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Citigroup may be earning $20bn a year by end of 2012

March 11th, 2010

Before You Invest

Citigroup may be earning as much as $20 billion a year from its core business by the end of 2012, according to a prediction from the bank’s chief executive officer Vikram Pandit.

Mr Pandit is set to use an upcoming speech to investors to predict that Citigroup can earn a yearly return of 1.25 per cent on its assets, reports the Financial Times.

Citigroup’s asset level stood at more than $1,300 billion at the end of 2009, with the bank estimating this will grow by around five per cent a year.

Based on these figures, Citigroup may surpass the $20 billion mark in 2012 as it seeks to increase its global presence.

“Clients look to us as being the financial conduit to the world,” Mr Pandit has said. “We want to be a global bank for institutions and individuals.”

Earlier this year, Citigroup reported losses of $7.6 billion for the final quarter of 2009 – with $6.2 billion of the deficit attributed to the bank’s repayment of its bailout funding.

Posted in Finance Fraud

Tags: Assets, Bailout, Chief Executive Officer, Citigroup, Core Business, Financial Times, Global Bank, Global Presence, Institutions, Investors, Losses, Pandit

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Reverse Convertibles—Complex Investment Vehicles

March 11th, 2010

Before You Invest

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Over the past few years, brokerage firms and banks have been issuing and marketing complex investments known in the industry as “structured products” to individual investors. These include “reverse convertibles,” which are popular in part because of the high yields they offer.

Also known as “revertible notes” or “reverse exchangeable securities”—and sold under a variety of proprietary names that may or may not use the term “structured” to describe the product—reverse convertibles are debt obligations of the issuer that are tied to the performance of an unrelated security or basket of securities.

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Posted in Finance Fraud

Tags: Assets, Banks, Bonds, Brokerage Firms, Debt Instrument, Debt Instruments, Debt Obligations, Elements, Financial Instruments, Fixed Income Products, Individual Investors, Inflation Risk, Investment Professionals, Investment Vehicles, Investments, Proprietary Names, Reverse Convertibles, Stocks, Structured Product, Structured Products

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Citigroup plans to sell hedge fund business

February 26th, 2010

Before You Invest

Citigroup is in talks with SkyBridge Capital to sell its hedge fund business worth $4 billion.

An unnamed source told the Wall Street Journal that the investment banking group is thought to be in “advanced talks” with the organisation, which is run by two former traders from Goldman Sachs.

Assets in the fund include $2.5 billion which Citi advises on, $500 million in capital tied to hedge fund stakes and $1 billion worth of hedge fund investments.

Details of the deal, including how much SkyBridge would be willing to pay, have yet to be disclosed, the news provider reported.

Citigroup announced during 2009 that it would be looking to offload $715 billion worth of assets in a bid to reduce its exposure to risk and the bank is thought to still have more than $500 billion to shift.

According to the news provider, Citigroup has sold a number of assets including stakes in the Japan-based Nikko Cordial securities and Nikko asset-management businesses.

The sale of its Smith Barney brokerage business and consumer finance businesses in Portugal, Italy and Norway have also taken place as the bank attempts to recover in the wake of the global financial crisis.

Fund-of-fund investments in Citigroup increased in 2009 by more than 20 per cent, the news provider stated.

Posted in Finance Fraud

Tags: 1 Billion, Asset Management, Assets, Brokerage Business, Business Worth, Citigroup, Consumer Finance, Crisis Fund, Finance Businesses, Fund Business, Fund Investments, Global Financial Crisis, Goldman Sachs, Hedge Fund, Investment Banking Group, Nikko, Smith Barney, Unnamed Source, Wall Street, Wall Street Journal

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George Washington Bank fails; Ohio’s FirstMerit takes over

February 20th, 2010

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George Washington Savings Bank in Orland Park, Illinois was closed by state banking regulators, with Akron, Ohio-based FirstMerit Bank acquiring all the deposits and virtually all of the assets of the 120-year-old bank.

George Washington is the second Chicago-area bank to fail so far this year.

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Posted in Finance Fraud

Tags: Acquisition, Akron Ohio, Assets, Bank Failures, Banking Operations, Banks, Ceo, Chicago Area, Collapse, Fdic, Federal Deposit Insurance, Federal Deposit Insurance Corp, Firstmerit Bank, George Washington, Losses, Oak Lawn, Orland Park Illinois, Paul Greig, Regulators, South Suburban

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Chinese hacker school shut down – v3.co.uk – 8 Feb 2010

February 10th, 2010

Before You Invest

A report in the China Daily newspaper claims that the country’s biggest hacker training site has been shut down by the authorities.

The paper said that three people have been arrested, and that assets to the value of ¥1.7m (£160,000) have been seized, suggesting that the site was big business.

