Archive for the ‘Business’ Category
Pam Martens and Russ Martens report in Wall Street on Parade:
Last Thursday, September 22, 2016, the body of Ann Korkki, a Senior Administrative Assistant in the Wealth Management division of JPMorgan Chase in Denver, Colorado was found with the body of her sister, Robin Korkki, inside their luxury vacation villa at the Maia Resort on Seychelles, an island in the Indian Ocean off the East African coast. Ann Korkki was 37; her sister Robin was 42.
According to the local Seychelles newspaper, there was no sign of violence on the bodies of the women who were on a one week vacation at the resort. The mother and brother of the sisters are currently in Seychelles “pressing U.S. and local officials for details” and making arrangements to bring the sisters back to the U.S. according to a news report in the Minneapolis Star Tribune, which covered the story because the sisters had attended high school in the area.
This latest unusual death of a JPMorgan Chase employee adds to a stunning roster of bizarre deaths since 2014 – a period which has also seen three felony counts leveled against the firm by the U.S. Justice Department and billions of dollars in fines for wide-ranging charges of wrongdoing.
News reports on the bizarre deaths began with Gabriel Magee, a JPMorgan Vice President who worked in computer infrastructure. Magee, 39, is alleged to have leaped from the rooftop of the 33-story JPMorgan European headquarters building at 25 Bank Street on the evening of January 27, 2014 or the morning of January 28, 2014. London tabloids initially reported that Magee’s jump was observed by “thousands of commuters” and JPMorgan colleagues. But after an official inquest, no eyewitnesses could be produced who had actually seen Magee jump. The coroner ruled that Magee’s death was a suicide.
Three weeks after Magee’s alleged leap from the bank’s skyscraper in London, a JPMorgan employee in Hong Kong, 33-year old Dennis Li (Junjie), is said to have leaped to this death on February 18, 2014 from the 30-story Chater House office building in Hong Kong where JPMorgan occupied the top floors. At the time of the death, Wall Street On Parade received elusive answers from the communication team at JPMorgan Chase as to the young man’s job function at the bank. The South China Morning Post newspaper called Li an “investment banker”; the Standard newspaper in Hong Kong wrote that Li was an accounting major who worked in the finance department at JPMorgan. The China Times wrote that Li was a “Forex trader.” On May 20 of last year, JPMorgan Chase pleaded guilty to a felony count by the U.S. Justice Department for its role in rigging foreign currency exchange trading.
Also in February 2014 came news reports that JPMorgan Executive Director, Ryan Crane, age 37, had died suddenly at his home in Stamford, Connecticut on February 3, 2014. After approximately three months, the Connecticut Medical Examiner released the cause of death, calling it ethanol toxicity/accident.
One month after Crane’s death, on March 12, 2014, yet another alleged building leap occurred, this time in Manhattan by a former JPMorgan analyst, Kenneth Bellando, age 28. Bellando’s body was discovered outside his six-story apartment building on the East Side of Manhattan, by no means a height reliably sufficient to ensure a death outcome.
Bellando was the brother of John Bellando, a JPMorgan employee who had figured in the U.S. Senate Permanent Subcommittee on Investigations’ report on how JPMorgan had hid losses and lied to regulators in the London Whale derivatives trading scandal that resulted in depositor losses of at least $6.2 billion in the FDIC-insured bank of JPMorgan Chase. The bank paid a total of $1.2 billion in fines to U.S. and U.K. regulators. The Justice Department brought criminal charges against two of its traders involved in the scheme.
Two months after Bellando’s death, on May 7, 2014, Thomas James Schenkman, age 42, died suddenly in Connecticut. Schenkman was Managing Director of Global Infrastructure Engineering for JPMorgan Chase. Schenkman began his technology career with Microsoft, where he worked for 11 years. He had also previously worked at Goldman Sachs and Bear Stearns. Schenkman’s tenure at JPMorgan stretched from 2008 to the time of his death. The cause of death was eventually assigned to “atherosclerotic coronary artery disease” by the Connecticut Office of the Chief Medical Examiner.
Another death by a JPMorgan worker that went initially unnoticed outside of Wall Street On Parade was that of Jason Alan Salais, age 34. The death of Salais came just six weeks before Magee’s alleged leap from the JPMorgan skyscraper in London. Salais was standing outside a Walgreens drugstore on the evening of December 15, 2013 and died of a sudden heart attack according to a family member. Salais had joined JPMorgan in 2008 with a strong background in computer technology, having previously worked as a Client Software Technician at SunGard and a UNIX Systems Analyst at Logix Communications.
