Deutsche Bank to pay $75 million to settle lawsuit by Epstein accusers
CNN
23-05-18 04:43
Deutsche Bank has agreed to pay $75m to settle a class action-related lawsuit brought by Epstein accusers, who claim the bank enabled his sex trafficking activities. Epstein died in jail in August 2019. The former Deutsche client, who had banked with the lender from 2013 to 2018, was also a client of JPMorgan Chase between 1998 and 2013. The bank, which has faced multiple suits regarding Epstein's activities, may yet face similar legal challenges from accusers; the settlement will not prevent future claims from being brought against Deutsche or JPMorgan. The banks have not commented on the settlement.
Deutsche Bank is to pay $75m to Jeffrey Epstein's sexual abuse victims in order to settle a case against the bank in New York. The settlement awaits approval from a federal judge and is intended to bring closure to a class-action suit in which the bank was accused of either ignoring or overlooking clear warning signals in Epstein's accounts which showed he was part of a sex trafficking ring. Lawyers for the victims of Epstein have previously sued JP Morgan, while the government of the U.S. Virgin Islands have also taken legal action against the bank.
The blockbuster exhibition China’s Hidden Century, opening this week at the British Museum, places responsibility for the violence inflicted on 19th-century China on Britain and other foreign powers, while exuding admiration for China’s resilience and innovation. Exhibition organisers said their four-year research project involved over 100 scholars in 14 countries, and will “open a new page in public understanding of late imperial China”. Its 300 pieces, half of which have never been seen in public before, cover the Qing dynasty from 1796 to 1912, a period of great upheaval in China, ending when a revolution overthrew the last emperor. However, the exhibition walks a diplomatic tightrope; blame is unequivocally placed on foreign powers for provoking the Opium Wars and thereby sparking China’s traumatic “century of humiliation”, a myth central to the Communist Party’s legitimating narrative of China as a successful state. A reappraisal of 19th-century China threatens this narrative.
There is increasing evidence of the decline in power of the banks and the rise of the state, with many elements suggesting that the situation will continue. Governments believe that tighter control of bank liquidity risks could stabilise their financial systems and the recent emergency funding provided to European and British banks in the wake of the Brexit vote, and American banks in the wake of the ongoing economic turmoil, give credence to this suggestion. State control is also growing in terms of protection for bank deposits and regulation of asset quality, while the relationship between the banks and the government is shifting from co-operation to dominance. This trend is causing concern that the state will soon start dictating what loans banks can provide, as well dictating how those loans are priced.
To address these concerns, regulatory bodies will likely tighten rules on interest-rate risk, which could lead to limits being placed on the types of loans banks will be allowed to issue and will significantly influence the types of lending products being offered on the market. Another issue that needs to be tackled is who decides what assets are eligible as collateral for emergency loans issued by central banks. Commercial financial institutions may only be able to hold assets deemed acceptable by the government, and a new social contract and regulatory approach is needed to ensure that risk-based lending is still protected, while excess and unfettered risk taking is minimised.
Deutsche Bank agrees to $75M US settlement with Jeffrey Epstein victims
CBC
23-05-18 14:08
Deutsche Bank has agreed to pay $75 million in a settlement over allegations that it should have seen evidence of sexual exploitation by American financier Jeffrey Epstein when he was a client. The lawsuit was launched by a woman only identified as Jane Doe and claimed the bank had profited from Epstein’s sex trafficking. Deutsche Bank was said to have chosen “profit over following the law” to earn millions of dollars from the businessman. The bank has previously acknowledged it made mistakes in taking on Epstein as a client, and has since invested over €4bn ($5.9bn) to bolster anti-financial crime processes.
