The Mystery Millionaire Who Haunted London’s Insider-Trading Trial

Jul 3, 2019

First Read

Hits & Takes
JLN Staff

CME Group’s Julie Holzrichter and Julie Winkler, OCC’s Amy Shelly and CMT Digital Holdings’s Founder and CEO Colleen Sullivan are among the women listed in Crain’s Chicago’s Notable Women in Finance.~JJL

CNN reports “Last month broke the record for the hottest June ever in Europe and around the world.~JJL

Hazem Dawani, winner of a Tech-X Emerging Leader Award from his alma mater, the Illinois Institute of Technology (IIT), has written an essay on “IIT and the Future of FinTech,~JJL

Colin Ashburn, the son of Doug and Nancy Ashburn and a former JLN intern, marched in the Pride Parade in Chicago with his new employer and wore his MarketsWiki Education drawstring backpack. Way to go Colin and thanks for the advertising!~JJL

JP Morgan Chase’s Jamie Dimon in an interview with Yahoo Finance said: ‘Regulation, bureaucracy, and stupidity’ are what’s wrong with America.~JJL

More disciplinary notices – first up, ICE. Craig Cowell – while neither admitting nor denying the allegations – agreed to a permanent suspension from all ICE platforms for spoofing related infractions in coffee, sugar, and cocoa futures. ~SD

Refco’s Tom Dittmer has written a book, “Talkin’ Big: How an Iowa Farm Boy Beat the Odds to Found and Lead One of the World’s Largest Brokerage Firms.” Read it at your own risk and only if you have at least a 3rd grade level reading level. I really did not need to know how Dittmer lost his virginity.~JJL

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Time runs out on Swiss equivalence
Anne Plested – Fidessa/ION
Despite Swiss beliefs that all the conditions are still met for recognition by the EU, there was no let-up in the EU’s resolve to see this privilege revoked. The financial community’s hopes last week of an eleventh-hour extension to maintain the status quo were dashed. Nothing was granted nor promised.
/jlne.ws/32aJT8j

***** Anne Plested is the new Steve Grob.~JJL

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Simta Gupta Joins ADMIS as VP, Operations
ADM Investor Services, Inc. (ADMIS) has named Simta Gupta as its vice president, Operations. She will be responsible for the oversight, direction and coordination of ADMIS’ operations and processing teams.
/jlne.ws/2Nrk68r

*****Missed this one from ADMIS on Monday.

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Why Ken Griffin and Citadel Staying in Chicago Is a Win For Chicago Tech
Jeremie Bacon – Chicago Inno
Back in May, nearly 2,000 miles away, Citadel CEO Ken Griffin made a small comment that has big ramifications for Chicago. Speaking at the Milken Institute Global Conference in Beverly Hills, California, Illinois’ richest man affirmed his commitment to stay in Chicago. While noting the city’s problems with the “three Cs” of corruption, cronyism and crime, Griffin stated that rather than move his family and company, he planned to “stand and fight for the policies and changes that will make this state better.”
/jlne.ws/2J6qb5W

***** Stay or run? Staying is better.~JJL

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Roubini Wants the World to See His Latest Tirade Against Crypto
Samson Ellis – Bloomberg
‘Dr. Doom’ argued the merits of crypto with head of exchange; BitMEX controls rights to footage of the heated discussion
New York University professor and outspoken blockchain critic Nouriel Roubini unleashed another fiery tirade against cryptocurrencies in front of hundreds of crypto enthusiasts Wednesday — and he wants everyone to know it.
/jlne.ws/3262P83

***** Nouriel Roubini gets up every morning and rails about cryptocurrencies even before he brushes his teeth, though sometimes it is just a muttering.~JJL

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The British Banking Dynasty That’s Even Older Than the Rothschilds; C. Hoare & Co. has been in business for more than three hundred years, and the family that founded it is still running the show.
Tom Metcalf – Bloomberg
In the U.K. there’s old money, really old money and then there’s C. Hoare & Co. The London firm was started in 1672 by Richard Hoare and has tended to the affairs of diarist Samuel Pepys, poet Lord Byron and novelist Jane Austen. That’s almost a hundred years older than the famous Rothschild dynasty, which was founded in the 1760s. After more than three centuries of continuous operation, the family still runs the show, overseeing about 4.4 billion pounds ($5.6 billion) of deposits and sticking to a traditional way of doing business.
/jlne.ws/328v5ab

***** Byron’s bank is something.~JJL

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Tuesday’s Top Three
Our top story of the day on Tuesday was Vanity Fair’s Hedge Fund Manager Chip Skowron on Life After Prison. Second was Bloomberg’s Empty Desks and Early Beers: Life at Deutsche Bank in New York. Third was the Nasdaq release Nasdaq Announces the Board of Directors of its U.S. Exchanges. Among the notable names were longtime exchange executive Tom Kloet and Tom Wittman, who just announced his retirement from Nasdaq’s exchanges.

