Hernan Arbizu has been arrested in Argentina on charges that he stole $5 million from the accounts of customers at UBS AG and JPMorgan Chase

Hernan Arbizu was arrested Monday in Buenos Aires on charges filed in U.S. District Court in May.Arbizu was a vice president in the private banking division at JPMorgan when he embezzled the money between March 2007 and April 2008, prosecutors said. He caused $5.37 million to be transferred out of private banking accounts at the UBS (nyse: UBS - news - people ) and JPMorgan financial services companies during that time, they said.Arbizu was responsible for maintaining and developing private banking relationships in Latin America at the time, court papers said.It wasn't immediately clear who would represent Arbizu on charges of embezzlement, bank fraud and aggravated identity theft.U.S. authorities were seeking to extradite Arbizu to New York.If convicted, Arbizu, 41, could face up to 30 years...

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Posted in: JPMorgan

Lou Pai, the former chief executive of Enron Energy Services, charged with improperly selling hundreds of thousands of Enron shares in 2001.

Lou Pai, the former chief executive of Enron Energy Services, with improperly selling hundreds of thousands of Enron shares in 2001.The stock market regulator said Mr Pai sold the shares after being informed that the Enron subsidiary had sustained substantial losses, but before the losses had been reported publicly. Mr Pai, who has neither admitted nor denied the SEC's charges, has reached a settlement with the SEC under which he has agreed to pay a $US1.5 million ($1.6 million) fine. The former Enron high-flyer has also agreed to pay $US30 million in disgorgement of his gains and other related fees relating to the allegedly improper stock trades. “The commission has never relented in pursuing fraud committed by Enron's executives, and I am pleased that today's settlement will add another...

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Posted in: Enron Fair Fund

FBI is investigating possible fraud at IndyMac

The FBI is investigating possible fraud at IndyMac, the California lender which was seized by regulators last Friday after America's biggest high street bank failure for two decades. Law enforcement sources told the Associated Press that the inquiry revolved around home loans made by IndyMac to risky borrowers and was focused on the bank itself, rather than on individuals who ran it.The FBI declined to comment on IndyMac specifically, although a spokesman said the scope of the bureau's examination of the sub-prime mortgage industry had broadened from 19 inquiries to 21 since April. A spokesman said: "We receive information from a variety of sources on a daily basis, and we have an obligation to review each allegation on its merits."Banking regulators took over IndyMac after a run on deposits,...

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Posted in: IndyMac

Jagmeet Channa pleaded guilty to one count of conspiracy to defraud and another of money laundering after he admitted using colleagues' passwords

Jagmeet Channa, 25, showed no remorse as Judge Geoffrey Rivlin, sitting at the Southwark Crown Court, bemoaned his limited sentencing powers in dealing with the "audacious and outrageous" crime. Channa had previously pleaded guilty to one count of conspiracy to defraud and another of money laundering after he admitted using colleagues' passwords to steal money from a trading account which he then wired to associates in Manchester and Morocco. Today, Judge Rivlin told him: “This was no silly prank. This was a carefully planned and very serious attempt to transfer a fortune in money away and it almost succeeded." Channa worked at the Canary Wharf headquarters of Britain's largest bank for less than a year. In April, the court heard, he sent €60 million from an HSBC trading account to a Societe...

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Posted in: HSBC

number of corporate bankruptcies in Japan rose 11.6 percent in the first half of 2008 with the number of cases related to higher material prices

Bankruptcies for the first six months totalled 6,022, while combined liabilities climbed 17.4 percent to 3.019 trillion yen (28 billion dollars) compared with the same period last year, Teikoku Data Bank said.number of corporate bankruptcies in Japan rose 11.6 percent in the first half of 2008 with the number of cases related to higher material prices hitting a record high, researchers said on Tuesday.June saw 1,065 bankruptcies leaving liabilities of at least 10 million yen each, up 7.1 percent from 994 cases in May, the research firm said in its monthly report.However, combined liabilities in June was down 1.9 percent from the previous month to 471.92 billion yen, but was still 40.3 percent up on the same period last year, it said.Bankruptcies in construction stayed at a high level due to...

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Posted in: Japan

If you're sitting there doing a crossword and you put the paper on the key, boof-boof-boof-boof, it can go right off ... You can just keep trading

Making money makes reputations at investment banks, but the numberless ways in which high-profile traders can lose eye-popping sums is making the case for much sharper focus on the unglamorous role of the risk control units.Despite a regular crop of scandals and errors, from unauthorised positions to "fat-fingered" trades, there is insufficient investment in systems to monitor traders and prevent unacceptable losses, said Giles Nelson, co-founder of trading technology provider Progress Apama."If you look at surveillance of trading behaviour, it's somewhat seen as a Cinderella," said Nelson."The real focus is on the exciting stuff, on making money, making deals ... That's where the investment in technology is."Yet the same traders can also lose a bank billions of dollars by circumventing the...

