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Mar 13, 2013

CFTC looking into London gold, silver price setting: GATA | THE GATA DISPETCH MARCH 13, 2013.

CFTC looking into London gold, silver price setting

Submitted by cpowell on 03:36PM ET Wednesday, March 13, 2013. Section: Daily Dispatches
By Katy Burne
The Wall Street Journal
Thursday, March 13, 2013
The U.S. Commodity Futures Trading Commission is scrutinizing whether the daily setting of gold and silver prices in London is open to manipulation, according to people familiar with the situation.
No formal investigation has been opened, the people said. The CFTC is examining various aspects of the price settings, including whether they are sufficiently transparent, they said.
Gold prices are set twice daily by five banks via teleconference, while three banks set silver prices. These so-called fixings are then used to determine spot prices worldwide, affecting everything from jewelry to sales from mining companies to refineries. The prices also help determine the value of derivative securities tied to the metals.
Global interest-rate benchmarks also are determined using a bank price-setting process. An investigation by regulators worldwide into one of those benchmarks, the London interbank offered rate, known as Libor, uncovered alleged manipulation and triggered multibillion-dollar fines against three banks. 
 The London gold market pricing process dates from 1919, and now has twice-daily conference calls involving units of five banks: Barclays, Deutsche Bank AG, HSBC Holdings, Bank of Nova Scotia, and Societe Generale.
The silver setting, dating from 1897, involves Bank of Nova Scotia, Deutsche Bank, and HSBC.
Spokespeople for Barclays, HSBC, and Deutsche Bank had no immediate comment. Representatives from the other two banks couldn't immediately be reached.
The fixings are "not arbitrary. It's very much done on a demand-supply basis until a price is arrived at," said a spokesman for the London Bullion Market Association, the trade organization that sets the standards for the quality of gold and silver traded in the London market, but doesn't run the fixings. "It's fully transparent; it's nothing like Libor," he said.
The scandal involving Libor, a rate used to price everything from corporate loans to home mortgages, saw traders allegedly provide manipulated data to the industry organization that publishes the benchmark rate in an effort to create profitable trades.
More than a dozen financial firms are under investigation in the rate probe, and three banks, Barclays, Royal Bank of Scotland Group, and UBS AG, have settled for a combined $2.5 billion. Regulators are pushing for greater transparency in how benchmark interest rates are set.
CFTC Chairman Gary Gensler is co-chairman of a task force on financial-market benchmarks within the International Organization of Securities Commissions along with Martin Wheatley, managing director at the U.K. Financial Services Authority. The group plans to issue a new set of guidelines for benchmarks this spring. In January, it published an initial set of comments on financial benchmarks.

* * *

Banks Bow to New York on Clawbacks: The Wall Street Journal Markets Alert



By LIZ MOYER
 
Three more top banks, including Citigroup Inc., C +0.04% will broaden their clawback policies to cover more executives, increase disclosures or add potential triggers.
The moves increase to six the number of leading financial companies that have bowed to pressure from the New York City's Comptroller's Office.
Comptroller John C. Liu also appears to have broken new ground, with Capital One Financial Corp. COF +0.05% agreeing to make public the total dollar amount of pay it claws back.
 
Agence France-Presse/Getty Images
 
Capital One will become the first bank to make public the amount of pay it claws back from executives.
The sixth-largest U.S. bank will disclose how much it recouped from errant workers, so long as the event that triggered the collection has been publicly disclosed in regulatory filings, a spokesman for Mr. Liu said. It is believed to be the first company to agree to disclose clawback dollar amounts.

The agreements, which Mr. Liu's office plans to announce on Thursday, come after four months of negotiations. As comptroller, Mr. Liu oversees New York City's pension funds, which are major shareholders of the banks.

In addition to Capital One and Citigroup, Wells Fargo WFC +0.30% & Co. also agreed to broaden clawback policies to cover misconduct that causes financial or reputational harm, although the Citi and Wells changes are less expansive than Capital One's, the spokesman said.

The new policies also cover supervisors, similar to agreements New York City's pensions struck last year with Goldman Sachs Group Inc., GS +0.04% Morgan Stanley MS +0.49% and J.P. Morgan Chase JPM -0.24% & Co.

Clawbacks have taken on added scrutiny nearly a year since J.P. Morgan took a $6.2 billion trading hit in what has become known as the "London whale" blunder.

J.P. Morgan clawed back two years of total annual compensation, including restricted stock, and canceled options grants, from three London-based managers who had direct responsibility for the trading portfolio at the heart of the losses. Ina Drew, the executive who ran the Chief Investment Office where the losses occurred, volunteered to return her pay to the maximum amount allowed by the bank.