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Lead Stories

The Mystery Millionaire Who Haunted London’s Insider-Trading Trial; Alshair Fiyaz, who owns a polo club and a superyacht, led police to trader Walid Choucair. Now Choucair is in prison while Fiyaz hasn’t been charged.
Franz Wild, Aaron Kirchfeld, Gaspard Debag – Bloomberg
When Alshair Fiyaz, a wealthy businessman with a shaggy mane of hair, walked into the garden of London’s Four Seasons Hotel on a pleasant June evening five years ago, he had no idea he was being followed. He was there to meet Walid Choucair, a trader wearing a hoodie who collected “Star Wars” memorabilia and expensive guitars. Neither one noticed an officer from the National Crime Agency stick a recording device in the greenery.
/jlne.ws/32h9PPA

UK regulator proposes ban on crypto-based derivatives; Financial Conduct Authority said assets such as bitcoin had ‘no reliable basis for valuation’
Cat Rutter Pooley and Martin Coulter – FT
The UK financial watchdog has proposed a ban on the sale of crypto-based derivatives amid a resurgence in the price of bitcoin, the most high-profile cryptocurrency.
/jlne.ws/3242x1z

**** Here is the Reuters version of this story.~JJL

**** Here is the [[https://jlne.ws/2NuyuwG|UK FCA announcement]].~[[JJL]]

Deutsche Bank Looks to Shed Big Chunk of Wall Street Presence; The troubled German lender has held talks with Citigroup, BNP Paribas and others that could involve sale or transfer of trading technology and pieces of prime-brokerage business
Jenny Strasburg and Telis Demos – WSJ
Deutsche Bank AG is taking steps to dismantle a pillar of its Wall Street investment bank. The troubled German lender has had discussions with Citigroup Inc., BNP Paribas SA and others that could lead to a sale or transfer of parts of its once-prized equities business, including operations that serve hedge funds and other big trading customers, according to people familiar with the matter.
/jlne.ws/323bmsd

Derivatives Vigilantes Are Punishing the Badly Behaved Nations; Countries that score poorly on ESG criteria pay more to borrow. Time for central banks to step up.
Mark Gilbert – Bloomberg
Asset managers are increasingly using their financial clout to persuade companies to be friendlier to the planet, wielding a combination of the stick of disinvestment and the carrot of engagement. But can the financial world do more to ensure countries and their central banks are also meeting their environmental, social and governance responsibilities?
/jlne.ws/31ZmxlI

FCA regulator warns cryptocurrency groups to ‘get it right’
Caroline Binham – FT
The UK’s financial markets watchdog has warned Facebook and other issuers of digital currencies against the tech giant’s traditional motto of “move fast and break things”, putting them on notice that providers of financial services must “get it right the first time round.”
/jlne.ws/326tSQB

Facebook’s Libra cryptocurrency needs deep thought and detail: UK regulator
Tom Wilson – Reuters
Facebook’s fledgling cryptocurrency will raise questions for both society and government that need close examination, a senior official at Britain’s financial watchdog said on Tuesday, in another sign that the planned project will face deep scrutiny.
/jlne.ws/2NvhnLe

Bitcoin’s Wild June Is a ‘Slam Dunk’ Against Crypto ETF Approval
Olga Kharif – Bloomberg
The U.S. regulator has so far refused to allow funds to list; ‘Unnatural volatility’ boosts that stance, says Arca’s Dorman
Crypto enthusiasts weren’t the only ones watching Bitcoin’s meteoric ascent last month. The likelihood of a Bitcoin exchange-traded fund gaining approval from the U.S. regulator has declined thanks to the cryptocurrency’s wild price swings in June, Jeff Dorman, chief investment officer at Arca, wrote in a July 1 research note.
/jlne.ws/325BAKJ

It is wrong to equate patient capital with illiquidity; Guide from Pensions and Lifetime Savings Association contains questionable assertions
Stuart Dunbar – FT
A guide to patient capital, published in the spring by the Pensions and Lifetime Savings Association and part of its “Made Simple” series, is a prime example of woolly thinking. It is depressing to see this from a UK industry body that should take the wider view.
/jlne.ws/32942v6

Passing knowledge to the next generation of investors; I’ve polished my strategy through my daughters’ portfolio
John Lee – FT
I started share portfolios for our two daughters in 1981, when they were aged 5 and 3, following a modest payout from the dissolution of a family trust. I invested £700 for each of them in English China Clays, Rowton Hotels and Friedland Doggart. Thankfully, all delivered profits over time.
/jlne.ws/326f4RP

International Precious Metals Institute names new president; Oliver Krestin, a managing director of Hensel Recycling, to lead the association.
DeAnne Toto – Recycling Today
During the 43rd conference of the International Precious Metals Institute (IPMI), Pensacola, Florida, Oliver Krestin, one of Hensel Recycling’s managing directors, was appointed to the post of president of the association. The conference was June 15-18 in Reno, Nevada.
/jlne.ws/32h5vzQ

The Anatomy Of A Fake Cryptocurrency Trade: How Exchanges Create Phony Transactions
Jeff Kauflin – Forbes
Take a close look at trading activity on BKEX—a cryptocurrency exchange founded in 2018 and registered in the British Virgin Islands—and you’ll see something odd. Compare its transactions side-by-side with those of Binance, one of the largest crypto exchanges in the world, and you’ll notice BKEX’s trading history is a replica, printing the same numbers delayed by a few seconds
/jlne.ws/323Muka

