March 24, 2015
Big Foreign Banks Get Rejected By American Regulators
Posted by David Zaring

One of the things you now have to do if you're a bank with over $50 billion in American assets is to file a resolution plan, or living will, with the authorities - this basically states how you are going to dispose of the company if it becomes insolvent.  After passing all the big American banks through an annual set of stress tests, the regulators have turned their attention abroad:

In their review of the resolution plans from BNP Paribas, HSBC Holdings plc, and The Royal Bank of Scotland Group plc, the agencies noted some improvements from the original plans. However, the agencies have jointly identified specific shortcomings with the 2014 resolution plans that will need to be addressed in the 2015 submissions.

It's annoying enough to be told by some foreign regulator that you aren't sufficiently prepared for a disaster, given that you're home regulator is telling you that you are.  But it must be especially annoying if you are a state-owned bank, which RBS is, to the tune of 66% of its outstanding shares. That's almost a foreign relations issue.  And given that the resolution of international banks like these is one of the most difficult issues facing bank regulators - there has been a failed effort to create a framework going on since Lehman Brothers failed so chaotically - it must be grating to be told to revise the plan:

The agencies will require that the annual plans submitted by these three institutions on or before December 31, 2015, demonstrate that the firms are making significant progress to address all the shortcomings identified in the letters, and are taking actions to improve their resolvability under the U.S. bankruptcy code.  These actions include:

  • Amending the financial contracts entered into by U.S. affiliates to provide for a stay of certain early termination rights of external counterparties triggered by insolvency proceedings to the extent those rights are not addressed by the International Swaps and Derivatives Association 2014 Resolution Stay Protocol;
  • Ensuring the continuity of shared services that support critical operations and core business lines throughout the resolution process; and
  • Demonstrating operational capabilities for resolution preparedness, such as the ability to produce reliable information in a timely manner.

Those are actual requirements!  The first one anyway.  The other two could be goalposts that just get moved further away next time.  Anyway, one question in the brave new world of international banking supervision is whether supervision is a tool that home banks are using for competitive advantage against foreign banks.  It will be interesting to see whether this sort of charge is leveled at this sort of action.

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March 05, 2015
Happy Stress Test Day!
Posted by David Zaring

The 31 banks subject to stress tests - to see how their positions would hold up if the economy hypothetically tanked - all passed, good news for them, and especially for Citi, which failed the last one, and vowed not to do so again.  More here, featuring a picture of former law professor/current Fed board member Dan Tarullo, who supervised the test.  And if you're thinking of investing in banks, the Times has a chart of the percentage of money-like assets in the banks' total assets mix.  If you are risk averse, you want to invest in Deutsche Bank or Discover.  But I think leverage is the most powerful force in the world, so hello, Goldman Sachs and Morgan Stanley!

 

 

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February 19, 2015
Gary Osen, Scourge of Banks
Posted by David Zaring

Here's an interesting profile of the guy who is going after banks that held money eventually used in terrorist activities by clients - a potentially long list of defendants, if he can make the legal theory stick.  He came up with that theory, by the way, by noodling it out with one of his law school professors.  HT: Matt Levine

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February 09, 2015
Suicide By Cop, Filed By A Decent Firm?
Posted by David Zaring

I'll outsource the content to Matt Levine's new email, but you just don't see briefs filed by financial businesses against their regulators like the one Powhatan Capital filed against FERC, abetted by one of Philadelphia's good law firms.

There are sections headed "Dr. Chen’s Trades Were Not 'Wash-like' Or 'Wash-type' -- Whatever The Heck That Means," "The Staff’s Stubborn Reliance On The Unpublished, Non-Precedential Amanat Case Is Just Lame," and "Uttering the Phrase 'Enron' Or 'Death Star' Does Not Magically Transform The Staff’s Investigation." It's like an angry trader's dream of what a legal brief might look like ("This is America"!)

It's really quite amusing - check it out.

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January 30, 2015
The Ethical Slide, Train Tickets, and Helping the Next Generation of Corporate Leaders to Choose Differently
Posted by Josephine Sandler Nelson

It has been a pleasure to guest-blog for the last two weeks here at the Glom. (Previous posts available here: one, two, three, four, five, six, seven, eight, and nine.) This final post will introduce the book that Lynn Stout and I propose writing to give better direction to business people in search of ethical outcomes and to support the teaching of ethics in business schools.

