place.

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Jamie Dimon

VIDEO: JPMorgan CEO: 'We Have Crises Every Five Or Ten Years' -- So No Biggie

Zachary Roth | January 13, 2010, 3:11PM

JPMorgan CEO Jamie Dimon

The banking crisis that nearly triggered the collapse of the U.S. financial sector in 2008 and continues to cause after-shocks around the world was a routine occurrence, the head of one of the investment banks that helped cause it suggested today.

Here's what Jamie Dimon, CEO of bailout beneficiary JPMorgan Chase, said during testimony before the Washington commission that's probing the causes of the crisis:

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Wall Street

Time For Some Answers: Wall St. CEOs To Go Before Financial Crisis Panel

Zachary Roth | January 13, 2010, 8:57AM

Clockwise from top left: CEO's Lloyd Blankfein of Goldman Sachs, Jamie Dimon of JPMorgan Chase, Brian Moynihan of Bank of America, and John Mack of Morgan Stanley.

What did top banking executives know about the events that led to the near-collapse of the financial system in 2008, and when did they know it? Those are two of the questions that we may start getting answers to this morning, when the commission probing the causes of the crisis holds its first public hearing.

The CEOS of four bailed-out banking behemoths -- Lloyd Blankfein of Goldman Sachs, Jamie Dimon of JPMorgan Chase, John Mack of Morgan Stanley, and Brian Moynihan of Bank of America -- all will go before the Financial Crisis Inquiry Commission in Washington today.

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Wall Street

New Dems Met With Wall St. Execs While Pushing to Weaken Financial Reform

Zachary Roth | January 6, 2010, 12:45PM

Rep. Joseph Crowley (D-NY)

A group of moderate Democrats held private meetings this fall with executives from Goldman Sachs and JP Morgan Chase, while in the midst of pushing successfully to water down landmark legislation designed to beef up regulation of the financial industry.

In mid October, members of the New Democrat Coalition (NDC), a caucus of pro-business Democrats, traveled to New York City. According to an emailed itinerary for the trip drawn up by an event planner working for the group and obtained by TPMmuckraker, members met on October 12 with executives from Goldman, and the following day with execs from JP Morgan. Sandwiched between those events was a fundraiser for the New Dems, and a meeting with CEOs from Marsh and McLellan Companies, a consulting and insurance firm.

[SEE THE ITINERARY EMAIL HERE. SEE AN INVITATION FOR THE FUNDRAISER HERE]

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Neel Kashkari

Former Bailout Czar Signs On With Firm That Helped Run Bailout

Zachary Roth | December 9, 2009, 3:10PM

Neel Kashkari

What a difference a day makes.

On Sunday, we learned from a florid Washington Post profile that Neel Kashkari, the Treasury Department's one-time bailout czar, is now Thoreau-ing it up in the Northern California woods. (Sample line: "The moon hits his stubble, which is six days old.") But the very next day, the investment behemoth PIMCO announced that it had hired Kashkari as a managing director and the head of new investment initiatives.

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CNBC

CNBC Blinded By Lavish Lifestyle Of Another Alleged Ponzi Schemer

Zachary Roth | December 1, 2009, 2:47PM

Tim Durham

Jon Stewart has already cornered the market on lampooning CNBC for the chronic lack of skepticism that characterized its coverage of the financial world during the boom years.

But the network's failure wasn't just a case of cheer-leading for Wall Street banks that made bad bets on the housing market. Both before and after last fall's financial crisis, CNBC has lavished fawning coverage on several high-flying financiers who later, say prosecutors, turned out to be little more than frauds. And this past week offered the latest example.

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Jenny Beth Martin

Top Tea Partier, Husband, Owed IRS Half A Million Dollars

Zachary Roth | October 8, 2009, 2:36PM

Jenny Beth Martin

A top activist with the anti-tax Tea Party movement has had a personal brush with federal tax collectors. Jenny Beth Martin, a co-founder and national co-ordinator for the Tea Party Patriots, owed, with her husband, over half a million dollars to the IRS when the pair filed for bankruptcy last year, according to filings examined by TPMmuckraker.

The couple's bankruptcy filing, made in August 2008 to the US Bankruptcy Court for Georgia's Northern District, stated that Martin and her husband Lee Martin, of Woodstock, Georgia, owed the IRS $510,000, after making a payment of $16,640 that June. The couple also owed just over $71,000 to Ford Motor Credit, the automaker's financing arm.

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Bernard Madoff

Madoff Claimed He Was On "Short List" For SEC Chair

Zachary Roth | September 2, 2009, 3:36PM

When Franklin Roosevelt appointed Joseph P. Kennedy as SEC chair, the president responded to concerns about Kennedy's unsavory reputation by declaring: "It takes a thief to catch a thief."

Over 70 years later, Bernard Madoff may have been hoping that President Bush agreed.

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Bernard Madoff

Madoff: "I Thought It Was The End Game. Over" -- But SEC Never Followed Up!

Zachary Roth | September 2, 2009, 3:16PM

It's not really news that the SEC screwed up big-time on Bernard Madoff. But the just released executive summary (pdf) of the agency's inspector general report really brings home just how far that failure went.

The summary, produced by SEC inspector general David Kotz, paints a picture of a series of botched investigations going back to 1992, in which inexperienced, unsophisticated and incurious agency examiners repeatedly failed to take seemingly obvious steps that would have uncovered Madoff's massive scam. And it shows how Madoff used his air of authority to confuse and intimidate the over-matched Feds in order to keep them at bay.

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Bernard Madoff

SEC Lawyer Who Failed To Catch Madoff Got Highest Performance Rating

Zachary Roth | September 2, 2009, 2:26PM

The SEC attorney who failed, despite numerous red flags, to catch Bernie Madoff's colossal fraud received the highest possible performance rating from the agency -- citing her "ability to understand and analyze the complex issues of the Madoff investigation" -- soon after the probe closed in 2006.

That's according to an SEC inspector general report on the Madoff fiasco, whose executive summary (pdf) was released this afternoon. The full report will be made available in the coming days.

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