January 2024 - cypherpunks - lists.cpunks.org

Ex-Pfizer Compliance Officer Revamps Whistleblower Suit
by Gunnar Larson 31 Jan '24

31 Jan '24

Ex-Pfizer Compliance Officer Revamps Whistleblower Suit <https://www.law360.com/governmentcontracts/articles/1791860?nl_pk=4126fe73-…> By Hannah Albarazi A former Pfizer compliance officer said he endured harassment and discrimination before being fired in retaliation for reporting the pharmaceutical giant to the U.S. Securities and Exchange Commission over concerns that it was potentially violating the Foreign Corrupt Practices Act, according to an amended complaint filed in California federal court. 1 document attached | Read full article » <https://www.law360.com/governmentcontracts/articles/1791860?nl_pk=4126fe73-…> | Save to favorites » <https://www.law360.com/governmentcontracts/articles/1791860?nl_pk=4126fe73-…>

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Fwd: Your Freedom of Information Law (FOIL) Request FOIL-2023-095358-021437 - DFS Investigation Finds Robinhood Crypto Failed to Maintain Effective and Compliant BSA/AML and Cybersecurity Programs
by Gunnar Larson 31 Jan '24

31 Jan '24

---------- Forwarded message --------- From: <Joanne.Verdejo(a)dfs.ny.gov> Date: Wed, Jan 31, 2024, 12:35 PM Subject: Your Freedom of Information Law (FOIL) Request FOIL-2023-095358-021437 To: <G(a)xny.io> Good afternoon, Attached please find correspondence from the NYS Department of Financial Services, pertaining to your FOIL request. Thank you. Tracking Number:FOIL-2023-095358-021437 --- SENT VIA EMAIL G(a)xny.io January 31, 2024 Gunnar Larson xNY.io Bank.org 406 West 25th Street New York, NY 10001 Re: FOIL Tracking No. 2023-095358 Dear Gunnar Larson: I write with respect to your above-referenced FOIL request, assigned the tracking number 2023- 095358. The New York State Department of Financial Services (DFS) requires additional time to complete its response to your request. DFS anticipates completing your request on or about March 8, 2024. We appreciate your continued patience. Thank you. ---------- Forwarded message --------- From: <noreply(a)its.ny.gov> Date: Tue, Jun 27, 2023, 6:52 PM Subject: FOIL Request Confirmation from Open FOIL NY To: <G(a)xny.io> Thank you for submitting your FOIL request through Open FOIL NY. Here is your Open FOIL NY confirmation information for future reference: LARSON_DFS_20230627185237536 INFORMATION SUBMITTED: Records Requested From Department of Financial Services Short Title DFS Investigation Finds Robinhood Crypto Failed to Maintain Effective and Compliant BSA/AML and Cybersecurity Programs Description Dear Madam or Sir: On August 2, 2022 the Superintendent of Financial Services Adrienne A. Harris announced that Robinhood Crypto, LLC (“RHC”) would pay a $30 million penalty to New York State for significant failures in the areas of bank secrecy act/anti-money laundering (“BSA/AML”) obligations and cybersecurity that resulted in violations of the Department’s Virtual Currency Regulation (23 NYCRR Part 200), Money Transmitter Regulation (3 NYCRR Part 417), Transaction Monitoring Regulation (23 NYCRR Part 504), and Cybersecurity Regulation (23 NYCRR Part 500). xNY.io - Bank.org would like to receive any and all records related to NY-DFS' investigation of Robinhood Crypto. Including (but not limited to) records concerning the bespoke Supervisory Agreement Robinhood Crypto has with the Department of Financial Services mentioned here: https://www.dfs.ny.gov/reports_and_publications/press_releases/pr202208021. In addition, xNY.io - Bank.org seeks any and all records concerning New York's approach to Robinhood Crypto and Goldman Sachs compliance programs mandated by the United States Department of Justice, Criminal Division, Fraud Section and Money Laundering and Asset Recovery Section mentioned here: https://drive.google.com/file/d/1Yx88RMoeLyyfbNK0RtPl4r-m8N21_1Sp/view?usp=…. Finally, xNY.io - Bank.org seeks records concerning New York's regulatory approval of Robinhood Crypto engaging a fine of $30M to implement heightened controls and additional procedures and policies relating to electronic surveillance and investigation, due diligence on transactions or clients and the use of third-party intermediaries across business units; and enhancing anti-corruption training for all management and relevant employees. Warm regards, Gunnar Larson xNY.io - Bank.org 917-580-8053 Uploaded Files FOIL Response Format Email If fees apply, please contact me if costs will be greater than $10000 Your FOIL request has been forwarded to the organization(s) you selected, and the respective Records Access Officer will contact you directly for further processing of your request. Please allow up to five business days for such communication(s). For your convenience, here is additional contact information: Department of Financial Services One State Street 20th Floor New York, NY 10004

