CFTC and SEC Binary Options Enforcement Actions; SEC sues Tesla

Sep 28, 2018

First Read

Hits & Takes
JLN Staff

Part 2 of my interview with Eurex as part of their 20th anniversary celebration was published yesterday.~JJL

Today is your last day to save on #FIAExpo registration. Keynote speakers include New Power author Jeremy Heimans and CFTC Chairman Christopher Giancarlo. ~JJL

Bloomberg reported that Elon Musk Wanted to Impress Girlfriend With $420 Price, SEC Says.” No word on whether he first said, “Here, hold my beer and watch this!””~JJL

The City of London plans to restrict traffic on some key roads in order to accommodate more people working in the area in coming years. ~SD

Stacey Cunningham and the NYSE hosted the Prime Minister of Italy, Giuseppe Conte, yesterday at the exchange.~JJL

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John Lothian: “For Eurex, the sky is the limit” (part II)
Eurex
In the second part of our interview with John Lothian, founder and owner of MarketsWiki, publisher of John Lothian News and long-time chronologist of the financial markets, we learn about his relationship with the Eurex management as well as the risks and chances he sees for Eurex.
/jlne.ws/2DL1rzk

***** Now I have to get new business cards with “Chronologist” on them.~JJL

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Boris and Brexit gym punchbags help Londoners vent their rage
Reuters
Londoners fed up with Brexit can vent their rage with a special gym routine that includes high-intensity exercises like pummeling punchbags bearing photographs of some of the main players like Boris Johnson and Jean-Claude Juncker.
/reut.rs/2xZRAj4

****No word yet on how much these “Brexfit” classes cost.~SD

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Where is Starman? Track Elon Musk’s Tesla Roadster in Space!
Elon Musk may be having some problems with the SEC here on Earth but his car is now orbiting somewhere beyond the orbit of Mars.
Among other trivia from the website: “Assuming the battery still works, Starman has listened to “Space Oddity” 63,408 times since launch in one ear, and to “Is there Life On Mars?” 85,439 times in the other ear.” (Note: Those numbers automatically update as time passes.)
bit.ly/2zAImM8

**** In space, no one can hear Musk scream.~JB

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Order the Steak, Client Meal Deductions Will Be Allowed; IRS expected to release guidance on entertainment, dining expense write-offs
Laura Saunders – WSJ
Breathe a sigh of relief if you take clients out for business meals. The Internal Revenue Service is expected to release guidance soon saying these meal expenses can often continue to be 50% deductible, according to people familiar with the matter.
/jlne.ws/2DBy9TZ

***** What about the $700 bottle of wine with dinner?~JJL

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Thursday’s Top Three
Sometimes a picture is worth a whole story. Our top item of the day was the picture of all five CFTC Commissioners. Can you name them? Second went to The Block piece on who is hiring, in Chicago crypto trading shops are going on a hiring spree. Third was Bloomberg’s Crypto’s Open Secret: Its Multibillion-Dollar Volume Is Suspect

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MarketsWiki Stats
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CryptoMarketsWiki Website»
CryptoMarketsWiki, our archive of the cryptocurrency and blockchain world, is going strong and keeping pace as this area of finance grows and evolves.

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Lead Stories

CFTC Files Ten Enforcement Actions: Nine Addressing Fraudulent Binary Options Solicitations and One Addressing Cross-Exchange Manipulation
CFTC
The Commodity Futures Trading Commission (CFTC) issued seven orders today filing and simultaneously settling charges against various respondents, and also filed two complaints against various defendants, for violations of the Commodity Exchange Act (CEA) and Commission Regulations (Regulations) relating to fraudulent binary options solicitations, and one order filing and simultaneously settling charges for violations of the Act and Regulations relating to cross-exchange manipulation, as set forth below and as more fully described in the related press releases linked below.
/jlne.ws/2zAE1Zz

Online Marketers Charged With Conning Main Street Investors Through Rags-to-Riches Infomercials; SEC Issues Video Warning to Investors
SEC
The Securities and Exchange Commission today charged a group of internet marketers who allegedly created and disseminated elaborate rags-to-riches videos to trick retirees and other retail investors into opening brokerage accounts and trading high-risk securities known as binary options.
/jlne.ws/2DDJoLE