The bank also has recouped other employee pay but hasn't disclosed details or the dollar amounts for any clawbacks.
Before the "London whale" there weren't many known cases of clawbacks in the financial sector. The Dodd-Frank financial law broadened the rules instituted in the 2002 Sarbanes-Oxley Act, which gave companies the power to recoup pay from top executives after a financial restatement or certain misconduct.
In February 2012, UBS AG UBSN.VX -0.33% clawed back 50% of share-based bonuses awarded in 2011 to investment bankers whose bonuses exceeded $2 million.

That followed a trading scandal that cost $2.3 billion and pushed UBS to a $1.3 billion loss for 2011.
New York City's pensions hold 1.6 million shares of Capital One, 7.4 million shares of Citi and 11.7 million shares of Wells Fargo, worth $87.4 million, $347.5 million and $430 million, respectively, as of Wednesday's market close.

"The new policies will give boards the power to hold executives financially accountable for costly misconduct, including misconduct by those they supervise," Mr. Liu said in a statement.
Spokesmen for Capital One and Citi declined to comment.

A Wells Fargo spokeswoman said the comptroller's proposal was "consistent with our thinking on the subject, and we appreciate the productive dialogue we had with our shareholder."

Mr. Liu's office has been pressing banks to disclose when and how much they claw back. Capital One is believed to be the first company to specifically agree to do so, he said. Citi and Wells Fargo agreed to consider disclosure on a case-by-case basis.

Capital One's previous clawback provisions covered only its top executive officers and triggered only in the event of a financial restatement or willful misconduct. Its new policy covers conduct of the firm's 12 executive officers and holds them accountable for events that occur under their chain of command.

Citi's revised clawback policy recoups pay where executives are responsible for material financial or reputational harm, either through their own actions or in failing to supervise others.

Wells Fargo's revised policy takes back unpaid compensation awards in the event of misconduct, material error, failure to supervise or in the event the company or an individual executive's business group has a material downturn in financial performance or failure of risk management.

Write to Liz Moyer at liz.moyer@dowjones.com
 

The New Pope: Bergoglio of Argentina: NYT | Global Update March 13, 2013

The New York Times International Herald Tribune
March 13, 2013
Compiled 20:47 GMT

Global Update

TOP NEWS

The New Pope: Bergoglio of Argentina

By RACHEL DONADIO
In selecting Jorge Mario Bergoglio, 76, the first non-European pontiff in more than 1,000 years, the cardinals sent a strong message that the church's future lies in the Southern Hemisphere.
The Lede Blog

Latest Updates

By THE NEW YORK TIMES
The official papal Twitter feed has become active again; the new pope led a prayer for his predecessor.
News Analysis

Karzai Bets on Vilifying U.S. to Shed His Image as a Lackey

By ALISSA J. RUBIN
In what is expected to be his final year in office, President Hamid Karzai is intensifying his criticism of his American allies at a critical moment in their Afghan endgame.
World

Graphic: The Catholic Church Shifted Southward Over the Past Century

In 1900, two-thirds of the world's Catholics lived in Europe. Today only 20 percent do.
Opinion

Latitude

Secularism, the Arab Way

By ISSANDR EL AMRANI
The Islamists might have scored major electoral victories since the Arab Spring, but a new openness about debating religion has come to the region.
WORLD

Vatican Reveals Recipes for Conclave Smoke

By HENRY FOUNTAIN
Fairly standard pyrotechnical formulas are behind the white and black smoke used to signal the results of the balloting.

Syria Military Shows Strain in a War It Wasn't Built to Fight

By ANNE BARNARD
The conflict has pushed a military built for repelling an Israeli invasion, not carrying out sustained asymmetrical combat, to scale back its goals and rethink its tactics.

Chinese Activist, Now in U.S., Cites Harassment of Family

By CHRIS BUCKLEY
Almost a year after Chen Guangcheng was released to the United States, he said that his family remains under surveillance in China, and his jailed nephew has been beaten.
BUSINESS

Europe Seeks Update of Law on Fliers' Rights

By NICOLA CLARK
For flights originating in Europe, new rules would clarify passengers' rights to compensation for delays or cancellations.
Bits Blog

Google Puts Android and Chrome Under One Boss

By CLAIRE CAIN MILLER
Google replaced Andy Rubin, who co-founded and oversaw Android, with Sundar Pichai, senior vice president for Chrome and Apps, signaling new thinking about hardware and mobile.
Wheels Blog

Henrik Fisker Resigns From Fisker Automotive

By BRADLEY BERMAN
The company has been plagued by business and technical problems, including two recalls, disappointing fuel-economy ratings, limited all-electric range and mixed reviews of its Karma sedan.
TECHNOLOGY

Google Concedes That Drive-by Prying Violated Privacy

By DAVID STREITFELD
In agreeing to settle a case brought by 38 states over the Street View mapping project, the company for the first time is required to aggressively police its own workers on privacy issues.

