SEC Charges Five Russians in $80 Million Hacking and Trading Scheme

Dec 21, 2021

First Read

Hits & Takes
John Lothian & JLN Staff

Trading Technologies International, Inc. (TT) today announced that the company’s acquisition by 7RIDGE is now complete. As planned upon the signing of the transaction on Oct. 31, Keith Todd has assumed the role of CEO.

Katten is holding a webinar titled “ESG Shareholder Proposals — Practical Guidance From Proxy, Legal, IR and Consulting Perspectives” on Thursday, January 6, 2022 from 12 p.m. to 1 p.m. ET co-hosted by Farzad Damania of Katten, Zally Ahmadi of DF King, Ari Frankel of Solebury Trout and George Lu of ADEC. For more information and to register, go HERE.

Allan Schoenberg, former Nasdaq head of corporate communications and now global director of public relations and corporate affairs at Vinson & Elkins, was allowed into the New York Stock Exchange Building when Vinson & Elkins Partner Sarah Morgan was interviewed by NYSE’s Josh King for the Inside the ICE House interview “Vinson & Elkins Partner Sarah Morgan Offers a Lawyer’s View of the Energy Transition.”

Longtime Goldman market analyst Abby Joseph Cohen is retiring at the end of the year, calling it quits to a legendary career.

Bloomberg has a commentary titled “How to Run a Business With Friends Without Killing the Friendship.” I have done this for a long time. Sometimes it works, sometimes it does not work. I will say it is great while it lasts. But, like all relationships, things change, people change and grow at different rates and their needs change.

I had missed this, but Robinhood has acquired Cove Markets, Scott Knudsen’s cross-exchange trading platform for the crypto market.

I really liked the HKEX 2021 year in review they published today. You have to like any article that uses the word “whilst.”

The Omicron surge has become so bad that performances of Hamilton on Broadway have been canceled through Christmas. I guess I am going to lose my shot to see Hamilton this week.

Leo Melamed was interviewed in the What Happens s Next in 6 Minutes podcast.

Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL

*****

The FIA is holding its 2021 Annual ETD Volume Review on January 26, 2022 at 9:30 a.m. ET, with host Will Acworth, senior vp for data publications and research at FIA, and speaker Mike du Plessis, senior managing director, agency execution at TP ICAP. They will discuss trends in trading activity in the global futures and options markets. You can go here to register.~SR

The Depository Trust & Clearing Corporation (DTCC) today provided views on the top issues for 2022 from its senior executives. Among them was Laura Klimpel, general manager of Fixed Income Clearing Corp., who said FICC will continue to lead the conversation around the best market structure for U.S. Treasuries. “The unprecedented volatility in U.S. Treasuries during the pandemic highlighted the importance of making financial services operations more efficient, transparent, and resilient,” Klimpel said. Sounding a theme we also heard at FIA Expo last month, she added, “We have broad industry consensus around the benefits of increased central clearing of U.S. Treasury transactions, which would ultimately reduce risk and improve stability across the industry.”

Also related to market structure, but on the equity side, Michele Hillery, general manager of Equity Clearing and DTC Settlement Service, said DTCC will continue to advance efforts to move the U.S. securities settlement cycle to T+1 in 2022. “This will provide capital efficiencies for firms while reducing systemic and operational for the industry, particularly during periods of market turbulence,” she said.~SC

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Bitcoin’s ‘One Percent’ Controls Lion’s Share of the Cryptocurrency’s Wealth; New research shows that just 0.01% of bitcoin holders controls 27% of the currency in circulation
Paul Vigna – WSJ
It’s good to be the bitcoin 1%. The top bitcoin holders control a greater share of the cryptocurrency than the most affluent American households control in dollars, according to a study by the National Bureau of Economic Research. The study showed that the top 10,000 bitcoin accounts hold 5 million bitcoins, an equivalent of approximately $232 billion. With an estimated 114 million people globally holding the cryptocurrency, according to crypto.com, that means that approximately 0.01% of bitcoin holders control 27% of the 19 million bitcoin in circulation.
/on.wsj.com/3peY5ug

******Concentration risk is an issue.~JJL

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More Than 130 Groups Call on CFTC to Shut Down ‘Dystopian’ Water Futures Market; “In this time of global-warming-induced drought in California, the last thing we need is to gamble on our precious water resources.”
Julia Conley – Commondreams.org
Warning Wall Street against commodifying what has been treated since ancient history as “a common right for everyone,” more than 130 civil society groups on Monday demanded that federal regulators shut down the Chicago Mercantile Exchange’s water futures market.
/bit.ly/3JkoxLh