CFTC Charges Eleven Individuals and Five Entities in Nationwide Binary Options Fraud Ring; As alleged in two complaints and seven orders, hundreds of millions of prospective customers received fraudulent binary options solicitations from Defendants and Respondents
CFTC
The Commodity Futures Trading Commission (CFTC) today announced that it filed two complaints in federal district courts in Florida against four individuals and three entities and issued seven administrative Orders filing and simultaneously settling charges against seven individuals and two entities relating to global retail binary options fraud that victimized U.S. residents.
/jlne.ws/2DFh4IH

Elon Musk Sued by the SEC for Securities Fraud; Regulators accuse him of misleading shareholders when he said he had funding for a corporate buyout.
Dave Michaels – The Wall Street Journal
Securities regulators on Thursday sued Tesla Inc.TSLA founder Elon Musk for fraud, charging that he misled shareholders in August when he said he had funding for what would have been the largest-ever corporate buyout.
/goo.gl/TXKaio

****For more, see Reuters, the SEC press release, Yahoo Finance and the Financial Times. In the wake of the news – no surprise – Tesla shares dropped.

Eurex plans speed bumps to favour traditional investors – CEO
Reuters
Futures exchange Eurex will impose a speed limit on trading from December that seeks to restore the balance between high-frequency traders and traditional investors, its CEO told Germany’s Boersen-Zeitung.
/goo.gl/U2EZgy

Fed chief Powell signals central bank is done with signaling
Ann Saphir – Reuters
Federal Reserve Chairman Jerome Powell has a new message for financial markets: watch the data on jobs, wages and inflation for signals on monetary policy – not the U.S. central bank’s words or forecasts.
/jlne.ws/2zCidNc

Banker’s Arrest Puts Boom Years Under Scrutiny at Swiss Bank
Jan-Henrik Foerster and Hugo Miller – Bloomberg
Locked up in a jail cell at the height of a humid Florida summer, former Julius Baer banker Matthias Krull didn’t take long to crack and plead guilty to money-laundering charges.
/jlne.ws/2zC6Ftj

The End of the Tick Size Pilot
Themis Trading Blog
After two years, the tick size pilot will end after the close of trading today. While the goal of the tick pilot (increased small cap liquidity) was noble, the preliminary results appear to show that the goals were not accomplished. However, before the industry declares the pilot a waste of time and money (some have estimated it cost hundreds of millions of dollars), it’s important to realize that the pilot has yielded two years of data which can now be analyzed by researchers. We hope that the analysis not only shows what worked and what didn’t work but also gives reasons for certain failures.
/goo.gl/j5xp3u

Insider Trading’s Odd Couple: The Goldman Banker and the NFL Linebacker; Damilare Sonoiki and Mychal Kendricks looked like they had it all. They made a bad team.
Max Abelson, Felix Gillette – Bloomberg
When Mychal Kendricks darted past the Chicago Bears line earlier this month and sacked their quarterback, the Seattle Seahawks linebacker crawled across the turf, smacked it, leaped into the air, and twirled. Mics for the Monday Night Football game picked up a stretched-out scream of joy.
/jlne.ws/2DKQcXE

My naive part in Lehman’s downfall; John Gapper: I was wrong to call for the bank to be allowed to fail
John Gapper – FT
Ten years ago, Jim Wilkinson, then US Treasury chief of staff, sent a distressed email to a fellow official. “I just can’t stomach us bailing out Lehman?.?.?.?will be horrible in the press.” Two days later, his boss Hank Paulson warned others on a conference call: “I can’t be Mr Bailout.”
/jlne.ws/2zD9Y3z

Exchanges, OTC and Clearing

Banks cry foul over LCH compression policy changes; Allocation of compression slots favours TriOptima over competitors, critics say
James Ryder – Risk.net
A fierce row is brewing in the arcane world of cleared swaps compression. LCH has come under fire for proposed changes to the way business slots are allocated between external providers of the critical service, with dealers claiming the plans could stifle competition. Banks are divided, however, on what should be done about it.
/jlne.ws/2zDlagv

Equity derivatives: Withdrawal of admission of eight Single Stock Futures and one equity option
Eurex
Following previous corporate actions, the Management Board of Eurex Deutschland took the decision to withdraw the admission of eight Single Stock Futures and one equity option according to Annex A and Annex B of the Attachment with effect from 1 October 2018.
/jlne.ws/2DCez9X