Then there were the unfathomable murder-suicides in New Jersey where . . .
A press release from Sen. Sheldon Whitehouse (D-RI):
U.S. Senators Sheldon Whitehouse (D-RI), Harry Reid (D-NV), Barbara Boxer (D-CA), and Edward Markey (D-MA) released a report today entitled, “The Brief No One Filed,” highlighting the real forces behind the legal challenge to President Barack Obama’s Clean Power Plan to reduce greenhouse gas emissions. The report – which is structured as an amicus curiae or “friend of the court” brief but was not filed with the court – demonstrates that the state officials, trade associations, front groups, and industry-funded scientists participating in the challenge actually represent the interests of the fossil fuel industry. The Senators explain that the report is designed to “share their knowledge and understanding of the connection between the fossil fuel industry’s political spending (both open and in secret) and political blockade of any measures to address climate change.”
“The American public is aware of and alarmed by the massive influx of special interest money and considers this a top problem with elected officials in Washington,” the Senators write. “More than 80% of Americans believe the government cannot be trusted to do what is right most of the time. As active legislators and national leaders, [we] have a strong interest in restoring the faith of the people in our government and political system. This starts with limiting the ability of massive dirty energy companies, either directly or through their armada of front groups, to stop anything that doesn’t serve the fossil fuel industry’s financial interests.”
The report contains substantial detail on the complex network connecting the opponents of the Clean Power Plan and the fossil fuel companies that support their effort. The Senators note, “The briefs opposing the Clean Power Plan that some Members of Congress, state politicians, and outside organizations filed in this case may be seen as another expression of this climate denial apparatus. In aggregate, the politician authors of these briefs have received over $107 million from the fossil fuel industry, and while they are ostensibly elected to represent the interests of their constituents, we regularly see them taking positions that are opposed to conclusions drawn about the effects of climate change by institutions and academics in their own states.”
While issuing the report to inform the public on issues surrounding the case, the Senators underscore that they “fully and enthusiastically support the brief submitted on March 31, 2016, with current and former members of Congress in support of the respondents” in the case, including the Environmental Protection Agency. All signatories to the report released today are also signed on to that brief.
The challenge to the Clean Power Plan, West Virginia v. U.S. Environmental Protection Agency, is slated for oral arguments before the U.S. Court of Appeals for the District of Columbia tomorrow.
The full report can be accessed here.
Knight Capital made headlines around the world when one of its computers went on a shopping spree that ended up costing the company $440 million. So surely its secrets would come out now.
This is the final part for the time being. The SEC seems to be shirking its responsibilities, but the SEC has proved to be an ineffective regulator
As recently as today, a couple of comments on Wicked_Edge went into a familiar rant: that the proprietor of Phoenix Artisan posed as a veteran and thus we must downvote any favorable mention of his company or products: the Internet lends itself to that sort of cybermob, and of course anonymity is a factor as well.
As you know, rumors are so common on the Internet that there are several sites like Factcheck.com and Snopes.com that exist solely to rebut the various false rumors. But it is inevitable that this will happen. The nature of memes is that there is some variation as the meme (and its variants and their variants, etc.) are copied/repeated. Darwinian law applies in the meme struggle for survival, and the meme that reproduces most dominates. In the Darwinian/survival sense, that version is a “better” meme—that is, more likely to be repeated. However, as you can see (scroll down), does not mean that the highly successful meme-variant actually corresponds to the truth. Its success is derived from its fecundity of reproducing (being repeated), not from its truth (which, from a meme point of view, is irrelevant—the meme is fighting to survive, and only the most repeatable variants will succeed. The “better” meme is just a meme that propagates well—and in this case, that is not the meme of what actually happened (as you see—scroll down). One of the two memes just does better in the memeverse.
UPDATE: Other examples of memes that are highly successful at propagating despite being false: childhood vaccines cause autism and global warming is a hoax.
UPDATE 2: Someone on Wicked_Edge got the impression that this stuff about memes is something I created. Regular readers know that memes have been of interest to me for a while, and memetics is in fact a subject of study, not something I made up. I do find that it provides a look at how human culture evolves that seems valid to me, but I make no claim for originality or authority in discussing memes. For those interested, here is a brief reading list:
Richard Dawkins: The Selfish Gene, chapter 11 is where “meme” was first defined and introduced.