A Lagarde-Run ECB Might Mean a Very Different Kind of Presidency
Craig Stirling and Zoe Schneeweiss – Bloomberg
IMF chief will be first politician to take charge of ECB; Role might draw more on salesmanship than policy creativity
Christine Lagarde’s accession to the helm of the European Central Bank for the era after Mario Draghi might augur a very different style of leadership.
/jlne.ws/323Twp2

Exchanges, OTC and Clearing

Intercontinental Exchange Reports June Statistics
ICE
Intercontinental Exchange, Inc. (NYSE:ICE), a leading operator of global exchanges and clearing houses and provider of data and listings services, today reported June trading volume and related revenue statistics, which can be viewed on the company’s investor relations website at http://ir.theice.com/ir-resources/supplemental-information in the Monthly Statistics Tracking spreadsheet.
/jlne.ws/2NxHely

Nasdaq Welcomed 97 IPOs and Seven Exchange Transfers in the First Six Months of 2019
By GlobeNewswire
Nasdaq (Nasdaq:NDAQ) announced today that in the first half of 2019 it welcomed 97 initial public offerings (IPOs), raising a total of $17.7 billion. With an 80% win rate in the U.S. market, Nasdaq has extended its leadership to 22 consecutive quarters. In addition to the IPOs, seven companies switched from the NYSE to join Nasdaq, including global healthcare leader Sanofi.
/jlne.ws/2Nvzelh

EEX Group to launch clearing services for Japanese Power Derivatives in 2020
EEX
EEX Group is planning to extend its Power Derivatives offering in the first half of 2020 by launching Trade Registration services for Japanese Power Derivatives. Following meetings in Tokyo this week, the Ministry of Economy, Trade and Industry (METI) in Japan have confirmed EEX Group’s plans to launch clearing services for financially-settled Japanese power derivatives is allowed under the Japanese Commodities Derivatives Act. The new product offering, which is subject to standard European regulatory approval, will be the first Asian market area on the EEX Power Derivatives platform, which currently comprises 20 market areas in Europe.
/jlne.ws/2JpDXPR

CME is switching to a VAR-based margin model for energy in H1 2020; Ice will start with rate futures
Costas Mourselas – Risk.net
Ice Clear Europe is set to roll out its new value-at-risk (VAR)-based margin methodology for listed derivatives clearing in early 2020 – a move that puts it on a potential collision course with CME Group, which is plotting the launch of its own revised VAR-based method during the first half of next year. Both timelines are provisional, and subject to regulatory approval.
/jlne.ws/329HbQ7

Rising crop prices and USDA payment announcements lift farmer sentiment, despite uncertain economic environment
CME Group
Ag producer sentiment rebounded in June as farmers’ expressed a more optimistic outlook towards the future of the ag economy. The Purdue University/CME Group Ag Economy Barometer, based on a mid-month survey of 400 agricultural producers across the U.S., increased to a reading of 126 in June, up 25 points from May.
/jlne.ws/327NljK

Quadruple witching triggers $1.5bn VM call at CME Clearing
Alessandro Aimone – Risk.net
CME Clearing’s futures and options clearing service issued a variation margin payment call of $1.5 billion to one member in the first quarter of the year – the largest made by the central counterparty (CCP) since Q2 2018.
/jlne.ws/3262eTR

Kazpost JSC and Renaissance Capital have become trading members of AIX
AiX
Expanding access for a large base of retail investors across many regions of Kazakhstan through Kazpost, and by institutions in the region through one of the leading independent investment companies in the frontier and emerging markets
/jlne.ws/327Fcfm

Eurex June figures: Eurex Exchange falls slightly, EEX and Eurex Repo on an upward trend
Eurex
Eurex, Europe’s largest derivatives exchange and part of Deutsche Börse Group, saw an increase of 12 percent in the number of traded contracts in European equity derivatives (41m compared to 36.5m in June 2018). Across all Eurex markets there was a slight reduction of 7 percent in the number of traded contracts (185.4m compared to 199.8m in June 2018).
/jlne.ws/2J5Vn5g

Video: Changing clearing market structure
Eurex
Over the last couple of years, Eurex Clearing worked on evolving today’s clearing market structure to make clearing more efficient and the overall market more resilient. As any change to market structure, this takes time – and now we see more and more results. In our video, Eurex Clearing board member Matthias Graulich walks us through the recent developments.
/jlne.ws/323EUpA

Semi-annual report: Xetra-Gold reaches new record in gold holdings and assets under custody
Growth of about 13 tonnes year-on-year / Europe’s largest physical-backed gold security
Deutsche Börse Commodities
The gold holdings of the Xetra-Gold exchange-traded bearer bond (ISIN: DE000A0S9GB0 ) rose to a new record of 194.3 tonnes on 30 June. That’s an increase of around 13 tons over the course of the year. At the turn of the year, 181.5 tons of gold were still stored in the central safe deposit for German securities in Frankfurt. Xetra-Gold is Europe’s leading physically backed gold security.
/jlne.ws/31ZZWFP