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4th Circ. Revives Combat IP Theft Suit Against Israeli Co
by Gunnar Larson 31 Jan '24

31 Jan '24

4th Circ. Revives Combat IP Theft Suit Against Israeli Co. <https://www.law360.com/governmentcontracts/articles/1791745?nl_pk=4126fe73-…> By Dorothy Atkins The Fourth Circuit on Tuesday revived an American combat training company's trade secret theft lawsuit against an Israeli company, its U.S. affiliate, a military officer and the Israeli Ministry of Defense, finding the trial court wrongly relied on a prior judgment, which didn't address the Delaware-based affiliate. Opinion attached | Read full article » <https://www.law360.com/governmentcontracts/articles/1791745?nl_pk=4126fe73-…> | Save to favorites » <https://www.law360.com/governmentcontracts/articles/1791745?nl_pk=4126fe73-…>

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West Point Tells Justices Challenge To Admissions Is Too Late
by Gunnar Larson 31 Jan '24

31 Jan '24

West Point Tells Justices Challenge To Admissions Is Too Late <https://www.law360.com/newyork/articles/1791600?nl_pk=ac5a3855-e47c-4403-be…> By Katie Buehler West Point military academy urged the U.S. Supreme Court on Tuesday to deny Students for Fair Admissions Inc.'s request for a court order prohibiting the academy from using race in admissions decisions while a lawsuit is pending, alleging the group's "manufactured" need for relief is too late. Response attached | Read full article » <https://www.law360.com/newyork/articles/1791600?nl_pk=ac5a3855-e47c-4403-be…> | Save to favorites » <https://www.law360.com/newyork/articles/1791600?nl_pk=ac5a3855-e47c-4403-be…>

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NRA GC Says LaPierre Sidestepped Some Legal Approvals
by Gunnar Larson 31 Jan '24

31 Jan '24

NRA GC Says LaPierre Sidestepped Some Legal Approvals <https://www.law360.com/compliance/articles/1791851?nl_pk=ab5ce197-c1fb-4d8e…> By Rachel Scharf The general counsel of the National Rifle Association defended former CEO Wayne LaPierre as "very open and honest" during testimony in the New York attorney general's fraud trial Tuesday, but said LaPierre at times made consequential legal decisions without consulting him or the organization's board. Read full article » <https://www.law360.com/compliance/articles/1791851?nl_pk=ab5ce197-c1fb-4d8e…> | Save to favorites » <https://www.law360.com/compliance/articles/1791851?nl_pk=ab5ce197-c1fb-4d8e…>

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The Questions Around Prometheum's SEC-Compliant Strategy
by Gunnar Larson 31 Jan '24

31 Jan '24

The Questions Around Prometheum's SEC-Compliant Strategy <https://www.law360.com/banking/articles/1789752?nl_pk=feb6bbba-7878-4d39-be…> While the rest of the crypto industry has been engaged in a long-running battle to escape the U.S. Securities and Exchange Commission's jurisdiction, a once-obscure startup called Prometheum has instead embraced the SEC's view to become the first crypto special-purpose broker-dealer, but it's unclear whether it can turn its favored status into a workable business, says Keith Blackman at Bracewell. Read full article » <https://www.law360.com/banking/articles/1789752?nl_pk=feb6bbba-7878-4d39-be…> | Save to favorites » <https://www.law360.com/banking/articles/1789752?nl_pk=feb6bbba-7878-4d39-be…>

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Terraform Will Use Ch. 11 To Craft Appeal Of SEC Crypto Case
by Gunnar Larson 31 Jan '24