***** The group has a legitimate issue about the allocation of water entitlements and manipulation that could be explored more, but refers to trading as bets. It is like the last 50 years have not happened.~JJL

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Member Week 2021: Foundation Leader Q&A with Eva Giglio
Council on Foundations
Question: What drew you to the field of philanthropy?
Answer: Having worked for years in Chicago Public Schools for years prior to this role, I worked closely with philanthropists who helped support many key initiatives for the district. I was excited about the opportunity to continue to work in the field of education and hand-in-hand with the school districts, nonprofits, and other philanthropists across the city of Chicago.
/bit.ly/30IivSY

*****CME Foundation’s new leader gets interviewed.~JJL

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Monday’s Top Three
Our most-read story Monday was Don’t Be Surprised When You Get Omicron, from The Atlantic. Second was the press release DV Group to Acquire Business of Allston Trading, which was our No. 1 story Friday. Third was JPMorgan to pay $200m over staff messages on personal devices, from The Financial Times.

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MarketsWiki Stats
26,680 pages; 236,602 edits
MarketsWiki Statistics

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Lead Stories

SEC Charges Five Russians in $80 Million Hacking and Trading Scheme
SEC
The Securities and Exchange Commission today announced fraud charges against five Russian nationals for engaging in a multi-year scheme to profit from stolen corporate earnings announcements obtained by hacking into the systems of two U.S.-based filing agent companies before the announcements were made public. The filing agents assist publicly traded companies with the preparation and filing of periodic reports with the SEC, including quarterly reports containing earnings information.
/bit.ly/3qcCh1D

ICE Transitions Sterling and Euroswiss LIBOR-based Derivatives to SONIA and SARON Ahead of Sterling and Swiss Franc LIBOR Cessation
Intercontinental Exchange, Inc.
Intercontinental Exchange, Inc. (NYSE:ICE), a leading global provider of data, technology, and market infrastructure, today announced that it has transitioned all open interest held in its LIBOR-based Three Month Sterling futures and options and Three Month Euro Swiss Franc (Euroswiss) futures into their risk free rate (RFR) equivalent contracts, Three Month SONIA Index futures and options and Three Month SARON Index futures. The transition took place following the close of business on December 17, 2021.
/bit.ly/33Pgu8P

Republican SEC Commissioner Roisman to Leave Agency; Resignation will give Democrats bigger majority at Wall Street watchdog
Dave Michaels – WSJ
Securities and Exchange Commission member Elad Roisman plans to leave the market regulator by the end of January, giving Democrats a bigger majority at an agency pursuing an ambitious and sometimes politically divisive policy agenda. Mr. Roisman joined the five-member SEC as a Republican commissioner in September 2018, having served as chief counsel for Republicans on the Senate Banking Committee before that. He briefly served as the SEC’s acting chairman at the end of the Trump administration.
/on.wsj.com/3q5pXAk

SEC demands more risk disclosure for Chinese companies listing in US; Issuers asked to provide more information on their use of legal loopholes to list in New York
William Langley and Ryan McMorrow – FT
US regulators are demanding greater disclosure from New York-listed Chinese companies after new rules from Beijing wiped billions of dollars from Chinese education companies and compelled ride-hailing group Didi to delist from American exchanges.
/on.ft.com/3yNTORH

U.S. charges 5 Russian hackers for stealing and front-running earnings announcements from Tesla, Snap and others
Declan Harty
Federal authorities have charged five Russian nationals for allegedly stealing and front-running hundreds of corporate earnings announcements from companies like Tesla, Snap, and others. On Monday, the U.S. Attorney’s Office for the District of Massachusetts and the Securities and Exchange Commission levied both criminal and civil charges against Vladislav Klyushin, Ivan Yermakov, Nikolai Rumiantcev, Mikhail Irzak, and Igor Sladkov for the scheme.
/bit.ly/3Jjff22