A mishmash of regulations across US states is causing difficulties for businesses. Different state governments have differing views on everything from the production of lifts to running a bank, and have legislated to ban abortions, encourage diversity on company boards or outlaw race discrimination in pursuit of diversity. A US state government's decision to regulate one area of business can have widespread impact given that American firms operate in a country which has a coast-to-coast marketplace that is too important for it to take for granted. “If the trend of state supermajorities persists after the 2024 elections, things could get worse," warns The Economist's opinion column, Schumpeter. Companies' third headache, when it comes to navigating different legislations, is to do with greenery as states introduce contradictory regulations about oil, gas and coal investments. The challenge is compounded by the fact that doing business in the EU may require sustainability reporting, which some in the US find unpalatable.
Deutsche Bank is to pay $75m to settle a lawsuit by women who say they were sexually abused by the late financier, Jeffrey Epstein. One of the firms representing women in the case called it the biggest sex trafficking settlement with a bank in US history. The lawsuit alleged that the bank knowingly benefited from Epstein's sex trafficking. Deutsche Bank has acknowledged that it was a mistake to take Epstein on as a client, but the bank had thitherto joined JPMorgan Chase, which is also being sued over links to Epstein, in fighting the claims brought by victims. Deutsche Bank said that from 2013 to 2018 it provided "routine banking services" to Epstein, and claimed the lawsuit did not prove it was "was part of Epstein’s criminal sex trafficking ring".
US banks are adopting emergency procedures and bolstering risk management strategies to combat social media 'attacks' after Silicon Valley Bank failed in March this year partly as a result of customers withdrawing millions of dollars after rumours surrounding the bank's health circulated on Twitter. As banks adapt to a world where tweets can have a significant impact on company reputations and lead to liquidity issues or a quick slide in share prices, they are rethinking the role of social media as a marketing tool to one that should be managed as a potential risk.
Deutsche Bank has agreed to pay $75m to settle a lawsuit claiming the German lender failed to see evidence of sex trafficking by financier Jeffrey Epstein when he was a client. A woman only identified as Jane Doe sued the bank in federal district court in New York and sought class-action status to represent other victims of Epstein. One of the law firms representing women in the case, Edwards Pottinger, said it believed it is the largest sex trafficking settlement with a bank in US history. Deutsche Bank noted that it had invested more than $4.3bn to bolster controls against financial crime.
Charlie Javice, a young entrepreneur, has been indicted on charges of defrauding JPMorgan Chase out of money to buy her college financial aid start-up, Frank. She has been accused of securities fraud, wire fraud, bank fraud, and conspiracy. The company was sold for $175m in 2021, but prosecutors allege that Javice lied to JPMorgan by saying her start-up had lined up 4.25 million student customers, while the true number was closer to 300,000. In December, JPMorgan sued Javice and her former chief growth officer Olivier Amar for fraud.
Yellen warns bank CEOs of ‘severe’ economic consequences if debt ceiling isn’t addressed
CNN
23-05-18 20:12
US Treasury Secretary Janet Yellen has warned more than two dozen bank CEOs of the “catastrophic” consequences of failing to raise or suspend the debt ceiling. JP Morgan Chase CEO Jamie Dimon and Citigroup CEO Jane Fraser were among those at the meeting, which also covered the risks posed by the debt ceiling and the ongoing banking crisis. Earlier this week, Yellen met with executives from mid-size banks, who expressed concern about the deadlock surrounding the debt ceiling and how it could affect their institutions. The United States could run out of cash to meet its obligations unless the ceiling is raised or suspended before June 1.
Elon Musk has said that he thinks working from home is “morally wrong”. While many have suggested reasons why Musk, founder of Tesla, may have issued the comment, including the fact that he has production lines that need to be staffed, NYT columnist Farhad Manjoo argues against the sentiment. Manjoo writes that if we want people to go to work, “we have to do something about a ritual of American life that’s time-consuming, emotionally taxing, environmentally toxic, and expensive: the daily commute”. Commuting takes up a significant amount of time each day, with the average one-way commute in the US reaching almost 28 minutes in 2019. People are “making a rational calculation”, says Manjoo. If they can work from home and become more efficient, they will. Conversely, the downside to remote work is that it could cause cities to suffer. Many large urban areas depend on the daily office worker commute for businesses such as cafes and restaurants to operate optimally. As such, making the most of remote work involving better city infrastructure is the most viable solution.