Google Selects New Chief for Android Unit

By REUTERS
Andy Rubin, who built Android into a software platform used by most of the biggest phone makers, is handing over the reins.

Android Devices Set to Overtake iPad in Market Share

By REUTERS
A growing variety of Android tablets will catch on this year, chipping away at Apple's dominance, the research firm IDC said.
SPORTS

A Night When Barcelona Banished All Doubts

By ROB HUGHES
The Spanish club had it all when it beat Milan to advance in the Champions League: Lionel Messi looking as good as ever, David Villa looking like the old sniper, and the club dominating the ball.
USA 7, Puerto Rico 1

Dominican Republic Wins Again but Remains Wary of U.S.

By TIM ROHAN
The United States capped a six-run victory over Puerto Rico on Tuesday in the World Baseball Classic to set up a meeting with the Dominican Republic.

Nibali Wins Again in Italy

By THE ASSOCIATED PRESS
Vincenzo Nibali has defended his title in the Tirreno-Adriatico race in Italy, finishing 23 seconds ahead of Chris Froome, the Tour de France runner-up.
U.S. NEWS

Case Already Tried in Social Media Heads to Court

By ERICA GOODE and NATE SCHWEBER
Two high school football players in Steubenville, Ohio, face charges of raping a 16-year-old girl last summer in a case that has already played out online for months.

L.A. Archdiocese and Cardinal Mahony Settle Sex Abuse Cases

By REUTERS
The Roman Catholic Archdiocese of Los Angeles, its former leader, Roger Mahony, and a former priest have agreed to pay nearly $10 million to settle four child sex abuse cases.

California Bill Seeks Campus Credit for Online Study

By TAMAR LEWIN
Legislation in California would require universities to honor faculty-approved online courses taken by those unable to register for classes on campus.
OPINION
Op-Ed Contributors

The Facts on Fracking

By SUSAN L. BRANTLEY and ANNA MEYENDORFF
Environmentalists should consider the pros and cons of fracking in comparison with other technologies.
Op-Ed Columnist

Mr. Obama Goes to Israel

By THOMAS L. FRIEDMAN
Here are a few questions the president might ask on his visit to Israel next week.
Op-Ed Contributor

Is Any Hope Left for Mideast Peace?

By RASHID KHALIDI
The Israeli-Palestinian "peace process" has actually helped make peace less attainable than ever.

Having None of Having It All : NYT | Opinion Today March 13, 2013

The New York Times

March 13, 2013

Opinion Today

Having None of Having It All
Opinionator | The Conversation

Having None of Having It All

Brooks and Collins argue about Sheryl Sandberg, "The Bachelor" and the papal election.
Op-Ed Contributor

Is Any Hope Left for Mideast Peace?

By RASHID KHALIDI
The Israeli-Palestinian "peace process" has actually helped make peace less attainable than ever.
Op-Ed Contributor

The Old Peace Is Dead, but a New Peace Is Possible

By ARI SHAVIT
As Arabs and Israelis book look inward, the chance for a New Peace emerges - not lofty declarations, but a pragmatic, gradual process that advances mutual needs and interests.
A Food Market for New York
Opinionator

A Food Market for New York

By MARK BITTMAN
The city has a chance to do something on Fulton Street that would benefit us all.

The Benefits of Mobile Health, On Hold
Opinionator | Fixes

The Benefits of Mobile Health, On Hold

By TINA ROSENBERG
Despite the availability of mobile health programs, they've floundered in developing countries.
Op-Ed Contributor

Preventing an Arctic Cold War

By PAUL ARTHUR BERKMAN
Melting ice raises the potential for conflict.
Mary and the Zombies: Can Science Explain Consciousness?
Opinionator | The Stone

Mary and the Zombies: Can Science Explain Consciousness?

By GARY GUTTING
Is a purely physical, scientific account of subjective experience possible?
Judgment on Campus or in a Court of Law?
Room for Debate

Judgment on Campus or in a Court of Law?