JPMorgan’s Paris Traders Are Only Part of the Threat to London; A year after Brexit, the EU’s finance hubs are taking shape. Bloomberg reporters look at the merits of Paris, Frankfurt, Dublin, Amsterdam and Milan.
Bloomberg News
In Paris, JPMorgan Chase & Co. has worked out of an exquisite 18th-century hotel particulier on the Place Vendome for the last 105 years. If you want an idea of how Brexit is transforming the landscape of Europe’s finance industry you should pop around the back. Before Britain quit the European Union, JPMorgan’s Paris HQ was a relative backwater with about 250 staff. Thanks to the shift of EU banking out of London it expects to have 800 by the end of next year. Most remarkable, according to workers there, is that the Wall Street giant has pretty much added a whole new business line to its French HQ: Trading and sales.
/bloom.bg/3pfXrNf

Matthew Comstock, Michael V. Rella Named to Murphy & McGonigle’s Executive Committee
KPVI
Financial services law firm Murphy & McGonigle has elected two new attorneys to the Firm’s Executive Committee. Matthew Comstock, who serves in the Firm’s Washington, D.C., office, is a member of the Firm’s FinTech & Blockchain and Trading & Markets practices and a former SEC Branch Chief. Michael V. Rella, who serves in the Firm’s New York office, is a litigator focusing on complex commercial and securities-related disputes.
/bit.ly/3pfrtAu

Bank Pullback From Commodity Trade Finance Presents Opportunity
Archie Hunter – Bloomberg
Banks pulling back from trade finance after industry blow-ups; Specialist funds offer alternative to financing trading houses
A banking pullback is giving specialist funds the chance to plug part of the widening hole in commodity trade finance. A series of industry blow-ups has seen banks such as ABN Amro Bank NV, BNP Paribas SA and Societe Generale SA cut their role in financing the global trade in natural resources. Those lines of cheap credit are drying up as a surge in commodities from wheat to copper increases the need for loans.
/bloom.bg/3yMnYVk

US regulators propose 5th major change for securities finance transparency this year; Finadium announces client briefing on January 11, 2022
Josh Galper – Finadium
Last week the US Securities and Exchange Commission (SEC) dropped the fifth big US transparency proposal of the year to impact securities finance markets, this one on Total Return Swaps. Join Finadium early next year to make sense of the whole package.
/bit.ly/33HcS8F

Coronavirus

US to send out millions of free Covid tests as Omicron cases surge; Biden will also mobilise armed forces as new variant accounts for three-quarters of cases in the country
Kiran Stacey – FT
The Biden administration is sending out hundreds of millions of Covid-19 tests and mobilising the armed forces to help staff hospitals ahead of what officials expect to be a surge in US infections over the coming weeks.
/on.ft.com/3FhEI9J

WHO director recommends you cancel or postpone holiday events amid COVID-19 surge: ‘Better than a life canceled’
Jake Epstein and Erin Schumaker – Business Insider
The World Health Organization’s director-general recommended on Monday that people cancel or postpone their holiday events as the new Omicron variant drives a spike in COVID-19 cases. “An event canceled is better than a life canceled,” Dr. Tedros Adhanom Ghebreyesus said at a press conference. He added: “It’s better to cancel now and celebrate later, than to celebrate now and grieve later.”
/bit.ly/329C9Iv

We Can’t Go Back to Normal Yet. The NBA Shows Why; Individuals can decide for themselves how cautious to be about Covid. But institutions face special pressures to maintain pandemic restrictions. – Bloomberg
Iceland Tightens Covid Curbs Amid Surge in Cases – Bloomberg
To Fight Omicron, Biden Plans Aid From Military and 500 Million Tests – NY Times
E.U. Will Require Boosters for Vaccine Passes to Remain Valid – NY Times
N.H.L. Is First League to Hit Pause Over Virus Surge – NY Times
SpaceX reports 132 coronavirus cases at its headquarters in Southern California – NY Times
Quebec Closes Schools and Bars With Covid-19 Hospital Cases Up 76% in Two Weeks – Bloomberg

Exchanges, OTC and Clearing

The NYSE’s Record Year for New Listings Focuses Attention on Sustainability; It was another year for the record books at the New York Stock Exchange.
NYSE
During 2021, the NYSE completed a second-straight year of record new listings, including four of the five largest IPOs of the year, increasing the size and breadth of its community of listed companies and adding more than $1 trillion in new market capitalization to the world’s largest stock exchange. This was led by significant listings in technology, biotech and consumer products.
/bit.ly/3e7jFe1