Fintech

Northern Trust Hands Off Blockchain Solution to Fintech Firm
Max Boddy – Cointelegraph
Northern Trust has handed over its blockchain platform to fintech firm Broadridge Financial Solutions, according to a press release on June 26.
/jlne.ws/32aLdbh

Tradeweb Introduces Price Streams And iDeal Messaging Tool For Bond Connect Investors
Tradeweb
Tradeweb Markets Inc. (Nasdaq: TW), a leading global operator of electronic marketplaces for rates, credit, equities and money markets, has introduced a series of new features further optimising offshore investors’ access to the Chinese Interbank Bond Market (CIBM). The launch of dealer streaming prices and iDeal – the messaging tool developed by the China Foreign Exchange Trade System (CFETS) – on Tradeweb was announced during the Bond Connect Anniversary Summit in Hong Kong today.
/jlne.ws/325B7Im

Why dealing with fintechs is a bit like dealing with pirates
Izabella Kaminska
Over a week ago the Bank for International Settlements (BIS) published a special chapter in its annual economic report on the opportunities and risks of big tech setting off into the high seas of finance.
/jlne.ws/32aKJ4X

Upgrade path for Bloomberg SSEOMS clients; Following Bloomberg’s recent announcement that the firm will discontinue its SSEOMS product, clients need to consider other options, selecting Itiviti’s multi-asset Order Management System (OMS)
Itiviti
On May 8 Itiviti announced that its multi-asset Order Management System (OMS) has been selected by several customers who were currently using Sell-Side Execution and Order Management Solutions (SSEOMS) from Bloomberg L.P. Following Bloomberg’s recent announcement that the firm will discontinue its SSEOMS product, clients need to consider other options.
/jlne.ws/325z2My

Fintech Funding Circle shows valuations are a binary choice; Warning exposes the persistent bugs in the peer-to-peer lending program
Matthew Vincent – FT
UK fintech companies — like the computer codes they rely on — are essentially binary. They exist in one of two states: pre-fundraising, or post-fundraising. And, in each, they appear to give out different signals.
/jlne.ws/2NqvvFo

Cryptocurrencies

U.K. Finance Watchdog Proposes Retail Crypto Derivatives Ban
Alastair Marsh and Donal Griffin – Bloomberg
The U.K.’s financial services regulator is proposing a ban on retail sales of derivatives tied to some crypto assets, as it seeks to clamp down on risky financial products.
/jlne.ws/327QTT6

UK Regulators Approve First Cryptocurrency Hedge Fund
Daniel Kuhn – Bloomberg
Prime Factor Capital was the first crypto hedge fund approved as a full-scope alternative investment fund manager by the Financial Conduct Authority, according to Bloomberg.
/jlne.ws/2YuYwAW

Citing ‘massive risks,’ House Democrats ask Facebook to halt its cryptocurrency plans
Mike Murphy – MarketWatch
“If products and services like these are left improperly regulated and without sufficient oversight, they could pose systemic risks that endanger U.S. and global financial stability.” That’s what a group of Democrats on the House Financial Services Committee said to Facebook Inc. on Tuesday, in a letter asking the tech giant to halt plans for Libra, its cryptocurrency project.
/jlne.ws/2LtcwaK

UK Regulators Approve First Cryptocurrency Hedge Fund
Daniel Kuhn – Coindesk
Prime Factor Capital was the first crypto hedge fund approved as a full-scope alternative investment fund manager by the Financial Conduct Authority, according to Bloomberg. Though approved by the UK watchdog, the firm will abide by European regulations.
/jlne.ws/2YuYwAW

British Regulator FCA Prepares a Potential Ban of Crypto CFDs for Retail Investors
Helen Partz – Cointelegraph
British financial watchdog, the Financial Conduct Authority (FCA), is preparing a potential ban on the sale of crypto derivatives to retail investors, according to an official document released on July 1.
/jlne.ws/2NtPB1s

Sanctions-Hit Cuba Eyes Cryptocurrency as Solution to Financial Woes
Daniel Palmer – Coindesk
Cuba has announced it is considering the use of cryptocurrency in order to bolster its finances. According to a report from SBS-AAP, the country’s Communist government announced on state-run TV that it would potentially use crypto as part of a package aimed to boost incomes for as much as a quarter of Cubans and assist with market reforms. The move is possibly influenced by the nation’s ally, Venezuela, which launched its own “petro” cryptocurrency early last year. It’s not clear from the report if Cuba might launch its own token or use existing alternatives.
/jlne.ws/2S0d4WZ

*****Yeah, totally. It worked for Venezuela.~MR

FCA proposes ban on cryptocurrency products
Rob Davies – The Guardian
The UK’s markets regulator has proposed a ban on financial instruments linked to digital cryptocurrencies such as bitcoin, warning that such products could cause huge losses for retail consumers unlikely to understand their risks or value. The Financial Conduct Authority (FCA) said products such as derivatives and exchange-traded notes (ETNs) that reference crypto-assets were “ill-suited” to small investors.
/jlne.ws/2XP8boG