Sometimes bad ethical behavior is simply the result of making obviously poor decisions. Consider the very human case of Jonathan Burrows, the former managing director at Blackrock Assets group. Burrows’s two mansions outside London were worth over $6 million U.S., but he ducked paying a little over $22 U.S. in train fare each way to the City for five years. Perhaps Burrows had calculated that being fined would be less expensive than the inconvenience of complying with the train fare rules. Unluckily, the size of his $67,200 U.S total repayment caught the eye of Britain’s Financial Conduct Authority, which banned Burrows from the country’s financial industry for life. That’s how we know about his story.

But how do small bad ethical choices snowball into large-scale frauds? How do we go from dishonesty about a $22 train ticket to a $22 trillion loss in the financial crisis? We know that, once they cross their thresholds for misconduct, individuals find it easier and easier to justify misconduct that adds up and can become more serious. And we know that there is a problem with the incentive structure within organizations that allows larger crises to happen. How do we reach the next generation of corporate leaders to help them make different decisions?

Business schools still largely fail to teach about ethics and legal duties. In fact, research finds “a negative relationship between the resources schools possess and the presence of a required ethics course.” Moreover, psychological studies demonstrate that the teaching of economics without a strong ethical component contributes to a “culture of greed.” Too often business-school cases, especially about entrepreneurs, venerate the individual who bends or breaks the rules for competitive advantage as long as the profit and loss numbers work out. And we fail to talk enough about the positive aspects of being ethical in the workplace. The situation is so bad that Luigi Zingales of the University of Chicago asks point-blank if business schools incubate criminals.

New business-school accreditation guidelines adopted in April 2013 will put specific pressure on schools to describe how they address business ethics. Because business schools are accredited in staggered five-year cycles, every business school that is a member of the international accreditation agency will have to adopt ethics in its curriculum sometime over the next few years.

We hope that the work outlined in my blogposts, discussed at greater length in my articles, and laid out in our proposed book will be at the forefront of this trend to discuss business ethics and the law. We welcome those reading this blog to be a part of the development of this curriculum for our next generation of business leaders.

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January 26, 2015
The Silenced Connecticut Sex-Abuse Case
Posted by Josephine Sandler Nelson

My previous blogposts (one, two, three, four, and five) introduced why conspiracy prosecutions should be used to reach wrongdoing by agents within an organization. The 2012 prosecution of Monsignor Lynn for twelve years of transferring predator priests from parish to parish at the command and for the benefit of the Archdiocese of Philadelphia was defeated by the intracorporate conspiracy doctrine. Moreover, this was not the first time that the Roman Catholic Church had used the doctrine to help its bureaucrats escape liability for suppressing sex abuse cases.

In 1997, employees of the Roman Catholic Church in Connecticut were alleged—very much like Lynn—to have covered up the sexual misconduct of a priest, enabling him to continue to abuse children entrusted to the Church’s care by virtue of his office. When sued for civil conspiracy by the victims, the employees’ defense was that they were acting in the best interest of the corporation.

The Connecticut court found that the test for whether an agent is acting within the scope of his duties “is not the wrongful nature of the conspirators’ action but whether the wrongful conduct was performed within the scope of the conspirators’ official duties.” If the wrongful conduct was performed within the scope of the conspirators’ official duties, the effect of applying the intracorporate conspiracy doctrine is to find that there was no conspiracy. Because covering up the priest’s sex abuse was in the best interest of the corporate organization, the court found that the employees were all acting on behalf of the corporation. The court never reached the issue of whether the employees’ actions rose to the level of a civil conspiracy. Under the intracorporate conspiracy doctrine, it was a tautology that no conspiracy could be possible.

This case is interesting not only because it documents the way that the intracorporate conspiracy doctrine protects enterprises from inquiry into conspiracies, but also because of the subsequent history of its allegations. The full extent of the Bridgeport Diocese’s wrongdoings—if current public knowledge is indeed complete—only came to light in December 2009, twelve years after the 1997 case. It took twelve years, the combined resources of four major newspapers, an act displaying public condemnation of the Roman Catholic Church by members of the state legislature, and finally a decision by the U.S. Supreme Court to release the documents that could have become the basis of the intracorporate conspiracy claim in 1997. There is still no conspiracy suit or any criminal charge against the Diocese. Additional details about the case are available in my article The Intracorporate Conspiracy Trap. The article will be published soon in the Cardozo Law Review, and it is available in draft form here.

Astonishingly, none of the extensive news coverage about the sexual abuse cases in Bridgeport over those additional twelve years has connected these facts to the original 1997 case defeated by application of the intracorporate conspiracy doctrine. If the intracorporate conspiracy doctrine had not provided immunity, the case might have revealed the Diocese’s pattern of wrongdoing long beforehand and in a much more efficient way.