31 Jan '24

Terraform Will Use Ch. 11 To Craft Appeal Of SEC Crypto Case <https://www.law360.com/banking/articles/1791691?nl_pk=feb6bbba-7878-4d39-be…> By Alex Wittenberg An executive for crypto company Terraform Labs told the Delaware bankruptcy court Tuesday it has sought Chapter 11 protection mainly to delay a potentially existential U.S. Securities and Exchange Commission penalty tied to the implosion of its algorithmic stablecoin, the collapse of which in 2022 provoked a widespread crash in cryptocurrency markets. 2 documents attached | Read full article » <https://www.law360.com/banking/articles/1791691?nl_pk=feb6bbba-7878-4d39-be…> | Save to favorites » <https://www.law360.com/banking/articles/1791691?nl_pk=feb6bbba-7878-4d39-be…>

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PBS Drops Another Bombshell: Wall Street Is Gobbling Up Two-Thirds of Your 401(k)
by Gunnar Larson 31 Jan '24

31 Jan '24

https://wallstreetonparade.com/2013/04/pbs-drops-another-bombshell-wall-str… By Pam Martens: April 25, 2013 Frontline Chart Showing Impact of 401(k) Fees Over 50 Years of Saving for Retirement If you work for 50 years and receive the typical long-term return of 7 percent on your 401(k) plan and your fees are 2 percent, almost two-thirds of your account will go to Wall Street. This was the bombshell dropped by Frontline’s Martin Smith in this Tuesday evening’s PBS program, The Retirement Gamble. This is not so much a gamble as a certainty: under a 2 percent 401(k) fee structure, almost two-thirds of your working life will go toward paying obscene compensation to Wall Street; a little over one-third will benefit your family – and that’s before paying taxes on withdrawals to Uncle Sam. To put it another way – you work for Wall Street. You are their slave, their lackey and as long as their toadies dominate in Congress, nothing is going to change on the legislative front to stop the looting. Wall Street seized millions of homes through illegal foreclosures and stripped the equity from the owners. They got away with it. Some Wall Street firms further enriched themselves making bets that the housing market would collapse, using their inside knowledge of the bogus loans they had made. They got away with that also. Now Wall Street is busy asset stripping the retirement plans of the working class in America while President Obama proposes to cut Social Security benefits through a discredited calculation called Chained CPI – conveniently causing people to save more in their 401(k) plans to make up for the potential loss. But the more you save, the more Wall Street asset strips. The Retirement Gamble was written by the outstanding team of Martin Smith and Marcela Gaviria, who exposed in January that when it came to Wall Street, the U.S. Justice Department had “no investigations going on. There were no subpoenas, no document reviews, no wiretaps.” The head of the criminal division of the Justice Department, Lanny Breuer, announced he was stepping down one day after that program aired. He returned to Covington & Burling, the corporate law firm representing Wall Street firms. The revelation of the two-thirds wealth transfer machinery was delivered by none other than John Bogle, the legendary founder of The Vanguard Group, a low-load mutual fund firm, who served as its Chairman and CEO from 1974 to 1996. Bogle is no slouch. He’s one of the most highly respected men in finance and graduated magna cum laude from Princeton University with a degree in Economics. This is the relevant portion of the transcript from the program: Bogle: Costs are a crucial part of the equation. It doesn’t take a genius to know that the bigger the profit of the management company, the smaller the profit that investors get. The money managers always want more, and that’s natural enough in most businesses, but it’s not right for this business. Smith: Bogle gave me an example. Assume you’re invested in a fund that is earning a gross annual return of 7 percent. They charge you a 2 percent annual fee. Over 50 years, the difference between your net of 5 percent — the red line — and what you would have made without fees — the green line — is staggering. Bogle says you’ve lost almost two thirds of what you would have had. Bogle: What happens in the fund business is the magic of compound returns is overwhelmed by the tyranny of compounding costs. It’s a mathematical fact. There’s no getting around it. The fact that we don’t look at it— too bad for us. Smith: What I have a hard time understanding is that 2 percent fee that I might pay to an actively managed mutual fund is going to really have a great impact on my future retirement savings. Bogle: Well, you have to rely on somebody to get out a compound interest table and look at the impact over an investment lifetime. Do you really want to invest in a system where you put up 100 percent of the capital, you the mutual fund shareholder, you take 100 percent of the risk and you get 30 percent of the return? Smith takes Bogle’s advice and pulls up a compounding calculator on his laptop. On air, he shows the viewer the results: Smith: Take an account with a $100,000 balance and reduce it by 2 percent a year. At the end of 50 years, that 2 percent annual charge would subtract $63,000 from your account, a loss of 63 percent, leaving you with just a little over $36,000. There’s another way to prove the point. Pull up a compounding calculator on line. Take an account with a $100,000 balance and compound it at 7 percent for 50 years. That gives you a return of $ 3,278,041.36. Now change the calculation to a 5 percent return (reduced by the 2 percent annual fee) for the same $100,000 over the same 50 years. That delivers a return of $1,211,938.32. That’s a difference of $2,066,103.04 – the same 63 percent reduction in value that Smith’s example showed. Presently, 70 percent of Americans who have any kind of retirement plan at their place of employment have a 401(k) plan. Not everyone is paying 2 percent fees. Some are paying more and others are paying less – sometimes much less if using passively managed index funds. But, historically, Wall Street has preyed on the least informed and the least educated, which tends to be the poor and middle class. Consider the testimony of Gail Kubiniec, a former Assistant Manager at CitiFinancial, a unit of mega Wall Street firm Citigroup, to the Federal Trade Commission in 2001 concerning the premise on which she loaded on extra charges to loans: “I and other employees would often determine how much insurance could be sold to a borrower based on the borrower’s occupation, race, age, and education level. If someone appeared uneducated, inarticulate, was a minority, or was particularly old or young, I would try to include all the coverages CitiFinancial offered. The more gullible the consumer appeared, the more coverages I would try to include in the loan…” The Retirement Gamble can be viewed in its entirety here.