Bank of Japan to keep a close eye on Libra
The Block
The Bank of Japan (BOJ) is expressing reservations about Facebook’s cryptocurrency project, Libra. An anonymous BOJ official told the Nikkei Asian Review that because financial institutions need to cover the expenses that comes with regulation, Libra will be “be piggybacking for free on a financial system that takes heavy costs.” The BOJ Governor Haruhiko Kuroda added he would “keep careful watch” on the project.
/jlne.ws/2Nup8Bb

Bitcoin Rally Fuels Market in Crypto Derivatives; New structured products draw concern as digital currency climbs back above $10,000
Alexander Osipovich – WSJ
Wall Street has dreamed up an array of derivatives tied to stocks, commodities and mortgages. Now such contracts are being developed for bitcoin.
/jlne.ws/329MfnU

‘Bitcoin Time’ Moving Faster Than ‘Internet Time,’ Says Hashcash Inventor Adam Back
Marie Huillet – Cointelegraph
Blockstream CEO Adam Back — inventor of the hashcash proof-of-work (PoW) system later used in bitcoin’s (BTC) mining algorithm — says that “bitcoin time” seems to be running faster than the so-dubbed “internet time” of the early dotcom era.
/jlne.ws/326hakF

JPMorgan Chase CEO: Crypto Projects Pose No Threat to Banking System
Ana Alexandre – Cointelegraph
JPMorgan Chase CEO Jamie Dimon said that he does not think that cryptocurrency projects pose an existential threat to JPMorgan’s core business.
/jlne.ws/326wfmt

Ethereum Tokens to Trade on Swiss Stock Exchange via R3 Tech
Ian Allison – Coindesk
Public blockchain tokens will soon be trading on a major securities exchange. Revealed exclusively to CoinDesk, Swiss security token firm BlockState plans to “passport” half a dozen ERC-20 tokens from ethereum, the second-largest public blockchain, to Corda, the private distributed ledger technology (DLT) platform developed by R3.
/jlne.ws/32h754K

BitMEX to launch bitcoin zero coupon bond in the ‘next few weeks’
The Block
Cryptocurrency derivatives exchange BitMEX is preparing to launch bitcoin zero coupon bond in the “next few weeks,” its CEO Arthur Hayes told Bloomberg from the sidelines of the Asia Blockchain Summit in Taipei. “Something that we’re really keen on working on is fixed income. So, in the next few weeks, we will be revealing that we have the first bitcoin zero coupon bond with a few counterparties that we have identified,” said Hayes.
/jlne.ws/2XHCjSV

‘Dr Doom’ economist Nouriel Roubini in Bitcoin battle
BBC News
Outspoken economist Nouriel Roubini, nicknamed Dr Doom for his gloomy warnings, has caused a stir with his latest attack on Bitcoin and its fellow cryptocurrencies. Prof Roubini, who foresaw the financial crisis, says Bitcoin is “overhyped”. At a summit in Taiwan on Tuesday, he likened it to a “cesspool”. But his sparring partner at the event, who runs a cryptocurrency exchange, has angered the professor by blocking the release of video of the event.
/jlne.ws/2RUExJl

Germany shows Facebook might be on to something with Libra; Whether the new digital coin flops or not, payments in Europe is ripe for disruption
Martin Arnold – FT
As I prepare to move to a new job in Germany, two big stories have caught my eye that together produce a troubling message for Europe: Facebook’s plan for a new digital currency and the woes of Deutsche Bank.
/jlne.ws/323b04R

World’s First Zero-Fiat ‘Bitcoin Bond’ Now Available on Bloomberg Terminal
William Suberg – Cointelegraph
Two European companies have launched what they describe as the world’s first genuine bitcoin (BTC) bond, they confirmed in a joint press release on July 3. Luxembourg-based Argento, a securitization firm, joined forces with London Block Exchange (LBX) to issue the bitcoin-denominated bond, which is regulated under the United Kingdom’s regulator, the Financial Conduct Authority (FCA).
/jlne.ws/2LBZ843

BitFlyer to Resume Opening New Accounts After One Year Voluntary Suspension
Daniel Kuhn – Coindesk
BitFlyer, a Tokyo-based crypto exchange, will resume opening new domestic accounts beginning July 3 after voluntarily suspending the activity one year ago, according to a statement.
/jlne.ws/2NvhkPy

Libra Currency Could Pose Tax Challenges
PYMNTS
With the idea of pegging Libra’s value to a basket of international currencies, Facebook’s proposed cryptocurrency would bring tax challenges to European users, per tax lawyers. These issues would hamstring the digital currency’s mainstream adoption, the Financial Times reported.
/jlne.ws/2NEqEki

Globacap Partners With Archax For Digital Securities Trading – Archax To Provide Secondary Market For Token Issuances
Mondovisione
Archax, the forthcoming London-based institutional digital securities exchange, today announced a partnership with Globacap, a regulated primary issuance platform for security tokens also based in London. Under this partnership, Globabcap will use Archax as a secondary market for the digital securities it creates for its clients, and Archax will integrate its exchange with the Globacap platform.
/jlne.ws/2NqNDz3

Politics

US lawmakers seek ‘immediate’ halt to Facebook’s digital coin; Democrats want regulators and Congress to examine Libra’s risk to financial stability
Hannah Murphy – FT
US lawmakers have called on Facebook to halt its plans to launch a digital currency “immediately”, until regulators and Congress have examined the risks the project poses to consumers and wider financial stability.
/jlne.ws/3287IgD