Should colleges be dealing with rape accusations by students or should that be left to police and prosecutors?
The War Comes Home to Indiana
Opinionator | Disunion

The War Comes Home to Indiana

By STEPHEN E. TOWNE
Rampant desertion in 1863 leads to a standoff between Army officials and antiwar locals.
Secularism, the Arab Way
Latitude

Secularism, the Arab Way

By ISSANDR EL AMRANI
The Islamists might have scored major electoral victories since the Arab Spring, but a new openness about debating religion has come to the region.
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Editorial

The Worst of the Ryan Budgets

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Editorial

Sexual Assaults and Military Justice

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Editorial

Mayor Bloomberg's Anti-Obesity Campaign

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Editorial

Good News on the Shark Front

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The Opinion Pages

Read the full opinion report, including editorials, columns, op-eds and Opinionator. Go to the Section »
Obama Continues Evolving
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Obama Continues Evolving

By ANDREW ROSENTHAL
The president now seems to think that state bans on same-sex marriage are unconstitutional.
Nicholas D. Kristof Blog

The Forgotten Malala

By SEEMA JILANI
Guest blogger Seema Jilani writes about a Pakistani girl who, after being shot alongside Malala Yousafzai last year, is struggling under threats from the Taliban.
The Ryan Budget's Step Backward
Evaluations

The Ryan Budget's Step Backward

By ROSS DOUTHAT
The latest Ryan roadmap offers too much implausibility, not enough creativity.
Can Wind, Water and Sunlight Power New York by 2050?
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Can Wind, Water and Sunlight Power New York by 2050?

By ANDREW C. REVKIN
A group of researchers proposes a way to power New York State entirely with wind, water and sunlight by 2050.
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DealBook P.M. Edition March 13, 2013.: Witness List Set for Senate Hearing on JPMorgan Trading Loss




Wednesday, March 13, 2013
TOP STORY
Witness List Set for Senate Hearing on JPMorgan Trading Loss Doug Braunstein, who was the bank's chief financial officer at the time of the losses, is scheduled to appear, as is Ina Drew. Jamie Dimon, the bank's chief, will not testify.
  • DEALBOOK »
  •  
  • TOP STORY
    Witness List Set for Senate Hearing on JPMorgan Trading Loss Doug Braunstein, who was the bank's chief financial officer at the time of the losses, is scheduled to appear, as is Ina Drew. Jamie Dimon, the bank's chief, will not testify.
     
    DEALBOOK HIGHLIGHTS
    Former Pimco Executive Files, Then Withdraws, Suit Alleging Misconduct A former high-yield bond portfolio manager at Pimco claimed that he had witnessed multiple instances of wrongdoing by the firm's senior management from late 2008 to early 2009.
    Outdoor Channel Agrees to Higher Bid From Kroenke Outdoor Channel Holdings has accepted a $220.7 million takeover bid from Kroenke Sports and Entertainment, turning down an earlier offer from the media investor Leo Hindery Jr.
    Commerzbank to Raise Capital and Pay Back Bailout The moves would reduce the German government's influence over the bank, but would also dilute current shareholders.
    Happy Birthday, Jamie Dimon Jamie Dimon, JPMorgan Chase's chief executive, turned 57 on Wednesday. It was five years ago to the day that Mr. Dimon was asked to make one of the biggest deals of his career: buying Bear Stearns.
    White Collar Watch: After Financial Crisis, Prosecutors Navigate Tricky Waters Peter J. Henning says that the dearth of prosecutions since the financial crisis is again stirring controversy, but there is still time for political leaders to hold corporate executives responsible when a company engages in misconduct.
    More Companies Holding Annual Board Elections, Group Reports After prompting by shareholders, 46 companies in the Standard & Poor's 500-stock index have agreed to hold annual elections for all their directors, a corporate governance initiative run out of Harvard Law School said on Wednesday.
    Breakingviews: The Case for Shaking Up Hewlett's Board Robert Cyran says that replacing several directors responsible for H.P.'s past missteps would bring some accountability to the board and ensure an uncomfortable breakup of the company is not pushed aside.
    Buzz Tracker
    Vodafone Should Seek Sale of Company, Fund Manager Says Talk that Vodafone may sell its stake in Verizon Wireless to Verizon has excited a number of Vodafone shareholders. Not so John Hempton, the chief investment officer of the hedge fund of Bronte Capital.
    LOOKING AHEAD
    Economic Reports Information to be released on Thursday includes weekly jobless claims, the Producer Price Index for February and the current account deficit for the fourth quarter.
    In the United States On Thursday, Samsung Electronics is expected to introduce the latest model of its Galaxy S smartphone in New York; the Federal Reserve is scheduled to announce which banks have the ability to pay dividends and buy back shares; the House Agriculture Committee will conduct a hearing on legislative improvements to the Dodd-Frank Act; and a House Judiciary subcommittee will conduct a hearing about abusive patent litigation.
    Overseas On Thursday, global regulators will meet in Basel, Switzerland, to discuss revisions to capital and liquidity rules for banks. On Thursday and Friday, European Union leaders will meet in Brussels to discuss the debt crisis, bank regulation and other matters.

    Quotation of the Day
    "They might erase losses from previous bad risk management but that doesn't mean their risk management going forward will be any better,"
    Nicolas Véron, a senior fellow at Bruegel, a research organization in Brussels, on Commerzbank's efforts to raise and repay taxpayer money.