Susan Blackmore: The Meme Machine
Rober Aunger (editor): Darwinizing Culture: The Status of Memetics as a Science
Richard Brodie: Virus of the Mind: The New Science of the Meme
Tim Tyler: Memetics: Memes and the Science of Cultural Evolution
If your goal is to launder money through a brokerage account, paper losses are worth serious money. Buying imaginary shares of a stock guaranteed to lose value is an awesome way to do that. You just need someone to set it up.
Just read this article on the iPhone 6 touchscreen disease. Charging $329 to replace a phone that fails due to bad design doesn’t seem all that customer-oriented to me.
David Dayen reports in The Intercept:
Last week, Well Fargo CEO John Stumpf testified before the Senate Banking Committee after the bank paid fines for creating over 2 million fake customer accounts to boost their sales growth statistics. Stumpf, under fire from senators demanding that the bank claw back executive bonuses as punishment for the scandal, insisted that any such decision would be made by a committee of the board of directors that handles compensation issues.
That board is made up of five current and former CEOs and executive chairpeople who have enjoyed giant salaries throughout their careers. Pulling the trigger on clawbacks would force them to turn on the system that made them rich. They’d also have to bite the hand that feeds them a steady supply of Wells Fargo stock.
This is a common situation, and it helps explain why executive compensation has inflated in recent decades. Corporate CEOs sit on one another’s boards and approve oversized pay packages, in the expectation that they will get the same treatment from their board in return. Some, like Stumpf, serve as both the CEO and board chairperson simultaneously.
Stumpf has said that he would make no recommendations to the board on whether they should claw back any of his compensation, or that of his fellow executives.
The Human Resources Committee of the Wells Fargo board evaluates and approves executive compensation plans for the bank. Here are its five members:
- John Chen, the executive chair and CEO of Blackberry, Inc. since November 2013. In 2014, as a reward for his employment, Chen received a stock-based bonus of $84.7 million on top of $1 million in salary. The board said that the $84.7 million stock award helped “align the interests of Executive Officers with the achievement of the Company’s long-term business objectives and the interests of shareholders.” Chen’s 2015 compensation, which included even more stock, was $3.4 million, and in 2016, $3 million.
- Donald James, the retired CEO of Vulcan Materials. James served from 1997 to 2014, and in his final year, he earned $13.36 million. Of that $3.9 million came from stock awards, and another $1.3 million in options.
- Stephen Sanger, the former CEO of General Mills from 1993 to 2008. In his final two years at the company, Sanger earned $19.15 million and $18.57 million, respectively. The majority of these earnings came in the form of stock grants and options.
- Lloyd Dean, the CEO of the nonprofit Dignity Health Foundation, one of the three largest hospital systems in California. Since Dignity Health is a privately held company, it’s difficult to find executive compensation statistics, but in 2010 the Institute for Health and Socio-Economic Policyreported Dean’s pay for that year at $4.76 million. Kaiser Health Newsreported in 2013 that Dean’s compensation had increased to $5.14 million, with $2.05 million of it in “bonus and incentive pay.”
- Susan Engel, the CEO of Portero, a luxury retail sales company, from 2009-2013, and before that the CEO and chairwoman of Lenox Group Inc., a holiday gift manufacturer, from 1996-2007. Engel received $837,865 in compensation from Lenox Group in 2006, the last year for which a proxy statement can be located. Her salary as CEO of Portero is unavailable because the company is privately held.
In addition to the millions bestowed upon them by their own boards, these current and former CEOs receive a generous stipend for being on the board of Wells Fargo. According to the company’s most recent proxy statement, in 2015 Chen made $279,027; James made $293,027; Sanger made $382,027; Dean made $346,027, and Engel made $331,027. The majority of those payments came in the form of stock as well.
Top executives often receive stock instead of a base salary because of a Bill Clinton-era law exempting “performance-based” pay from a cap on corporate tax deductions for executive compensation.
Under Wells Fargo’s self-imposed “clawback” policy, the Human Resources Committee can revoke executive stock awards in the event of misconduct, including anything that causes the company reputational harm or a failure in risk management. While companies rarely enforce these provisions, as former FDIC chair Sheila Bair told CNBC when the false account scandal broke, “If you’re going to use clawbacks, this would be the situation.” . . .
The article ends with a fact that ensures corporations will continue to defraud the public:
Despite the fact that Wells Fargo was fined $190 million in the fake accounts scandal, the executives responsible for the misconduct have paid no price.