Congress Holds First Fintech Task Force Hearing, Focuses on Innovation Regulation
Jon Bouker, Katherine Flocken, Arent Fox – JD Supra
The House Financial Services Committee’s new task force on fintech held its first hearing on Tuesday, June 25th, regarding the regulatory response to fintech’s rapid expansion and the impact it is having on consumers as well as the financial services industry overall.
/jlne.ws/325Advs

Christopher Waller, Judy Shelton Are Trump’s Latest Picks for Fed Board; President to nominate pair of economists after two of his original choices withdrew themselves from consideration
Paul Kiernan and David Harrison – WSJ
President Trump plans to nominate economists Judy Shelton and Christopher Waller to fill two board vacancies at the Federal Reserve, after months of pressing the central bank to lower interest rates.
/jlne.ws/326wkqo

IMF’s Christine Lagarde Wins EU Support to Lead European Central Bank; Mario Draghi’s eight-year term ends Oct. 31; official appointment of Ms. Lagarde likely to arrive in coming months
Valentina Pop and Brian Blackstone – WSJ
International Monetary Fund chief Christine Lagarde is likely to become the first woman to run the European Central Bank, putting an experienced crisis fighter in charge and paving the way for a continuation of easy-money policies.
/jlne.ws/31ZjBWe

House Panel Sues Treasury for Trump Tax Returns; Lawsuit aims to get a federal court to enforce a statute that gives Congress access to anyone’s tax returns
Richard Rubin – WSJ
The House’s tax-writing committee sued the Treasury Department and the Internal Revenue Service on Tuesday for access to President Trump’s tax returns, hoping federal judges will pry loose records that the administration has refused to hand over.
/jlne.ws/328pvEL

US aggression on the dollar will prove costly
Mark Sobel – Financial Times
If “weaponising” trade and financial sanctions did not suffice, the Trump Administration is stepping up its aggression on the dollar and foreign exchange markets. Indeed, it is even seeking to institutionalise this aggression in US foreign exchange policy. The Administration’s mistaken approach will hurt America and weaken the international monetary system.
/jlne.ws/327Q2BS

Elizabeth Warren Starts Winning Begrudging Respect on Wall Street
Lananh Nguyen and Tyler Pager – Bloomberg
Financiers drawn to her intelligence, views on social issues; Senator’s focus on inequality goes mainstream, professor says
There’s a new whisper on Wall Street — maybe Elizabeth Warren isn’t so bad.
/jlne.ws/32aLVFt

It’s Not Just Warren. The Next Democratic President Is Coming for Your Monopoly
Mike Dorning – Bloomberg
Leading 2020 candidates see antitrust action as long overdue; Industries across the U.S. economy could see tougher stance
Elizabeth Warren slammed Washington for failing to challenge giant corporations. Bernie Sanders assailed the power of Wall Street and the pharmaceutical industry. Cory Booker vowed to appoint more judges and antitrust enforcers and even Joe Biden is preparing a trust-busting plan.
/jlne.ws/326yQNm

At border, grim realities of crisis collide with 2020 campaign politics
Nick Miroff , Annie Linskey and Josh Dawsey – The Washington Post
Homeland Security officials thought they finally were getting a handle on the crisis at the Mexican border, after warning for months that agents and holding cells were beyond “the breaking point.” The record surge of Central American families has started to abate. The Mexican government has launched a broad crackdown after a deal with President Trump. And in a rare example of bipartisan action, lawmakers last week approved $4.6 billion in supplemental funding, most of it to improve care for minors who arrive without parents.
/jlne.ws/2LvFl6e

Federal court dismisses Wisconsin redistricting case
Riley Vetterkind – Wisconsin State Journal
A panel of federal judges dismissed Wisconsin’s high-profile redistricting lawsuit on Tuesday after a U.S. Supreme Court ruling last week determined claims against partisan gerrymandering are beyond the reach of federal courts. The dismissal puts an end to the Wisconsin gerrymandering case that once went in front of the nation’s high court and had a chance to drastically change how states draw political maps.
/jlne.ws/2LycNcl

Regulation

ASIC Consults On Relief For Foreign Providers Of Funds Management Services To Australian Professional Investors
ASIC
ASIC has today released a consultation paper proposing to provide licensing relief for foreign financial services providers of funds management services in Australia to professional investors.
/jlne.ws/328svB1

Mifid II continues global spread, albeit with regional nuance, says expert; US supports unbundling and increased transparency, but debate remains over payment mechanism
Andrew Holt – IRMagazine
The internationalization of Mifid II continues apace, especially in the US, albeit with a regional slant, according to a leading expert on the issue.
/jlne.ws/3293c1G

Insider trading trial, HSBC and Huawei and Credit Suisse tax dispute; The Financial Times banking team discusses the biggest banking stories of the week, bringing you global insight and commentary on the top issues concerning this sector. To take part in the show or to comment please email audio@ft.com
FT
Patrick Jenkins discusses the Financial Conduct Authority’s latest insider trading case and what it tells us about how market abuses are being tackled, why HSBC is on the defensive in China, and why Credit Suisse is suing the UK tax authorities.With special guest Mark Steward, Director of Enforcement and Market Oversight for the Financial Conduct Authority.
/jlne.ws/3292rFS