My next blogpost reveals additional dangers from the spread of the intracorporate conspiracy doctrine: frustration with the intracorporate conspiracy doctrine has started to distort other areas of law.

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January 21, 2015
Where are the Prosecutions for Corporate Conspiracy?
Posted by Josephine Sandler Nelson

My first and second blogposts introduced why conspiracy prosecutions are particularly important for reaching the coordinated actions of individuals when the elements of wrong-doing may be delegated among members of the group.

So where are the prosecutions for corporate conspiracy??? The Racketeer Influenced and Corrupt Organizations Act of 1970 (“RICO”, 18 U.S.C.A. §§ 1961 et seq.), no longer applies to most business organizations and their employees. In fact, business organizations working together with outside agents can form new protected “enterprises.

What’s going on here? In this area and many other parts of the law, we are witnessing the power of the intracorporate conspiracy doctrine. This doctrine provides immunity to an enterprise and its agents from conspiracy prosecution, based on the legal fiction that an enterprise and its agents are a single actor incapable of the meeting of two minds to form a conspiracy. According to the most recent American Law Reports survey, the doctrine “applies to corporations generally, including religious corporations and municipal corporations and other governmental bodies. The doctrine applies to all levels of corporate employees, including a corporation’s officers and directors and owners who are individuals.” Moreover, it now extends from antitrust throughout tort and criminal law.

What is the practical effect of this doctrine? The intracorporate conspiracy doctrine has distorted agency law and inappropriately handicaps the ability of tort and criminal law to regulate the behavior of organizations and their agents. Obedience to a principal (up to a point) should be rewarded in agency law. But the law should not immunize an agent who acts in the best interest of her employer to commit wrongdoing. Not only does the intracorporate conspiracy doctrine immunize such wrongdoing, but the more closely that an employer orders and supervises the employee’s illegal acts, the more the employer is protected from prosecution as well.

My next blogpost illustrates how the intracorporate conspiracy doctrine operates to defeat prosecutions for coordinated wrongdoing by agents within an organization. Let’s examine the case of Monsignor Lynn.

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January 20, 2015
Litigating The Financial Crisis, By Moi
Posted by David Zaring

I've written a paper on the judicial history of the financial crisis, and it's now out in the Virginia Law Review, and up on SSRN.  Here's the abstract:

The government’s response to the financial crisis was dramatic, enormous, and unprecedented, and nothing about it has been overseen by the courts. In our federal system, the courts are supposed to put the policies of presidents and congresses to the test of judicial review, to evaluate decisions by the executive to sanction individuals for wrongdoing, and to resolve disputes between private parties. But during and after the financial crisis, there has been almost none of that sort of judicial review of government, few sanctions on the private sector for conduct during the crisis, especially criminal ones, for the courts to scrutinize, and a private dispute process that, while increasingly active, has resulted in settlements, rather than trials or verdicts. This Article tells the story of the marginal role of courts in the financial crisis, evaluates the costs of that role, and provides suggestions to ensure a real, if not all-encompassing, judicial role during the next economic emergency.

Do give it a download, and let me know what you think.  And thanks in advance for supporting us around here - we do like downloads!

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J.P. Morgan’s Witness and the Holes in Corporate Criminal Law
Posted by Josephine Sandler Nelson

It is a pleasure to be guest-blogging here at The Glom for the next two weeks. My name is Josephine Nelson, and I am an advisor for the Center for Entrepreneurial Studies at Stanford’s business school. Coming from a business school, I focus on practical applications at the intersection of corporate law and criminal law. I am interested in how legal rules affect ethical decisions within business organizations. Many thanks to Dave Zaring, Gordon Smith, and the other members of The Glom for allowing me to share some work that I have been doing. For easy reading, my posts will deliberately be short and cumulative.

In this blogpost, I raise the question of what is broken in our system of rules and enforcement that allows employees within business organizations to escape prosecution for ethical misconduct.

Public frustration with the ability of white-collar criminals to escape prosecution has been boiling over. Judge Rakoff of the S.D.N.Y. penned an unusual public op-ed in which he objected that “not a single high-level executive has been successfully prosecuted in connection with the recent financial crisis.” Professor Garett’s new book documents that, between 2001 and 2012, the U.S. Department of Justice (DOJ) failed to charge any individuals at all for crimes in sixty-five percent of the 255 cases it prosecuted.