Public funding for start-ups made easier; Deutsche Bˆrse Venture Network cooperates with eligible
Deutsche Bˆrse
Technology start-ups can benefit from public funds: EU, federal and state governments grant loans and subsidies. But who offers exactly who and under what conditions? Members of the Deutsche Bˆrse Venture Network have an easier time here: the new cooperation partner, which can be funded, shows them the way through the complex variety of funding opportunities.
/jlne.ws/2DAmUeg

Exchange Seeks Views on Proposed Rule Changes Relating to Disclaimer or Adverse Opinion on Issuer’s Financial Statements
HKEX
Exchange proposes to require trading suspension if listed issuers publish financial statements with disclaimer or adverse audit opinion; Proposed Rule changes aim to enhance the quality and reliability of financial statements published by issuers; Deadline for responses is 30 November 2018
The Stock Exchange of Hong Kong Limited (the Exchange), a wholly-owned subsidiary of Hong Kong Exchanges and Clearing Limited (HKEX), today (Friday) published a consultation paper seeking feedback on a proposed suspension requirement for listed issuers with disclaimer or adverse audit opinion on their financial statements.
/jlne.ws/2DDHASS

HKEX to Expand its Stock Index Products with Total Return Index Futures
HKEX
HKEX to offer four Total Return Index Futures contracts from 5 November 2018; New futures will complement HKEX’s existing stock index products
Hong Kong Exchanges and Clearing Limited (HKEX) announced today (Friday) that it will introduce the following Total Return Index (TRI) Futures contracts on 5 November 2018 to meet the needs of fund managers and other market participants who use TRIs and complement its existing stock index products:
/jlne.ws/2DLX87g

Fintech

IHS Markit launches initial margin calculation tool for OTC derivatives
Hayley McDowell – The Trade
IHS Markit is set to launch a new initial margin calculation service for non-cleared derivatives across equities, interest rates, FX, credit and commodities. The tool will offer users risk sensitivity and margin calculations using models for valuing over the counter (OTC) derivatives, alongside market data and IHS Markit’s portfolio valuations service.
/goo.gl/jc78h6

Fintech Investors Balk at Funding Circle’s Optimistic IPO Hopes
Alastair Marsh – Bloomberg
European fintech entrepreneurs may have become too optimistic about the rewards from taking their companies public.
Funding Circle Holdings Plc was little changed in its first day of trading Friday after pricing its initial public offering at the bottom end of its price range. The eight-year-old British online loan provider’s IPO valued the company at 1.5 billion pounds ($2 billion), compared with an initial aspiration of as much as 2 billion pounds.
/bloom.bg/2xYZDg4

Forget Chocolate, Cheese And Watches: Fintech Could Be Switzerland’s Hottest Industry
Alison Coleman – Forbes
When you think of European fintech communities, cities like London, Dublin and Berlin are usually the ones that spring to mind. Hot on their heels, however, are the cities of Zurich, Geneva and Lausanne, and even sleepy towns like Zug, that are helping Switzerland evolve into a global fintech hub.
bit.ly/2xWdvHX

The importance of harnessing FinTech thinking
Finextra
The financial services ecosystem is transforming. While no organisation would deny the pressing need for digital transformation, I’m referring here to anther kind of change; the very structure of the financial services sector itself.
A new order is emerging. Fresh vigour is in evidence across the sector. It’s a time of considerable opportunity for those who embrace the need for fundamental change. It could also be a time of diminishing opportunities for those who don’t.
bit.ly/2xZJrer

SocGen buys fintech startup Treezor
Finextra
Societe Generale has acquired French Banking-as-a-Service platform Treezor as part of its “open innovation” strategy of cosying up to the fintech community. Financial terms of the deal were not disclosed.
bit.ly/2xV40bZ

Slack Actively Preparing for Early 2019 IPO
Maureen Farrell – The Wall Street Journal
Slack Technologies Inc. is actively preparing for an initial public offering in the first half of 2019, with an eye toward going public as soon as the first quarter, according to people familiar with the company’s plans.
/goo.gl/cv1hSZ

Cryptocurrencies

Tiberius Tests Its Metals in Crypto Backed by Copper, Gold
Jan-Patrick Barnert – Bloomberg
Swiss asset manager and commodities trader Tiberius Group AG is stepping into the $215 billion digital coin market by offering a new token backed by seven metals in a sale set for Oct. 1.
Aiming to distinguish its Tiberius Coin from the thousands that have no reference value, the company plans to make a market in the asset so that its value holds close to that of a price of a basket of copper, aluminum, nickel, cobalt, tin, gold and platinum.
/bloom.bg/2xXNSGL