HKEX in 2021: Year in Review
HKEX
Hong Kong Exchanges and Clearing Limited (HKEX) has had a very busy 2021, reporting record nine-month results and trading volumes and further elevating its competitiveness and attractiveness as the region’s premier international financial market. Whilst the ongoing Covid-19 pandemic continued to impact global economies, Hong Kong’s financial markets have remained vibrant, resilient, and robust, with average daily turnover in HKEX’s cash equities market rising 32 percent from a year earlier, and average daily volume of HKEX’s derivatives market recorded a 3 per cent increase.
/bit.ly/3spADg0

BME’s Pre-Market Environment added 9 companies and 5 partners in 2021
BME-X
The energy sector technology company Energy Solar Tech and the advisory firm VGM Advisory join this BME initiative.Parlem Terlecom and Intercity joined BME Growth this year from this BME training programme for Growth SMEs
BME’s Pre-Market Environment (EpM), BME’s programme aimed at helping SME growth companies learn how capital markets work and how to gain access to private and institutional investors, incorporates a new company (Energy Solar Tech) and a new partner (VGM Advisory) today. In total, nine companies and five partners joined this BME initiative in 2021.
/bit.ly/3H1q5HP

MSCI China A 50 Connect and Hong Kong’s growing A-share ecosystem
Wilfred Yiu, Co-Head of Markets, HKEX
On October 18, HKEX launched its highly-anticipated MSCI China A 50 Connect (USD) Index Futures contract – how has it performed? In simple terms, the market has adopted it and the contract has seen a strong response from investors. On launch day, the contract saw the best notional Day 1 turnover of any futures contract launched on our market – and momentum has built from there. Open interest has grown from a notional value of USD 250 million on October 18 and surpassed USD 2 billion on November 19.

Trading in EURO STOXX 50 and DAX futures starts in Brazil
Qontigo
The EURO STOXX 50® Index and DAX® Index, which underlie two of the world’s most heavily traded derivatives, also serve as underlying for futures in Brazil since December 20. B3, operator of the Brazilian stock exchange, has listed the products, which trade in euros but are cleared in Brazilian reais. This is the first time that derivatives on the Eurozone and German flagship benchmarks trade outside of Europe.
/bit.ly/32qV5BW

1 Million Traded On EEX & Nodal
One million environmental contracts have traded year-to-date combined on EEX and Nodal Exchange in 2021.
/bit.ly/3yHOvTY

IBOR reform takes another significant step
Eurex
The Interbank Offered Rate (IBOR) reform has reached one of the last major milestones for the time being. Over two weekends in December and shortly before triggering of the fallback provisions after year end, the Eurex Clearing and other clearing houses have legally converted their legacy transactions referencing to CHF, JPY, and GBP LIBORs to the respective fallback risk-free rates.
/bit.ly/3H0i4CV

Klaveness Combination Carriers lists on Oslo Børs
Euronext
Market capitalisation of approximately NOK 2.49 billion; The 13th transfer YTD at Oslo Børs and the 3rd from Euronext Expand Oslo
Oslo Børs, part of the Euronext Group, today congratulates Klaveness Combination Carriers on its transfer from Euronext Expand to the Oslo Børs main market (ticker: KCC). This is the 13th transfer so far this year, and the third from Euronext Expand.
/bit.ly/33NQtqt

Homizy S.p.A. lists on Euronext Growth Milan
Euronext
40th listing of 2021 on Euronext Growth Milan; Homizy S.p.A. brings the total number of companies listed on Euronext Growth Milan to 171; Total placement volume of the offering equal to EUR10.0 million
Milan – 21 December 2021 – Borsa Italiana, part of the Euronext Group, today congratulates Homizy S.p.A. on its listing on the Professional Segment of Euronext Growth Milan.
/bit.ly/3snqal6

— New Product: Initial Listing of Six (6) Container Freight (FBX) (Baltic) Futures Contracts – Effective February 28, 2022 — CME

Fintech

Sterling Trading Tech Launches Enhanced White Label Offering
Sterling Trading Tech
Sterling Trading Tech (STT), a leader in SaaS based trading technology solutions for equity, futures, and digital assets for the capital markets released enhancements for its white label trading solutions, including the ability to have client branded emails and text alerts created. Sterling offers a white label solution for clients that want to offer a branded experience for their business. The white label build is customized with in-platform branding, unique client specific layouts and configurations, a branded market data entitlements website, and branded account emails. Sterling Trader® Pro, Sterling Trader® Web and Sterling Trader® Mobile are available as the white label offering suite of platforms.
/bit.ly/32lh8di