Meanwhile, the typical debate over why white-collar criminals are treated so differently than other criminal suspects misses an important dimension to this problem. Yes, the law should provide more support for whistle-blowers. Yes, we should put more resources towards regulation. But also, white-collar defense counsel makes an excellent point that there were no convictions of bankers in the financial crisis for good reason: Prosecutors have been under public pressure to bring cases against executives, but those executives must have individually committed crimes that rise to the level of a triable case.

And why don’t the actions of executives at Bank of America, Citigroup, and J.P. Morgan meet the definition of triable crimes? Let’s look at Alayne Fleischmann’s experience at J.P. Morgan. Fleischmann is the so-called “$9 Billion Witness,” the woman whose testimony was so incriminating that J.P. Morgan paid one of the largest fines in U.S. history to keep her from talking. Fleischmann, a former quality-control officer, describes a process of intimidation to approve poor-quality loans within the bank that included an “edict against e-mails, the sabotaging of the diligence process,… bullying, [and] written warnings that were ignored.” At one point, the pressure from superiors became so ridiculous that a diligence officer caved to a sales executive to approve a batch of loans while shaking his head “no” even while saying yes.

None of those actions in the workplace sounds good, but are they triable crimes??? The selling of mislabeled securities is a crime, but notice how many steps a single person would have to take to reach that standard. Could a prosecutor prove that a single manager had mislabeled those securities, bundled them together, and resold them? Management at the bank delegated onto other people elements of what would have to be proven for a crime to have taken place. So, although cumulatively a crime took place, it may be true that no single executive at the bank committed a triable crime.

How should the incentives have been different? My next blogpost will suggest the return of a traditional solution to penalizing coordinated crimes: conspiracy prosecutions for the financial crisis.

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January 14, 2015
MetLife Sues Over Its Systemically Important Designation
Posted by David Zaring

Yesterday, MetLife filed a complaint in the DDC protesting its designation as systemically important, which carries with it increased capital requirements and possibly burdensome oversight by the Fed.  Most systemically important financial institutions (or SIFIs), are banks, used to burdesome capital requirements and oversight by the Fed.  An insurance company is used to neither, hence the umbrage from MetLife.  

The lawyer is Eugene Scalia, so the complaint is naturally well-written and thoughtful.  I'm withholding judgment on the various statutory arguments posed, and on which it appears MetLife believes to have its best shot - they posit things like only financial companies can be designated as SIFIs, and financial companies must do 85% of their financial business in the US under the language of the statute, and MetLife, with its foreign insurance operations, does not do so.  That sort of statutory flyspecking doesn't usually work in financial regulation, but maybe this time it's different.

But two of the firm's longer shots are worth considering.  First, there is an effort to require the FSOC to do a cost benefit analysis in its SIFI designations, which it has steadfastly resisted so far.  MetLife argues that the committee arbitrarily "did not address MetLife’s evidence of substantial market and company-specific costs, and did not even opine on whether designating MetLife was, on balance, for good or for ill."  It is by no means clear that these considerations must be taken into account from the statute, but there are those who believe that some sort of weighing is something that every agency must do.  This sort of argument worked when the DC Circuit had fewer Obama appointees on it.

MetLife is also arguing that it has been deprived of due process by the designation.  It was "repeatedly was denied access to the full record on which FSOC’s action was based,"and anyway, "FSOC never identified the thresholds that result in SIFI designation or the manner in which the various statutory and regulatory factors regarding designation are balanced against one another in FSOC’s analysis," not least because of "the extraordinary design in the Dodd-Frank Act of FSOC itself, which identifies individual companies for designation, establishes the standards that govern the designation decision, and then sits in judgment of its own recommendations."

MetLife is right about the way that FSOC works, although the so-called "combination of functions" problems, whereby agencies both prosecute and adjudicate regulatory violations, has never been a big problem in administrative law.  It especially has never been a problem in banking regulation, where the deal is that banks give up due process rights - they can be failed at any moment by the FDIC, based on an only somewhat clearly articulated CAMELS standard - in exchange for cheap, federal insured funding by small depositors, and the possibility of a bailout if things get really bad.  MetLife doesn't get the cheap funding, but it does, as its SIFI designation suggests, get the benefit of being too big to fail, and therefore the likely recipient of a bailout.  Should the fact that insurers only get a part of the benefit of the bargain of being a financial institution mean that they should get more process rights than banks?  in some ways, that is what MetLife's constitutional claim posits.

 

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January 13, 2015
What Can We Learn From The Impending S&P Settlement?
Posted by David Zaring

The Times reports that S&P will soon be paying a billion dollar fine - or roughly one year's annual profits - to make a case that it commited fraud in relation to a financial institution go away.  What should we make of this decision to settle?