The Black Hawk Safety Net site was set up in 2005, and had some 12,000 members, all of whom may have paid up to ¥2,000 (£190) for training in hacking and other online criminal activities.

A further 170,000 people were registered on the site, but had not paid a fee and had received only low level hacking tips and tricks, according to the report.

The authorities seized a number of web servers, five computers and a car.

China’s recently created anti-hacking laws make it illegal to attack software and other computer programs.

However the country’s reputation has recently been tarnished by allegations that hackers from the region have been involved in cyber attacks on Google and UK businesses.

By David Neal

Posted in Finance Fraud

Tags: Allegations, Assets, Authorities, Black Hawk, Chinese Hacker, Computer Programs, Cyber Attacks, Five Computers, Google, Google Uk, Hacker School, Hacker Site, Hacker Training, Hackers, Hacking Tips, Hawk, Reputation, Tips And Tricks, Uk Businesses, Web Servers

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Fraud Defendant Lands in Jail for Failure to Comply with Court Order

January 27th, 2010

Before You Invest

Earlier this week Trevor G. Cook, a onetime money manager charged with operating a foreign currency trading scheme, was jailed for being in contempt of court. A federal judge in Minnesota had been trying to enforce an order granted to the Securities and Exchange Commission (SEC) forcing Cook to hand over more than $35 million in assets when Cook’s unwillingness to comply landed him in jail.

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Posted in Finance Fraud

Tags: Assets, Chicago Regional Office, Contempt Of Court, Defendant, Faberge Eggs, Federal Judge, Foreign Currency Trading, Fraud, Gillete, Investor, Luxury Cars, Money Manager, Offshore Accounts, Radio Host, Securities And Exchange, Securities And Exchange Commission, Securities Products, Selling Unregistered Securities, Shell Companies, Submarine

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Haiti: A Note of Caution When Considering a Donation

January 19th, 2010

Before You Invest

In the outpouring of private aid in response to the earthquake in Haiti last week, there are the inevitable scammers who seek to cash in on others’ generosity. In response to this eventuality, Investment News is reporting that advisers are recommending that their clients give to well known organizations.

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Posted in Finance Fraud

Tags: Advantage, Assets, Caution, Documentation, Earthquake, Eventuality, Exercise, Generosity, Haiti, Investment News, Money, Money Changes Hands, Outpouring, Private Aid, Scammers, Tax Purposes, Telemarketer, Telemarketers

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Obama plans to propose fee for top banks

January 14th, 2010

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President Barack Obama is set to announce today a proposal to assess a fee on large financial institutions to recoup money lost from the Troubled Asset Relief Program. The “financial crisis responsibility fee” would target financial institutions with more than $50 billion in assets, an administration official said.

more at http://www.nytimes.com/2010/01/15/us/15tax.html

Posted in Finance Fraud

Tags: Administration Official, Assets, Banks, Barack Obama, Financial Crisis, Financial Institutions, Financial Responsibility, Money, Proposal, Relief Program

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Fed makes record profit, will return $45 billion to Treasury

January 12th, 2010

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The Washington Post calculated that the Federal Reserve will return about $45 billion to the Treasury Department after earning a record profit because of its unconventional initiatives to boost the economy. “This shows that central banking is a great business to be in, especially in a crisis,” said Vincent Reinhart, a former official at the Fed and a resident scholar at the American Enterprise Institute.

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Posted in Finance Fraud

Tags: American Enterprise Institute, Assets, Central Banking, Economy, Federal Reserve, Initiatives, Record Profit, Reinhart, Resident Scholar, Treasury Department, Washington Post

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Iceland’s president refuses to sign repayment bill

January 6th, 2010

Before You Invest

Iceland’s president Olafur Grimsson has refused to sign a bill to repay more than $5 billion to British and Dutch investors who lost money in the country’s failed banks.

It is only the second time in the country’s history that the president, a largely symbolic figurehead, has refused to sign a bill into law, reports Reuters.

Under the state’s rules, the bill will now be put to a nationwide referendum.

The bill was passed by the nation’s parliament in an attempt to improve Iceland’s international standing as financial aid is vitally needed to help the country recover from its financial meltdown.

But many voters were angered by the decision, leading Mr Grimsson to make his stand.

“The people must be convinced that they themselves determine the future course,” he said. “The involvement of the whole nation in the final decision is therefore the prerequisite for a successful solution, reconciliation and recovery.”

There is great anger against the UK for using anti-terror legislation last year to freeze Icelandic assets at the height of the crisis, reports the Telegraph.

Almost 50,000 people in the country, around 25 per cent of the adult population, have signed a petition calling for the bill to be scrapped.