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Senator Sherrod Brown Takes on the Fed's Support of Wealth Stripping the Middle Class
by Gunnar Larson 31 Jan '24

31 Jan '24

https://wallstreetonparade.com/2024/01/senator-sherrod-brown-takes-on-the-f… By Pam Martens and Russ Martens: January 31, 2024 ~ Senator Sherrod Brown Senator Sherrod Brown Smart Americans have found two ways to outwit the wealth extraction machinery on Wall Street. They buy a home and build its value over time with sweat equity; and/or they start their own small business. A very large number of Americans who are living comfortably in retirement today built their wealth through one or both of these avenues. Wall Street banks, on the other hand, typically extract wealth from the little guy in a multitude of insidious ways – from high interest credit cards to excessive fees, tricked-up mortgages and outright frauds. Nothing better illustrated this wealth stripping than the 2013 PBS program from Frontline called The Retirement Gamble. The program documented the following: If you work for 50 years and receive the typical long-term return of 7 percent on the stock mutual funds in your 401(k) plan, and your fees are 2 percent, almost two-thirds of your account will go to Wall Street. (We fact-checked the math and it’s correct; read our report here. Also see Related Articles linked below for more insight into how wealth stripping works.) If an individual attempts to legally challenge being ripped off by Wall Street, they will end up in a private justice system created by Wall Street lawyers and run by a self-regulatory agency. You will not be allowed to take your claim to one of the nation’s courts where juries are randomly selected from a large pool of fellow citizens. You will have limited discovery and the arbitrators of your claim do not have to follow legal precedent or case law. Even when serious financial crimes are committed against our cities and counties, causing mass layoffs and economic suffering to millions, no one will go to jail. Prosecutors will allow Wall Street to pay a fraction of the amount stolen and walk away. After each illegal cartel on Wall Street is exposed, removing any doubt that this is an institutionalized wealth transfer system, new Wall Street cartels crop up faster than you can say “where are the customers yachts.” Add dark pools, high frequency trading, and stock exchange collusion to the 401(k), private justice system and cartel fleecing activity and you have an almost perfect system for wealth transfers with impunity. Many Americans believe that the Federal Reserve (“the Fed”) is the linchpin to Wall Street’s wealth transfer program to the 1 percent. Yesterday, the Chair of the Senate Banking Committee, Senator Sherrod Brown (D-OH), raised similar concerns in a hard-hitting letter to Fed Chair Jerome Powell. Brown wrote in part: “…Because monetary policy operates on a lag, keeping interest rates elevated will continue to apply downward pressure on the labor market and wages, and drive up mortgage costs, while doing nothing to tackle the cause of continued high prices. When the Fed justifies higher interest rates for the sake of weakening demand, that is, in effect, a euphemism for suppressing wages and job creation. The burden of attaining price stability should not fall on the backs of workers and home-buyers… “To lower costs for all Americans, we must address inflation’s root causes without undercutting economic growth. Monetary policy does nothing to address the underlying cause of higher prices – namely, corporate price-gouging – but it does undermine economic growth. Higher rates are locking Americans out of the two primary means for building wealth—buying a home and starting or growing a small business… “Higher rates hurt prospective home buyers. I hear from so many Ohioans that they feel trapped – those who rent feel like they’ll never be able to afford to buy and those who already own their homes feel like they will never be able to afford a larger one if they decide to grow their family. Prices have been too high for too long for both renters and homebuyers across the country, and these challenges have only grown more acute as interest rates have stayed elevated. For prospective home buyers, the same mortgage for a home purchased today costs nearly double what it did in 2020. Higher rates have also given corporations an advantage over consumers in the housing market. As consumers face elevated interest rates, many of the biggest real estate investors have access to cheaper Wall Street financing, allowing them to buy up real estate with all-cash offers