Merchant and Investment Banking

Robert Khuzami, Director of the SEC’s Division of Enforcement, U.S. Securities and Exchange Commission explains the latest action against officers of Credit Suisse

When Saxo Bank entered the Australian market in 2004, it did so by providing a trading platform for capital markets brokers. Its primary "white label" broker client was Sonray Capital Markets which subsequently failed. Now, SAXO is to change the way it operates in Australia and has agreed to new conditions on its licence. The case is a lesson to those who faciliate business but do not necessarily conduct business on their own account.

Following HSBC and RBS's announcement of major layoffs in their investment banking divisions, London yesterday saw Citi's UK offices start to wave goodbye to a large number of staff.

Christian Littlewood, a senior investment banker and former UK Financial Services Authority (FSA) Approved Person, his wife Angie Littlewood (also known as Siew Yoon Lew and Angie Lew) and a friend Helmy Omar Sa’aid have pleaded guilty to 8 counts of insider dealing contrary to section 52 of the Criminal Justice Act 1993. They are alleged to havme made approximately GBP590,000 profit from the trades.

An action begun on 21 December 2010 by New York Attorney General Andrew Cuomo claims that for more than seven years leading up to Lehman’s insolvency filing in September 2008, Lehman had engaged in so-called “Repo 105” transactions, explicitly approved by Ernst & Young (E&Y). The action under The Martin Act alleges that E&Y "helped Lehman Brothers Holding, Inc. (“Lehman”) engage in an accounting fraud involving the surreptitious removal of tens of thousands of millions of dollars of fixed income securities from Lehman’s balance sheet in order to deceive the public about Lehman’s true liquidity condition."

A UK company, PharaTelevision, says that it's found a way to help pharmaceutical and bio-technology companies make their funding pitches direct to "key decision makers in the financial sector."

The news that the USA's Securities and Investment Commission has issued civil proceedings against Goldman Sachs over its products based in the sub-prime crisis should be a surprise in three respects only: first that it's only Goldmans in the firing line secondly that it's taken so long and third that it's the SEC and not criminal investigators leading the charge. But, as Sun Tzu did not say "if you can't attack, divert" - that's what the SEC was doing with its announcement.

A report by Reuters says that GBP5,000 million has been raised from nine banks to fund Kraft's proposed buy-out of Cadbury's.

The Bank of New York Mellon Corporation has agreed to acquire Insight Investment Management Limited ("Insight Investment") from Lloyds Banking Group plc for GBP235 million.

Financial Services Secretary Paul Myners today published a report setting out the Government’s initial thinking on reforms to strengthen the UK's ability to deal with the failure of an investment bank