EEX Press Release – EEX acquires energy analytics firm Lacima Group
EEX
The European Energy Exchange (EEX) has signed an agreement with the shareholders of the energy analytics company Lacima Group to acquire their business. EEX will acquire 100% of Lacima Group. Lacima, headquartered in Sydney, Australia, is a multi-award-winning provider of technology solutions for trading and risk management in the global energy and commodities markets. Lacima’s risk analytics software manages valuation, optimization and risk management. Their trading analytics solution provides tools for pre-trade analyses, structuring and valuation, which further supports trading decisions for their customers.
/bit.ly/3qfn3sK

Jack Dorsey Stirs Uproar by Dismissing Web3 as a Venture Capitalists’ Plaything
Vlad Savov – Bloomberg
Fresh off relinquishing the chief executive reins of Twitter Inc., Bitcoin enthusiast Jack Dorsey has taken to the service he co-founded to voice his displeasure with so-called Web3 technology and the involvement of venture capital firms like Andreessen Horowitz.
/bloom.bg/3EgxQrJ

Robinhood Crypto Welcomes Cove Markets
Robinhood
We’re excited to share that Cove Markets is joining Robinhood. Cove Markets Inc. is a cross-exchange trading platform that makes it easier for people to manage their crypto accounts. As part of the acquisition, co-founders Scott Knudsen and Victor Glava, as well as the Cove Markets team, will join the Robinhood crypto team.
/bit.ly/3snroNe

Cybersecurity

Cybersecurity company identifies months-long attack on US federal commission
Jonathan Greig – ZDNet
The United States Commission on International Religious Freedom (USCIRF) has been hit with a cyberattack, according to cybersecurity firm Avast.
Avast did not identify the federal agency affected, but The Record was able to determine it was the USCIRF.
/zd.net/32nhNez

How The Great Resignation Could Benefit Cybersecurity
Renee Tarun – Forbes
It’s not surprising that living through a major historical event like a global pandemic has caused people to take stock of their lives. For some, spending more time with family caused them to realize how much they had been missing. Others found the idea of returning to a toxic workplace or an unfulfilling job too awful to contemplate. For countless reasons, many people are leaving their jobs — so many, in fact, that the exodus has been dubbed the “Great Resignation.”
/bit.ly/3yMStL0

14 cybersecurity predictions for 2022 and beyond
MIT Technology Review
While the covid-19 pandemic upended workplaces and ushered in rapid digital transformation, the turmoil around cybercrime has remained constant: attackers are always changing tactics to evade detection. Flexible, customer-first solutions have emerged to meet ever-changing circumstances to keep organizations secure and confident against cyber threats. In the new year and beyond, as technology and workplace trends evolve and laws and regulations change, cybersecurity forecasts are emerging.
/bit.ly/3FkdW06

Cybersecurity budgets surge, as skills gap wreaks havoc on 2022 plans
Help Net Security
According to the latest survey from the Neustar International Security Council (NISC), conducted in November 2021, 81% of organizations have committed to bolstering their cybersecurity budgets for 2022. 24% of respondents are increasing allocations between as much as 31% to 50% over this past year, while 41% are raising budgets 11% to 30%.
/bit.ly/3eaoxyU

6 top cybersecurity trends from 2021 and their impact on 2022
Camille Morhardt – Help Net Security
2021 has been a wild year in the cybersecurity space. From supply chain attacks like the SolarWinds hack to the NSO Group’s spyware scandal to the Colonial Pipeline ransomware attack, organizations are facing new (and repackaged) attacks daily. In fact, according to the Identify Theft Resource Center, the total number of data breaches through September 2021 has already exceeded 2020 numbers by 17%.
/bit.ly/3eazlwX

Russian Hacker Extradited to US for Trading on Stolen Information
Ionut Arghire – Security Week
A Russian national was extradited to the United States from Switzerland over the weekend, to face charges for his alleged role in a scheme whose participants traded on information stolen from hacked U.S. companies. The man, Vladislav Klyushin, 41, of Moscow, Russia, was arrested in Switzerland on March 21, 2021. Also known as Vladislav Kliushin, he was charged alongside four other Russians allegedly involved in the same scheme.
/bit.ly/3qdLO8I