Regulators Are Catching Up With The Crypto Boom
Julie Myers Wood – Forbes
Say goodbye to the under-regulated era of cryptocurrency. While crypto trading on the more mainstream exchanges is fueling the market, it’s also bringing greater scrutiny from regulators, as shown by the recent report by the New York State Attorney General’s office (OAG) on crypto exchange abuse, The Financial Action Task Force (FATF) announcements about upcoming crypto standards, and warnings to investors.
bit.ly/2xHnn9g

Bitmain IPO: Bitcoin and crypto giant hedges against the market
Echo Huang – Quartz
All the ups and downs of cryptocurrencies can make anyoneóeven the most bullish of crypto believersóreconsider putting all their eggs in one basket.
That seems to be the thinking of one of the world’s largest crypto companies, Beijing-based Bitmain Technologies, which filed for an IPO in Hong Kong on Sept. 26. Aspirations to go public have forced the secretive company to open up its books, revealing how its business has changed over the last three years.
bit.ly/2xZXJfs

Goldman Sachs Leads $25 Million Funding for Blockchain Startup Veem
Daniel Palmer – CoinDesk
Blockchain payments startup Veem has closed a $25 million funding round led by Goldman Sachs, it announced Wednesday.
The firm, which rebranded from Align Commerce alongside another $26 million Series B raise in 2017, also saw participation in the new strategic round from investors including GV (formerly Google Ventures), Silicon Valley Bank, Kleiner Perkins and Pantera Capital.
bit.ly/2xXNGY3

Startup Spotlight: Nori is creating a blockchain marketplace open to all to reverse climate change
Lisa Stiffler – GeekWire
Seattle-based startup Nori is hoping to deliver what Al Gore, the Paris climate accord and others have not: a market-driven solution to not only curb greenhouse gas emissions, but actually remove planet-warming carbon from the atmosphere.
bit.ly/2OiSKjW

A Bitcoin Miner Tests Investor Appetite: What to Watch Today
Michael J. de la Merced – NY Times
Bitmain Technologies, a Chinese cryptocurrency company, confirmed on Thursday that it intends to go public in Hong Kong. It’s a big test of whether stock investors want to jump aboard the crypto bandwagon, despite the volatility of digital currencies.
/jlne.ws/2DDam68

SEC, CFTC Hits 1Broker Crypto Platform With Charges – Investors Worried
Nick Chong – Ethereum World News
On Wednesday afternoon, many investors in this industry were caught off-guard, as the American Securities And Exchange Commission (SEC), who has begun to take a growing role in the crypto asset space, revealed that it had charged 1pool Ltd, known as 1Broker to cryptocurrency investors.
Per an official release from the heavy-handed regulatory body, the SEC has charged the startup, along with its Austria-based CEO for “allegedly violating the federal securities laws in connection with security-based swaps funded with bitcoins.”
bit.ly/2xVlnK0

US House Passes Bill for Task Force to Combat Crypto Use by Terrorists
Helen Partz – CoinTelegraph
The U.S. House of Representatives passed a bill on September 26 that would establish a crypto task force to combat terrorist use of cryptocurrencies, public records indicate.
House Resolution (H.R.) 5036, which represents an amended version of the bill proposed by Rep. Ted Budd (R-NC) to the Committee on Financial Services in January, establishes an “Independent Financial Technology Task Force” to fight the illicit use of cryptocurrency.
bit.ly/2xUFmbJ

Politics

Trump’s election meddling charge against China marks U.S. pressure campaign
Matt Spetalnick, David Brunnstrom – Reuters
President Donald Trump’s accusation of Chinese meddling in upcoming U.S. elections marks a new phase in an escalating pressure campaign against Beijing that Washington is pursuing on multiple fronts, senior U.S. officials said on Thursday.
/jlne.ws/2zC2j5r

Trump said soybean prices have gone up. They’re near decade-lows.
Gina Heeb – Business Insider
President Donald Trump claims US soybeans have largely held up against his trade war with China. But tariffs have pushed prices to lows not seen since 2008.
“And soybeans are going up, and things are going up,” he said at a press conference in New York on Wednesday. “And we’ve had very little hurt, from what I’ve done. In fact, the markets have gone up, and the farmers are going to do great.”
/jlne.ws/2zByyl5