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Posted in: Progress Apama

Another Bank failure as Mortgage lender IndyMac Bancorp Inc said on Tuesday depositors had been withdrawing cash at an "elevated" pace

Mortgage lender IndyMac Bancorp Inc said on Tuesday depositors had been withdrawing cash at an "elevated" pace since a key U.S. senator questioned its ability to survive the housing crisis.IndyMac shares sank 38 percent to 44 cents. A collapse of the largest independent, publicly traded U.S. mortgage lender could prove a headache for U.S. regulators since more than $17 billion of its deposits carry federal insurance.Paul Miller, a Friedman, Billings, Ramsey & Co analyst, said shareholders may be wiped out, citing IndyMac's decision to stop most mortgage lending and inability to raise capital. Miller cut his price target for the stock to zero from $1.00."It's hard to gauge how this situation will resolve itself," said Christopher Wolfe, managing director at Fitch Ratings. "We see a high...

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Posted in: IndyMac Bancorp Inc

Fitch indicated it may move to cut its credit rating on Merrill’s long-term debt

Merrill Lynch (MER) has garnered the nod as an outlier among investment banks in terms of credit worthiness. But it’s a dubious distinction, at best. Ratings agency Fitch indicated it may move to cut its credit rating on Merrill’s long-term debt - a prospect it basically erased for the other three major investment banks. Citing the scope of the long-term credit that comes due next year, Fitch placed Merrill’s long-term issuer default ratings on rating watch with a negative bias, a move that often presages an upcoming cut in the credit rating itself. Fitch expressed pessimism about the prospects for Merrill’s fixed-income, currency and commodity operations, which it said could off-set strength in areas like Merrill’s retail brokerage operations. The rating agency also said that it anticipated...

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Posted in: Merrill Lynch

Bank failures are extremely rare, savers might want to bear in mind that the Government will only underwrite the first £35,000 of your savings in any

Halifax said house prices had fallen by more than 6 per cent during the last year, having fallen 2 per cent in the last month. The average property now costs around £180,000. Mortgage rates have already hit their highest level for eight years, according to the Bank of England. The average rate on a two-year fixed rate mortgage has risen from 6.26 per cent to 6.63 per cent.The pain is set to continue as lenders tighten their lending criteria. For example, Alliance & Leicester still allows homeowners to opt for a term of 40 years on their mortgages but affordability will be calculated as if you were paying it back over 25 years. Ray Boulger of mortgage brokers John Charcol, said: "Today's Monetary Policy Committee (M per cent ) decision to keep the bank rate unchanged at 5 per cent was widely...

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Posted in: Halifax

Baninter US$2.5 billion fraud, which led to the world’s biggest bank collapse per capita

after five years the Supreme Court put an end to the proceedings that led to bank fraud convictions in the Baninter case, when it upheld the verdict against the main defendants. Dominican society kept close tabs during this long process to prosecute the Baninter US$2.5 billion fraud, which led to the world’s biggest bank collapse per capita, and put the country’s judicial system to the test.Central Bank legal consultant for banking fraud, Fidel Pichardo Baba, said the case’s result sets an historical precedent which fortifies the Judicial Branch and is also an example that justice must be equal for all. "This decision just now shows that it’s possible to condemn whoever commits a crime regardless of standing and that the very next day the sun rises at the same hour and the Earth doesn’t shake,"...

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Posted in: Baninter case

IndyMac is the largest regulated thrift to fail and the second-largest financial institution to close in U.S. history

New chief executive of IndyMac Bancorp, brought in by the government to manage the failed bank, said new lending standards should prevent the kind of problems that have brought down credit markets.John Bovenzi, the chief operating officer of the Federal Deposit Insurance Corp., reassured consumers that bank failures have been rare in the past, and that if more banks do fail, the government has enough in reserve"I think the important point to make is that, historically, only a very small percentage of the banks on our problem banks list ever failed," he said on CNN late Sunday. "While there are 90 banks on the list, there would be no expectation that 90 of those banks would fail."Bovenzi took the helm of what will be IndyMac Federal Bank when the government stepped in late Friday afternoon...

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Posted in: IndyMac

U.S. regulators seized California savings and loan company IndyMac Bank and its $32 billion in assets.

Investors are scanning the banking industry for signs of more trouble after the biggest U.S. bank failure in more than two decades. Last week, U.S. regulators seized California savings and loan company IndyMac Bank and its $32 billion in assets. Troubles are mounting so quickly at some of the country's 7,500 banks that as many as 150 could fail over the next year or so, analysts said. Healthier banks are expected to shut branches or mer...

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Posted in: IndyMac Bank