based on financing costs a working family could never get. As a result, institutional investors – including private equity and S&P 500 companies – are buying up formerly affordable manufactured housing communities and affordable single-family homes in far too many communities. Homeownership is the primary means for working-class and middle-class families to acquire wealth, and higher interest rates are making it harder for them to afford a mortgage to purchase a home, denying them the opportunity to build intergenerational wealth. “Higher interest rates are hindering growth in the housing supply. High interest rates are also contributing to high housing costs by exacerbating our years-long housing shortage as they limit affordable housing providers’ ability to finance new construction at price points that workers can afford. As a result, housing production remains thousands of units behind each year in communities across the country, and renters are forced to pay high prices month after month. In 2022, a record half of renters were paying more than they could afford for housing, pushing their ability to save for a down payment further out of reach. If affordable housing providers remain unable to build new units that these workers can afford, housing costs will only continue to contribute to rising prices. “Higher interest rates stall small business growth. Tightened credit conditions are making it difficult for small businesses to thrive. Keeping the policy rate higher for longer has driven up the cost of credit for small business loans. Today, a small business seeking to take out a loan will pay on average 9.3% in interest. For the small businesses who have already taken out loans, higher rates will increase their interest burden in 2024. Consequently, 9-out-of-10 small businesses think now is not a good time to expand their business. Small businesses employ half of America’s workers and higher rates are discouraging them from both hiring workers and increasing their employees’ wages to keep up with inflation. “For working Americans and small businesses who already feel the crush of inflation, higher housing costs and reduced access to credit will only make it worse. Keeping interest rates high will be detrimental to American workers and their families and do little to bring down prices or promote moderate economic growth. While more must be done to address the fact that costs remain too high, it is becoming increasingly evident that restrictive monetary policy is no longer the right tool for combatting inflation, and I urge the Federal Reserve to ease monetary policy early this year.” The wealth extraction machine on Wall Street does, however, benefit from higher interest rates. Because those rates drive more people into the need to borrow, the mega banks on Wall Street, which are also among the largest credit card providers, can charge higher interest rates on their credit cards to a growing number of desperate consumers. Today, the Fed will make its announcement on interest rates at 2 p.m., followed by Fed Chair Powell’s press conference at 2:30 p.m. One thing you can expect to hear from Powell is how everything the Fed does is to help the American people. Powell came from the private equity wealth extraction firm, the Carlyle Group. Related Articles: These Are the Banks that Own the New York Fed and Its Money Button Mr. Gensler, the U.S. Stock Market Structure Is an Institutionalized Wealth Transfer System Ten Things You Can Do Now to Curb Wall Street’s Wealth Transfer System There’s a Trump Era/Charles Koch Big Law Firm Behind the Supreme Court Case that Hopes to Gut the Federal Agency that Fights for the Little Guy Wall Street’s Wealth Transfer System Is Imperiling the U.S. Economy As This Crypto Stock’s Price Collapsed, Goldman, JPMorgan and Citigroup Issued Buy Ratings

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American Airlines Sued Over Loyalty Account Closures
by Gunnar Larson 31 Jan '24

31 Jan '24

American Airlines Sued Over Loyalty Account Closures <https://www.law360.com/banking/articles/1791665?nl_pk=feb6bbba-7878-4d39-be…> By Emilie Ruscoe American Airlines Inc. faces a proposed class action in federal court brought by members of its loyalty program accusing the company of improperly closing certain members' accounts and wiping out their accrued airline miles. Complaint attached | Read full article » <https://www.law360.com/banking/articles/1791665?nl_pk=feb6bbba-7878-4d39-be…> | Save to favorites » <https://www.law360.com/banking/articles/1791665?nl_pk=feb6bbba-7878-4d39-be…>

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