Special Report: As a Saudi prince rose, the Bin Laden business empire crumbled
Katie Paul, Tom Arnold, Marwa Rashad and Stephen Kalin – Reuters
Soon after Prince Mohammed bin Salman became second in line to the throne of Saudi Arabia, he turned his sights to the sprawling empire of the Saudi Binladin Group.
/jlne.ws/2zCFs9I

Hank Paulson Says China Trade War Risks Long-Term U.S. Pain
Dan Reichl and David Westin – Bloomberg
A trade war with China carries “dangerous” long-term risks because companies and nations may pull back from doing business with the U.S., former Treasury Secretary Henry Paulson said.
/jlne.ws/2zCLc3p

Secret Hedge-Fund Polls Imperil Market Integrity, U.K. MP Warns
Cam Simpson, Gavin Finch and Kit Chellel – Bloomberg
Morgan threatens regulations if poll industry fails to reform; Exit polls offer “profitable, and arguably unfair” advantage
Lucrative polls conducted in secret for hedge funds, revealed by a Bloomberg investigation into the 2016 Brexit vote, “risk damaging the reputation of U.K. financial markets,” the head of an influential parliamentary committee has warned.
/jlne.ws/2DAiTXe

Regulation

CFTC Charges Trading Platform with Illegal Transactions Margined in Bitcoin, Failing to Implement Procedures to Prevent Money-Laundering, and Failing to Register with CFTC
CFTC
The Commodity Futures Trading Commission (CFTC) today filed a civil enforcement action in the U.S. District Court for the District of Columbia against Defendants 1pool Ltd. (1pool), and its chief executive officer and owner, Patrick Brunner of Austria. The CFTC’s Complaint charges the Defendants with engaging in unlawful retail commodity transactions, failing to register as a Futures Commission Merchant (FCM), and supervisory violations for failing to implement procedures to prevent money laundering as required under federal laws and regulations.
/jlne.ws/2zAcUhe

CFTC Charges Futures Trader with Cross-Exchange Manipulation
CFTC
The Commodity Futures Trading Commission (CFTC) today issued an Order filing and simultaneously settling charges against Davis Ramsey, a Florida-based futures trader, for employing a manipulative scheme to influence the prices of certain futures contracts traded on the Chicago Mercantile Exchange, Inc. (CME) and Commodity Exchange, Inc. (COMEX), both Designated Contract Markets operated by the CME Group, Inc. (CME Group), to impact the outcome of related binary contracts traded on the North American Derivatives Exchange (Nadex).
/jlne.ws/2DDLATo

Trader Who Ripped Off His Mom, Friends Gets 8 Years
Bob Van Voris – Bloomberg
Michael Scronic’s Ponzi-like scam cost investors $22 million; Ex-Morgan Stanley trader blamed gambling addiction for crime
A former Morgan Stanley trader who ran a phony hedge fund from his rented home in the wealthy New York suburb of Pound Ridge, ripping off friends and even his mother, was sentenced to eight years in prison for the $22 million fraud.
/jlne.ws/2zCmpwq

Harbinger hedge fund manager to pay $30 million in New York tax accord
Jonathan Stempel – Reuters
An offshore hedge fund firm whose investing was led by money manager Philip Falcone will pay $30 million to resolve claims it knowingly evaded hundreds of millions of dollars of New York state and New York City taxes, officials said on Thursday.
/jlne.ws/2zBvNAh

U.S. returns $505 million to victims of giant payday lending scheme
Jonathan Stempel – Reuters
U.S. authorities said on Thursday they were mailing more than $505 million of refund checks to nearly 1.18 million people who were victimized in a massive payday lending scheme run by former race car driver and convicted racketeer Scott Tucker.
/jlne.ws/2zD87M9

Fraudsters bilked 75K investors with get-rich-quick videos: SEC
Kevin Dugan – NY Post
Federal securities regulators accused a group of online marketers of circulating get-rich-quick videos to commit a “massive fraud” that bilked 75,000 investors out of tens of millions of dollars.
/jlne.ws/2DEzUQ7