Cryptocurrencies

TP ICAP Digital Assets Platform Adds Jane Street And Virtu Financial As Liquidity Providers
TPICAP
TP ICAP, a leading global markets infrastructure and data solutions provider, is pleased to announce that leading liquidity providers Jane Street and Virtu Financial have committed to supporting the upcoming launch of the TP ICAP Digital Assets Spot Platform. The addition of the market makers will help provide the platform with the tight pricing that clients expect and from brands they recognize and trust.
/bit.ly/32ie01V

Crypto Funds Explode in Boom Year Marked by First U.S. Bitcoin ETF; The debut of a ProShares fund tracking Bitcoin futures galvanized the market in 2021, but there were plenty of other superlatives to go around.
Katherine Greifeld – Bloomberg
Even beyond the launch of the first U.S. Bitcoin futures ETF, cryptocurrency funds notched some notable global milestones in 2021. The number of crypto-tracking investment vehicles worldwide more than doubled to 80 from just 35 at the end of 2020, according to Bloomberg Intelligence data. Assets soared to $63 billion, compared to $24 billion at the start of the year.
/bloom.bg/3eauOur

Melania Trump is flogging fungible NFTs; BUY NOW WHILE LIMITLESS SUPPLY LASTS.
Jemima Kelly – FT
‘Tis truly the season of giving. Not content at repeatedly giving her husband the best face anyone ever has, former first lady Melania Trump is giving again: That’s right. Generous billionaire’s wife Melania is giving an (unspecified) portion of the proceeds from the sale of her “new NFT endeavor” to assisting “children in the foster care community”. Who said philanthropy was dead?
/on.ft.com/3eaYAPR

Regulation

Effective date for amendment to exclude certain associated persons from the Branch Office Manager Examination requirement
NFA
NFA Compliance Rule 2-7 generally prohibits a Member from permitting an associated person (AP) to act as a branch office manager unless the individual has taken and passed NFA’s Branch Office Manager Examination (Series 30). NFA recently amended NFA Compliance Rule 2-7 to exclude from the Series 30 requirement any swap AP acting as a branch office manager for a Member engaged solely in swap activities. NFA adopted this amendment because Swap APs are also required to pass NFA’s Swaps Proficiency Requirements, which include a section on supervision and are directly related to a Member’s swap activities. Passing the Series 30, which in addition to supervision covers topics not directly applicable to a branch office solely engaged in swaps, is no longer necessary for these APs.
/bit.ly/3Ebi4hT

Nikola to Pay $125 Million SEC Penalty Over Milton Comments
Matt Robinson – Bloomberg
Founder misled investors on business prospects, regulators say; Nikola didn’t admit or deny wrongdoing in settling the claims
Nikola Corp. will pay a $125 million penalty to the U.S. Securities and Exchange Commission over allegedly misleading statements its founder and former chief executive officer made to investors about the electric-vehicle startup.
/bloom.bg/3pfEA4Q

SEC charges Chicago oncologist with insider trading
Reuters
US authorities have charged a Chicago doctor with insider trading, accusing him of using nonpublic information about drug trial results to reap illicit profits from buying shares of a California-based biotechnology company. The Securities and Exchange Commission (SEC) and federal prosecutors in Illinois said in statements on Monday they have charged a gastrointestinal medical oncologist, Daniel V.T. Catenacci, related to trading in securities of Five Prime Therapeutics.
/bit.ly/3H3cwYo

SEC Charges Clinical Drug Trial Investigator with Insider Trading
SEC
The Securities and Exchange Commission today announced charges against Daniel V.T. Catenacci for insider trading in the securities of biotechnology company Five Prime Therapeutics, Inc. in advance of the company’s November 10, 2020 announcement that it had achieved positive drug trial results for its flagship cancer drug Bemarituzumab.
/bit.ly/3qi9GrF

SEC Charges Private Equity Fund Adviser with Fee and Expense Disclosure Failures
SEC
The Securities and Exchange Commission today charged registered investment adviser Global Infrastructure Management, LLC for failing to properly offset management fees and for making misleading statements about the fees and expenses it charged. Global agreed to pay a $4.5 million penalty to settle the SEC charges and voluntarily has repaid $5.4 million to its affected private fund clients.
/bit.ly/3mnD2nx

