Global Banks to Pay $5.6 Billion in Penalties

Credit: Wikimedia Commons

Five global banks will pay more than $5 billion in total penalties, and four of them (J.P. Morgan Chase & Co., Barclays PLC, Royal Bank of Scotland Group PLC, and Citigroup Inc.) will plead guilty to conspiring to manipulate U.S. and European currency prices.

According to the Wall Street Journal:

Authorities said euro dollar traders at the banks, who were self-described members of “The Cartel” communicated through coded language in an online chat room to coordinate attempts to move rates set at 1:15 and 4 p.m.

The traders would withhold bids or offers to avoid moving the rate in directions that would hurt open positions held by other members of the group, in violation of antitrust laws, prosecutors said.

No traders have yet been criminally charged over the conduct, butNew York’s financial regulator said it required Barclays to fire eight employees in connection with the resolution. Investigations into individuals are continuing, according to government officials.

Lawyers for the banks are expected to enter a series of pleas in federal court in Connecticut later on Wednesday.

Citigroup, which was accused of being involved in the misconduct from December 2007 through January 2013, is paying the largest criminal fine of $925 million. The other banks were accused of engaging in the conduct for various periods with that time frame.

Read the full article here (subscription required): http://www.wsj.com/articles/global-banks-to-pay-5-6-billion-in-penalties-in-fx-libor-probe-1432130400

In addition to the WSJ coverage, the Justice Department has released a statement on the parent-level guilty please by the banks. According to justice.gov:

“The five parent-level guilty pleas that the department is announcing today communicate loud and clear that we will hold financial institutions accountable for criminal misconduct,” said Assistant Attorney General Caldwell. “And we will enforce the agreements that we enter into with corporations. If appropriate and proportional to the misconduct and the company’s track record, we will tear up an NPA or a DPA and prosecute the offending company.”

Read the entire press release here: http://www.justice.gov/atr/public/press_releases/2015/314165.htm

*Disclaimer: The views and opinions on this blog are those of the author. Nothing contained in this weblog is intended as legal advice. This weblog was created to provide general information, opinions of the author and general musings. Accessing this website is not a consultation for legal advice or services and this weblog does not create an attorney-client relationship.

Real Housewives’ Jim Marchese Lands Another Whistleblower Settlement

Photo: Bill Denver for The Wall Street Journal

Photo: Bill Denver for The Wall Street Journal

Most people know Jim Marchese from his role in the reality show “Real Housewives of New Jersey.” But in legal circuits, he’s also known as a corporate whistleblower who has scored big settlements — twice. According to the Wall Street Journal:

The small mortgage firm Mr. Marchese owns in Shrewsbury, N.J., most recently collected $8.5 million for helping kindle the Justice Department’s record $16.65 billion settlement last summer with Bank of America Corp., which was accused of selling shoddy mortgage investments in the run-up to the financial crisis.

Before that, in 2007, Mr. Marchese received $1.6 million after reporting his former employer, a Seattle pharmaceuticals firm now called CTI BioPharma Corp., for allegedly defrauding Medicare.

“I’m trained as an attorney, I’m Sicilian, and I’m from New Jersey,” said Mr. Marchese, 45 years old. “If I see you kick a puppy, I’m going to say something. It’s not within me to not say something.”

Read the full article here (subscription required): http://www.wsj.com/articles/whistleblower-jim-marchese-scores-millions-in-payoutagain-1429695001

*Disclaimer: The views and opinions on this blog are those of the author. Nothing contained in this weblog is intended as legal advice. This weblog was created to provide general information, opinions of the author and general musings. Accessing this website is not a consultation for legal advice or services and this weblog does not create an attorney-client relationship.

 

Monica Seles’ Binge Eating Tour: For Charity or Profit?

Image Credit: Wikimedia Commons

Our firm noticed something curious the other day while reading a New York Times article (“Shire, Maker of Binge-Eating Drug Vyvanse, First Marketed the Disease”) on top-selling drug, Vyvanse, to treat binge-eating disorder.

The article kicks off with a recap of retired tennis player Monica Seles’ recent media tour to discuss her binge-eating disorder. The article quotes a People magazine interview in which she says, “It took a while until I felt comfortable talking about it…. That’s one of the reasons I decided to do this campaign: to raise awareness that binge eating is a real medical condition.”

But she’s not doing it out of the goodness of her heart. Ms. Seles is a paid spokeswoman for the company that markets Vyvanse:

Days after Shire gained [F.D.A.] approval [to market Vyvanse], Ms. Seles began touring media outlets. And patient advocacy groups — freshly infused with donations from Shire — began driving social media traffic to a company website that provides advice on how to raise the issue of binge eating with a doctor. Shire is ramping up a national print and online advertising campaign, and since last year has been raising awareness about the disorder among doctors.

So, the question is, how can you trust many celebrities championing nonprofit causes when many of them actually work for for-profit companies marketing a product?

*Disclaimer: The views and opinions on this blog are those of the author. Nothing contained in this weblog is intended as legal advice. This weblog was created to provide general information, opinions of the author and general musings. Accessing this website is not a consultation for legal advice or services and this weblog does not create an attorney-client relationship.