SEC Staff to Host July 18 Roundtable on Short-Term / Long-Term Management of Public Companies, Our Periodic Reporting System and Regulatory Requirements
SEC
The Securities and Exchange Commission today announced that its Division of Corporation Finance will host a roundtable on July 18, 2019 to hear from investors, issuers, and other market participants about the impact of short-termism on our capital markets and whether our reporting system, or other aspects of our regulations, should be modified to address these concerns.
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CFTC to Hold an Open Commission Meeting on July 11
CFTC
Commodity Futures Trading Commission (CFTC) Chairman J. Christopher Giancarlo announced today that the CFTC will hold an open meeting on Thursday, July 11 at 10:00 a.m. at its headquarters in Washington, D.C. to consider the following:
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CFTC Charges Hedge Fund with Violating Wheat Futures Speculative Position Limits
CFTC
The Commodity Futures Trading Commission (CFTC) today issued an Order filing and settling charges against Elephas Investment Management Ltd. (Elephas), a Hong Kong based hedge fund, for violating wheat futures speculative position limits. The Order requires Elephas to pay a $160,000 civil monetary penalty.
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FINRA Orders Summit Brokerage Services, Inc. to Pay More Than $550,000 in Restitution to Customers Whose Accounts Were Excessively Traded; Firm Sanctioned for Failing to Reasonably Supervise Recommended Securities Transactions and Use of Consolidated Reports
FINRA
FINRA announced today that it has sanctioned Summit Brokerage Services, Inc. (Summit) a total amount exceeding $880,000 for supervisory failures, including approximately $558,000 in restitution to customers whose accounts were excessively traded by a former registered representative of the firm who was previously barred by FINRA.
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Investing and Trading

UK mulls mandatory climate disclosure for listed companies
S&P Global
The UK government is considering mandatory climate risk disclosure for listed companies and large asset owners, according to its Green Finance Strategy released Tuesday.
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Don’t Blame Politics for China’s Ban on U.S. Pork
David Fickling – Bloomberg
The African swine fever epidemic has pushed up Chinese wholesale pork prices by a quarter since the start of March. As much as a fifth of the country’s herd has been culled. So why won’t Beijing import American meat? The prospect of replacing all those cuts lost to the cull would represent “the single greatest sales opportunity in our industry’s history” if China only removed import tariffs, according to the National Pork Producers Council.
/jlne.ws/32965zi

Institutions

Société Générale chairman admits it was too slow to fire traders; French bank’s shares are one of the worst performers in Europe’s banking sector
David Crow – FT
The chairman of Société Générale has conceded the French bank was too slow to cut jobs at its struggling securities trading unit, as it tries to regain investor confidence following a collapse in its share price.
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How H2O doubled down on Lars Windhorst in his hour of need; London-based asset manager has deep and enduring ties to racy German financier
Cynthia O’Murchu and Robert Smith – FT
The Lars Windhorst affair has left H2O Asset Management battling to preserve its reputation.
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Woodford cash calls raise doubts over £150m Northern Trust loan; Chicago bank cites ‘500% collateral’ but valuations under pressure
Peter Smith in London and Robert Armstrong – FT
Neil Woodford is facing further cash calls from his investment companies, raising doubts over his ability to repay a £150m overdraft facility from Northern Trust, the Chicago-based bank.
/jlne.ws/323ai7H

Credit Suisse wealth management head leaves after power struggle; Iqbal Khan had grown frustrated with position under CEO Tidjane Thiam
Stephen Morris, David Crow, Arash Massoudi and Alice Ross – FT
A power struggle at the top of Credit Suisse has resulted in the departure of its head of wealth management after he grew frustrated with his profile and future under chief executive Tidjane Thiam, according to several people with knowledge of the events.
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Deutsche Bank held talks with Citi, BNP on shedding chunk of equities business – WSJ
Reuters
Deutsche Bank has held talks with Citigroup Inc, BNP Paribas SA and others that could involve transferring parts of its equities business, including operations that serve hedge funds and other big trading customers, the Wall Street Journal reported on Tuesday.
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Jefferies Group quarterly profit rises 12% on strength in trading
Reuters
Jefferies Group LLC on Wednesday reported a 12% rise in second-quarter profit, driven by strength in its bond and equity trading businesses.
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Regions

New York takes first-half IPO crown as Hong Kong wilts; Big listings from the likes of Alibaba and AB InBev set to lift territory in second half
Hudson Lockett and Mercedes Ruehl – FT
New York has claimed the global initial public offerings crown for the first half of 2019, with equity fundraising in Hong Kong falling by more than a quarter during that period as Chinese technology firms favoured Wall Street.
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Hong Kong protests, Beijing’s tightening grip rattle business community
Iris Yuan, Vimvam Tong – Reuters
Chaotic scenes of protesters rampaging through Hong Kong’s legislature, trashing furniture and daubing graffiti over walls have sent jitters through the business community, which worries about the impact on the city’s status as a financial hub.
/jlne.ws/3293eGQ