Statement of Commissioner Elad L. Roisman
Commissioner Elad L. Roisman – SEC
Today, I sent a letter to President Biden, informing him that I intend to resign my position by the end of January. Serving the American people as a Commissioner and an Acting Chairman of this agency has been the greatest privilege of my professional life. It has been the utmost honor to work alongside my extraordinary SEC colleagues, who care deeply about investors and our markets. Over the next several weeks, I remain committed to working with my fellow Commissioners and the SEC’s incredible staff to further our mission of protecting investors, maintaining fair, orderly, and efficient markets, and facilitating capital formation.
/bit.ly/3mndGGv

Statement on Commissioner Roisman’s Departure
Chair Gary Gensler – SEC
Today, my colleague and fellow Commissioner Elad Roisman announced his intentions to step away from the agency in January. I’d like to thank Commissioner Roisman for his dedicated service to the Commission and to the American public, both as a Commissioner and as Acting Chairman. While we didn’t always agree on policy matters, I’ve come to rely on his judgment and expertise, and I have enjoyed a positive working relationship with him.
/bit.ly/3mnEplY

10% depreciation notifications: further extension of temporary measures for firms
UK FCA
Since March 2020 we have adopted temporary measures on the requirement for firms to issue 10% depreciation notifications to investors (COBS 16A.4.3 UK).
/bit.ly/33HkuIl

JFSA’s initiatives in AML/CFT/CPF in response to FATF Fourth Round Mutual Evaluation Report (MER)
Japan FSA
The Financial Action Task Force (FATF) published the Fourth Round Mutual Evaluation Report (MER) of Japan on 30 August, 2021.
/bit.ly/3mnEfv5

Investing and Trading

Five Big Tech Stocks Are Driving Markets. That Worries Some Investors; Narrowing market breadth can herald declines in stocks, analysts say
Michael Wursthorn – WSJ
The stock market’s rise this year has narrowed around a short list of big tech companies, a sign of possible weakness heading into 2022. Five of the biggest stocks in the S&P 500 account for more than half of the broad benchmark’s gain since April, analysts at Goldman Sachs found. Of the S&P 500’s 22% advance this year, those stocks— Microsoft Corp. MSFT -1.20% , Nvidia Corp. NVDA -0.29% , Apple Inc., AAPL -0.81% Alphabet Inc. GOOG -0.28% and Tesla Inc. TSLA -3.50% —are responsible for around a third.
/on.wsj.com/30LwWFS

Environmental, Social and Corporate Governance

The Power Crunch Just Made Renewables Stronger; Fundamental cost benefits, more than the earnest promises of executives, ultimately will drive the energy transition.
David Fickling – Bloomberg
A few months ago, it looked like a cascading global power crunch was about to turn back the tide of the energy transition. In China, shortages of coal drove prices of solid fuel to 1,908.20 yuan per metric ton ($299.29), leading to power cuts and industrial shutdowns as generators refused to sell fixed-tariff power at a loss. In Europe, the great sucking sound as coal-starved Asian grids vacuumed up liquefied natural gas combined with weak supplies from Russia and the Netherlands to send gas prices soaring. They’ve now hit 146.93 euros ($165.74) per megawatt hour, more than six times their level at the start of the year.
/bloom.bg/3Ejgf2l

A Quant Investor Uses A.I. to Track Down Corporate Greenwashing; By analyzing how executives talk about their sustainability efforts, Acadian’s Andy Moniz hopes to figure out who’s full of hot air.
Liam Vaughan – Bloomberg
As sustainable investing becomes more mainstream on Wall Street, companies are doing everything they can to present themselves as eco-friendly and ethically run. But the environmental, social, and governance (ESG) ratings that money managers rely on don’t always do a good job of cutting out the greenwashers—businesses that talk a good game but don’t match it with action.
/bloom.bg/32hTrCN

Institutions

Goldman’s Abby Joseph Cohen, Known for Bullish Stock-Market Calls, to Retire
Daniel Taub – Bloomberg
Cohen, 69, had handed off most of management duties in 2017; She’s ‘been an influential presence at the firm,’ Hatzius says
Abby Joseph Cohen, the Goldman Sachs Group Inc. senior investment strategist whose upbeat stock-market forecasts made her one of the faces of the 1990s bull market, will retire at the end of the year.
/bloom.bg/3sti2j1