Prime broker to fight £400,000 FCA fine for market abuse; Linear Investments maintains there were no instances of market abuse that went undetected or unreported.
Hayley McDowell – The Trade
London-based prime broker Linear Investments is disputing a £409,300 fine imposed by the UK financial watchdog for alleged failures in its oversight of potential market abuse activity.
/jlne.ws/2DLTYQW

ESMA updates the Q&As on ESMA’s temporary product intervention measures
ESMA
The European Securities and Markets Authority (ESMA) has today updated its Questions and Answers on ESMA’s temporary product intervention measures on the marketing, distribution or sale of CFDs and binary options to retail clients based on Article 40 of Regulation (EU) No 600/2014 Markets in Financial Instruments Regulation (MiFIR).
/jlne.ws/2DCf1Fb

ESMA consults on stress testing rules for money market funds
ESMA
The European Securities and Markets Authority (ESMA) has today opened a public consultation on how European money market funds (MMFs) should conduct their internal stress testing. While MMFs invest in highly liquid and low risk short-term debt instruments, they play an important role in the financial system and are interconnected with other key market participants.
/jlne.ws/2DCgawt

ESMA to renew restriction on CFDs for a further three months
ESMA
The European Securities and Markets Authority (ESMA) has agreed to renew the restriction on the marketing, distribution or sale of contracts for differences (CFDs) to retail clients, in effect since 1 August, from 1 November 2018 for a further three-month period.
/jlne.ws/2DChgIB

FINRA Launches New SIE Exam to Streamline Examination Process for Prospective Candidates Entering the Securities Industry
FINRA
Starting Monday, October 1, FINRA will offer a new qualification exam – the Securities Industry Essentials (SIE) – for prospective candidates seeking to enter or re-enter the securities industry.
/jlne.ws/2DCHA5x

Proposed Rule Change Relating to Test Results Information on the Content Outlines of FINRA Qualification Examinations
FINRA
Financial Industry Regulatory Authority, Inc. (“FINRA”) is filing with the Securities and Exchange Commission (“SEC” or “Commission”) revisions relating to test results information on the content outlines of certain FINRA representative- and principal-level qualification examinations.
/jlne.ws/2DCIWx0

Investing and Trading

Cargill earnings drop despite jump in grain unit profits
Gregory Meyer – FT
Cargill, the world’s largest food commodities dealer, reported a nominal decrease in adjusted quarterly earnings, as weaker results in three of its divisions offset a jump in profit in its main grain trading and processing business.
/jlne.ws/2zzVOA6

“Smart Beta” ETFs Were All the Rage. Now Some Are Disappearing
Crystal Kim – Barron’s
A “smart” label on anything – water, phones, or exchange-traded funds – can make it seem more appealing. The fund industry can attest to that. Assets in smart-beta or factor-weighted ETFs have risen 30% every year since 2012, more than the entire passive-investing pie grew last year, according to the Boston Consulting Group. But the smart label could be losing its pull. Some of the biggest ETF shops are paring smart-beta funds from their lineups.
/jlne.ws/2zBz2HX

Global M&A volume flattens in Q3 as trade tensions loom
Liana B. Baker, Pamela Barbaglia – Reuters
Global mergers and acquisitions dropped to $783 billion in the third quarter, down 35 percent from the prior quarter, as the escalating trade dispute between the United States and China cast a shadow on the financial and regulatory prospects of some deals.
/jlne.ws/2zBNAHG

Institutions

Lehman’s Buyer Is on the Lookout for Another Crisis
Duncan Mavin and Francesco Guerrera – Barron’s
It has been 10 years since ex- Barclays chief Bob Diamond pulled off one of the biggest deals in investment-banking historyóbuying up most of Lehman Brothers at the height of the financial crisis.
/jlne.ws/2zCMBqH

Royal Bank of Scotland to launch new consumer bank: Sky News
Reuters
Royal Bank of Scotland is planning to launch a new standalone consumer bank called Bo to fight industry challengers such as the British app bank Monzo and digital bank Revolut, Sky News reported.
/jlne.ws/2zBvp4N

Moore Capital Is Opening Miami Office as Rich Eye Tax Break
Saijel Kishan and Katherine Burton – Bloomberg
Hedge fund’s Andrew Tytel, analysts to move to Sunshine State; Firms have set up offices in Florida after U.S. tax reform
Moore Capital Management is opening a Miami office next year as more wealthy investors move to Florida and other lower-tax states following the U.S. tax overhaul.
/jlne.ws/2zCFK0i