World’s top pension fund warns against risk of green-bond ‘fad’; GPIF investment chief not convinced green bonds will break mainstream
Nikou Asgari – FT
A top executive at the world’s biggest pension fund has expressed doubts over green bonds, saying that, without fundamental changes, the asset class risks becoming a “passing fad”.
/jlne.ws/326v4U5

EU’s palm oil energy use soars despite deforestation threat; Many motorists are driving on vegetable oil without knowing it, says environment group
Emiko Treasono – FT
Palm oil has long been a mainstay in food and cosmetics. However, its lesser-known uses — in biodiesel for cars and trucks and for heating and electricity — have hit an all-time high in Europe, accounting for 65 per cent of all consumption, according to Oilworld, which provides data on vegetable oils.
/jlne.ws/323bFTT

India’s shadow banking crisis sparks credit crunch; Small businesses are worried they will be unable to secure new funding
Benjamin Parkin – FT
In his noisy workshop off a dirt road, Rajaram Yadav uses lathes and other tools to craft stainless steel pipes and parts for use in India’s chemical factories.
/jlne.ws/328qd4T

Opec is stuck in a production-cutting cycle it cannot get out of; Cartel has propped up the oil price but has done so at the expense of market share
Anjli Raval and David Sheppard – FT
Saudi Arabia’s energy minister delivered only one message that mattered at the meeting of Opec and its allies this week: together we believe we can outlast the US shale industry.
/jlne.ws/326tbqt

Hong Kong Bans Former Goldman Sachs Banker Leissner for Life
Sam Mamudi – Bloomberg
Hong Kong’s Securities and Futures Commission banned former Goldman Sachs Group Inc. banker Tim Leissner from the city’s financial industry for life.
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Don’t Blame Politics for China’s Ban on U.S. Pork; It’s an additive in American meat, not the trade war, that’s keeping Beijing from increasing imports as swine flu cuts domestic supplies.
David Fickling – Bloomberg
The African swine fever epidemic has pushed up Chinese wholesale pork prices by a quarter since the start of March. As much as a fifth of the country’s herd has been culled. So why won’t Beijing import American meat?
/jlne.ws/32965zi

High trading costs impact liquidity of Indian equities: study
Ashish Rukhaiyar – The Hindu
‘Turnover ratio fell by 60% in 10 years’
With the Union Budget just a couple of days away, a recent study has shown that the turnover ratio of the Indian stock market has fallen significantly in the last 10 years.
/jlne.ws/2NvhrdW

Brexit

Irish Brexit border issue cannot be solved by tech alone – former UK official
Reuters
There is no technology solution that alone can solve the issue of the border between Northern Ireland and the Irish Republic in a no-deal Brexit scenario, the British official who was in charge of Brexit border preparations said on Wednesday.
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London’s Fight to Remain a Financial Hub After Brexit
Silla Brush and Alexander Weber – Bloomberg
London’s emergence three decades ago as Europe’s undisputed financial capital was sudden and transformational. There are fears that the U.K.’s pending divorce from the European Union, Brexit, will cause a precipitous decline. The City of London financial district handles trillions of dollars, euros and pounds worth of currency and derivatives trading each day, and the U.K.’s financial-services industry accounted for 11% of all taxes paid in 2018. By one estimate, U.K. firms derive one-quarter of their revenue from EU-related business. At a minimum, Brexit will make it harder to trade with the EU from London. A particularly messy split could sever some links and disrupt business.
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EU picks divided on how to handle Brexit
Charles Michel has become frustrated by UK but Ursula von der Leyen urges patience
Jim Brunsden and Alex Barker – FT
The EU has picked two new presidents with two different views of how to deal with Brexit.
/jlne.ws/3243EON

Hammond signals he will fight a no-deal Brexit; Chancellor warns of £90bn-a-year cost and says would resist leaving EU without MPs’ agreement
George Parker – FT
Chancellor Philip Hammond has put himself at the head of Conservative opposition to a no-deal Brexit, warning it could cost the Treasury over £90bn a year.
/jlne.ws/323KXuq

EU picks divided on how to handle Brexit; Charles Michel has become frustrated by UK but Ursula von der Leyen urges patience
Jim Brunsden and Alex Barker – FT
The EU has picked two new presidents with two different views of how to deal with Brexit.
/jlne.ws/326ukON

Miscellaneous

How a £100m student accommodation scheme went wrong
Thomas Hale
A short walk from the centre of Stoke-on-Trent, a new student accommodation block is nearing completion. The lights work, the water runs from the taps, and the hundreds of rooms have beds in them. The problem is that there are no students.
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10 mind-blowing facts that show just how dire the student-loan crisis in America is
Hillary Hoffower and Allana Akhtar – Business Insider
America is suffering from a student-loan debt crisis. While wages have increased by 67% since 1970, according to a 2018 Student Loan Hero report, college tuition has increased at an even faster rate. Consequently, student debt has reached record levels. It’s part of the Great American Affordability Crisis. Coupled with the fallout from the recession and a high cost of living, student-loan debt has made it difficult for millennials to save and has forced them to delay milestones like getting married, buying a house, and having kids.
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