BNP’s $16 Billion Windfall Boosts Bank’s European Deal Hunt
French lender has said it will pursue bolt-on acquisitions; Possible targets could include custody or insurance business
Jan-Herik Foerster – Bloomberg
BNP Paribas SA’s sale of its U.S. operations to Bank of Montreal won’t just reshape North American finance. It could also shake up Europe’s banking landscape. The $16.3 billion deal — if approved — will provide BNP Paribas with a war chest to pursue an acquisition in Europe. The French lender has said it will use the proceeds for buybacks and bolt-on acquisitions, prompting speculation about who it might target.
/bloom.bg/3FkXPQ1

Deutsche Bank fired senior manager over explicit messages and photos; Dismissal came after female trainee made allegations against two male colleagues
Olaf Storbeck – FT
A female Deutsche Bank trainee accused a male colleague of sexual assault and another of sexual harassment, triggering an investigation that led to the dismissal of one of the men. Germany’s largest lender alerted criminal prosecutors to the allegations soon after they were made in February 2021. The bank’s own probe did not substantiate the most serious allegations but found that both men had exchanged inappropriate text messages and photos with the woman.
/on.ft.com/3pgwUiF

Schroders buys 75% stake in renewable energy specialist Greencoat for £358m; Deal reflects greater demand for sustainable assets and expansion of private capital sector
Harriet Agnew and Oliver Ralph – FT
London-based fund manager Schroders has confirmed the £358m acquisition of a 75 per cent stake in Greencoat Capital, one of Europe’s largest renewable infrastructure managers. The move marks the latest example of dealmaking in the asset management industry and will help Schroders take advantage of two of the sector’s biggest trends — greater demand for renewable energy assets and the expansion of the private capital sector.
/on.ft.com/3pdHuXS

Regions

Turkish Stocks Extend Slide as Circuit Breakers Trigger Halt
Tugce Ozsoy – Bloomberg
Turkish stocks extended their losses following Friday’s rout, prompting two automatic trading halts as local investors rushed out of the market after the lira’s slide to a record low exacerbated economic concerns.
/yhoo.it/3GTHeDg

Ray Dalio’s China Fascination Predates His Ties to Beijing’s Billions
Katherine Burton – Bloomberg
The visitors from China arrived in affluent Westport, Connecticut, on a singular mission: to learn the ways of Bridgewater Associates, the world’s largest hedge fund.
/yhoo.it/3GXikTl

How Erdogan’s Plan to Halt the Lira’s Fall Is Meant to Work
Asli Kandemir – Bloomberg
Turkey’s President Recep Tayyip Erdogan unveiled an emergency plan to curb the lira’s unprecedented depreciation and protect investors against wild swings in the currency. One measure guarantees that returns on lira-denominated deposits wouldn’t fall short of bank interest rates, in an effort to end current spot demand for foreign exchange.
/bloom.bg/3Eiz5qq

Fidelity brings second active ETF to market in Australia; Manager launched its first active ETF in the country three years ago
Sandra Heistruvers – FT
Fidelity International has rolled out a second active exchange traded fund in Australia in response to increasing local investor demand for active ETFs. The $706bn asset manager originally launched its global demographics strategy as a managed fund back in 2012. The ETF version of the fund has now been listed on Australia’s stock exchange under the ticker FDEM.
/on.ft.com/3Fkmap5

Miscellaneous

How to Run a Business With Friends Without Killing the Friendship; Work with people you want to hang out with and speak up if you’re unhappy.
Lindsey Tramuta – Bloomberg
Going into business with friends is a lot like going into business with a romantic partner: The pairing can either bring you closer together or ruin the relationship. That risk didn’t deter childhood chums Marianne Fabre-Lanvin and Thomas Delaude, wine industry professionals who this year launched Souleil Vin de Bonté, a trio of organic house wines. In fact, the idea of working together was at the very core of the brand, and they brought on other friends to develop the line’s visual identity and philanthropic mission. Co-founder Marianne Fabre-Lanvin shares her top four tips for doing business with friends—without losing the friendships.
/bloom.bg/3Egz46c

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The Spread

Hedges Across Assets Are Too Expensive, Morgan Stanley Says

Lead Stories Hedges Across Assets Are Too Expensive, Morgan Stanley Says Options imply broad range of outcomes, strategists say Morgan Stanley suggests positioning for a peak in volatility Joanna Ossinger - Bloomberg Long volatility is too expensive as hedging...

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