Regions

Danske Whistle-Blower Seeks Protection After Identity Revealed
Frances Schwartzkopff – Bloomberg
Lawyers for the Danske Bank A/S trader who blew the whistle on what is fast becoming one of Europe’s biggest money laundering scandals are asking authorities in Denmark and Estonia to provide protection after the man was identified by name in news reports.
/jlne.ws/2DOlH3t

Danske Scandal Enters Danish Debate Over EU Banking Union
Frances Schwartzkopff and Peter Levring – Bloomberg
Bankers’ lobby says case shouldn’t sway membership decision; Finance minister says government hasn’t made up its mind yet
The multibillion-dollar money laundering scandal enveloping Denmark’s biggest bank shouldn’t be a key factor in determining whether the country joins the European banking union, according to the head of the financial industry’s lobby group.
/jlne.ws/2DLREcG

35-Year-Old Unknown Creates the World’s Most Valuable Startup
Lulu Yilun Chen and Mark Bergen – Bloomberg
Bytedance’s said to be valued at over $75 billion in new round; SoftBank is said to plan an investment of about $1.5 billion
When Zhang Yiming first shopped the idea of a news aggregation app powered by artificial intelligence six years ago, investors including Sequoia Capital were skeptical.
/jlne.ws/2DEq40V

Oil’s Leap Toward $100 Softens the Blow of Russia Sanctions
Aine Quinn – Bloomberg
GAM’s McNamara, Schroders’ Barrineau have been buying bonds; Fitch warns that U.S. sanctions threat isn’t going away soon
When former U.S. President Barack Obama first imposed sanctions on Russia in 2014, a plunge in global crude prices turned the penalties into a crushing blow. This time round, oil markets are doing the opposite.
/jlne.ws/2DEyCom

Financing private investment in China: the role of alternative finance and banking reforms
Noemie Lisack – Bank of England Blog
Small, young private firms in China have long been struggling to obtain formal bank loans. To bypass financial constraints, these firms have resorted to alternative, less formal financing sources. In this context, Chinese authorities are aiming to develop a more formal, market-based, and better regulated credit sector.
/goo.gl/1a3XGJ

The Cities Around the World Most at Risk of Property Bubbles
Paul Panckhurst and Hannah Dormido – Bloomberg
Hong Kong leads the globe, followed by Munich and Toronto; Asian city is also least affordable, while London comes next
Hong Kong is the city most at risk of a property bubble, according to a ranking from UBS Group AG. Munich, Toronto, Vancouver, Amsterdam and London are the next most vulnerable in the bank’s Global Real Estate Bubble Index of 20 major centers for 2018.
/jlne.ws/2DDTj3O

Brexit

Brexit Starting to Loosen London’s Grip on Interest-Rate Swaps; Frankfurt positions itself to win derivatives clearing.
Will Hadfield – Bloomberg
“We are going to need to go for a drink to talk this through, rather than having it out in the open.” What dispute drives regulators to resort to alcohol? The fate of euro clearing after Brexit. The offer from Brian Bussey, the U.S. Commodity Futures Trading Commission official responsible for clearing, was to Jochen Metzger, who does the same job at Germany’s Bundesbank.
/jlne.ws/2DD82fq

Brexit: how likely is a second EU referendum?; The FT looks at whether another vote is possible and how it might come about
James Blitz – FT
As Britain moves into the final phase of the Brexit negotiations, there is growing speculation about whether the UK might hold a second referendum on leaving the EU.
/jlne.ws/2DEpXCg

‘Better Brexit’ plan offered by Boris Johnson, as pressure mounts on Theresa May – Brexit: UK EU Referendum
ABC
Former British foreign secretary Boris Johnson has called on Prime Minister Theresa May to rip up her Brexit proposals by offering what he calls a “better” plan.
/ab.co/2y5tBPR

Hedge funds’ purchase of Brexit vote polling data under scrutiny
The Guardian
Polling companies are facing parliamentary scrutiny over the sale of private polls to hedge funds during the Brexit referendum, which were used to place huge bets on the pound.
Nicky Morgan, a Conservative MP and chair of the powerful Treasury select committee, has written to British Polling Council president, Sir John Curtice, warning that the use of private polling data during election and referendum campaigns could risk the integrity of financial markets.
bit.ly/2xV4qPB

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