The Shanghai Stock Exchange has proposed plans to increase the valuation of Chinese state-backed banks, which are currently discounted by around 36% to their book value. The exchange's General Manager, Cai Jianchun, outlined the plans to executives at a recent meeting, which included the suggestion of businesses holding more investor relations events and the development of index-based fund products. China's banking sector remains one of the most distressed industry groups. Despite a 5.3% gain for 43 banks on the exchange, and a 16% climb in the shares of China's largest listed banking organisations this year, ICBC is trading at 44% below its net asset value.
Morgan Stanley CEO James Gorman has revealed plans to step down within a year to be succeeded by one of three internal candidates. While no exact timing has been agreed, Gorman suggested he planned to become executive chair after his successor has assumed the CEO role. Morgan Stanley's market value has tripled to around $140bn during Gorman's more than
a decade-long tenure, driven in part through a doubling down on wealth and asset management.
With JPMorgan's Investor Day taking place on Monday, analysts will seek more details about the bank's acquisition of First Republic Bank, as well as Jamie Dimon's succession plan following James Gorman's announcement that he will step down as Morgan Stanley CEO in the next 12 months. The investor day will also provide insight on the bank's plans to integrate First Republic's business into the largest bank in the US, as well as reports on the bank's performance via comments on the economy, growth, deposit growth, strategic opportunities, loan loss provisions and expenses.
An investigation launched last year by India's Securities and Exchange Board into offshore entities with holdings in Gautam Adani's companies has "hit a wall", according to a report by a committee appointed by the country's supreme court. Among the investigators was the US's Hindenburg Research, which this year accused Adani of stock price manipulation and fraud. The committee could not find evidence of regulatory failures but the report concludes that Sebi has drawn a blank in its investigation into 13 offshore entities it deemed suspicious, adding that bankers had declined to assist in matters relating to cross-border transactions.
Lawyers for Jes Staley, former CEO of Barclay’s, have refuted allegations brought against him by JPMorgan Chase that he masked a relationship with now-deceased sex offender Jeffrey Epstein. The bank is seeking to make Staley liable for two lawsuits alleging the bank failed to flag Epstein's transactions for 15 years and helped him maintain a network of victims by turning a blind eye to suspicious transactions. JPMorgan has also claimed that Staley vouched for Epstein, whereas Staley’s lawyers argue that the assertion is based on shaky foundations. A federal judge is due to rule on the motion to dismiss by the end of the month.
Morgan Stanley Chairman and CEO James Gorman will step down as CEO and transition to executive chairman, the bank said. Gorman will remain in the role of CEO for at least the next year while the board searches for his successor. "When I do step down as CEO, it is the board's and my expectation that I will assume the role of executive chairman for a period of time," he said. Morgan Stanley co-presidents Ted Pick and Andy Saperstein, as well as Dan Simkowitz, head of the bank's investment management business, are seen as possible contenders to replace Gorman.
A US federal judge will decide by the end of the month whether JPMorgan can proceed with its lawsuit against former executive Jes Staley, who developed a friendship with convicted sex offender Jeffrey Epstein. The bank accused Staley of getting caught up in Epstein's shenanigans and putting JP Morgan at risk of damages from lawsuits brought by Epstein's alleged victims as well as the US Virgin Islands. Staley, who later went on to become CEO at Barclays, claimed the bank was using him as a "public relations shield" for its own shortcomings.
The chances of the Federal Reserve raising interest rates next month have fallen from 36% to 18.6%, and some experts believe the central bank won't raise rates again in June. Wall Street had been betting on the latter scenario, after the Fed meeting earlier this month created hopes that it was done with rate hikes, but a slate of strong economic data last week led to some nerves. Key data points set for release before the June 14 rate decision include the April Personal Consumption Expenditures price index, the May jobs report, the May Consumer Price Index and the May Producer Price Index.