  • The government is using FIRREA to go after S&P, the obscure statute that combines harsh penalties with a civil burden of proof.  To apply, FIRREA has to be about fraud "affecting a federally insured financial institution," and that has been conceptually challenging when applied to banks who have defrauded themselves by overstating the quality of various financial products to their counterparties and in their quarterly statements (you see?  doesn't that sound like the opposite of defrauding yourself?  It sounds like fraud affecting someone doing business with an FI?), but is more easily fit into a case against S&P's allegedly fraudulent ratings of banks.
  • S&P hired Floyd Abrams, who has in the past successfully invoked the First Amendment to defend credit ratings agency rights to offer opinions about securities.  I've never really understood why this works, as no one has a First Amendment right to defraud someone.  A one billion dollar settlement doesn't suggest that the free speech at stake here is something that, you know, the Reporters' Committee for Freedom of the Press is really willing to get behind.
  • This is something of a "first principles" observation, but fraud.  Doesn't that sound like a bad word?  Fraud!  S&P is a fraud!  Intentionally deceiving someone?  Or omitting information you had a fiduciary duty to disclose?  I don't think fraud means "fraud," anymore.  I think it means something more like reckless wrongheadedness, at least in the financial markets.
  • Why settle?  The Times has a nice blurb on this:

Most Wall Street institutions, when faced with the threat of a Justice Department lawsuit, eventually cut a check rather than go to court: JPMorgan agreed to pay $13 billion to settle a crisis case;Bank of America more than $16 billion.

That settle-at-all-costs mentality stems from fears that a courtroom fight might antagonize the government and unnerve shareholders. It also spares a company the embarrassment of paying the same or even more after a trial, where an anti-Wall Street sentiment might sour the jury pool.

Financial institutions still manage to wring concessions from the government, often persuading prosecutors to water down a statement of facts that accompanies a settlement or provide immunity from other charges. And for all the leverage the government possesses, its approach has not translated into criminal charges against a single top Wall Street executive.

 

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December 11, 2014
Will The Swaps Pushout Rule Die In The Cromnibus?
Posted by David Zaring

One dodgy thing that is being included in the currently debated spending bill is a substantive provision repealing a much-hated-by-banks law requiring them to do most of their derivatives trading though an entity that is not covered by deposit insurance.  It's a rule that sounds pretty logical - why subsidize derivatives trading with deposit insurance, and isn't it risky to do otherwise?  And why do we have to address this in a government budget bill anyway?

But it is also one of uncertain policy origins.  Blanche Lincoln thought the swaps pushout rule would resonate with voters when she pushed it, and maybe community banks, which don't do a ton of this stuff, would like to make life hard for the big banks that do.  Elizabeth Warren is incensed that it might  be repealed, so maybe her constituents would be for it.  But the Fed doesn't think it does bank safety much good.

Here's Dave Weigel on the politics, which look good for the banks (Warren's concerns aside, Democrats aren't whipping for the pushout rule reversal to be defeated).  Here's DealBook on the sausage-making (the statutory language was drafted by Citigroup, which has always seemed like the most tone-deaf bank to me, rather than the most politically puissant).

My view is that financial regulation, which is just about protecting banks from themselves/macroeconomic shocks, with a soupcon of rent-seeking, is a mixture of easy rules and hard ones.  Activity restrictions, like the Volcker Rule, or anti-branching laws, are easy.  Capital rules, at least the current ones, are hard, and require a team of examiners to look over the daily positions of the banks, and so on. Admati's capital rule recommendation - banks must hold 4 times more capital than they do now, and there will be no risk-weighting - is an effort to make that easy again.

And organizational rules - create a bank holding company, make this sub do this thing, and that sub do that thing - are also easy.

Note that currently, it's the left and community banks that like the easy rules, and it's the right and the big banks that prefer to do things the hard, sophisticated way.  That doesn't mean that complex rules are weak ones - I can't judge the onerousness of our tax laws, but some of them are super-complicated responses to super-sophisticated behavior, and maybe that makes more sense than giving up and charging everyone a VAT.  But that's the way I see financial regulation right now.

And yes, I don't know why part of Dodd-Frank should be repealed as a condition of passing a spending bill.  But I admire the ability of the lobbyists to get in there and at it.

One last thing - it's risky to be the bank named as the drafter of a bill taking away some of your regulator's regulatory powers.  We'll have to see if Citi starts paying a extra-large number of fines in the next year, or if it really did do this with the tacit approval of its supervisors.

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December 08, 2014
The International Review Of The Quality Of American Financial Supervision
Posted by David Zaring

The Basel committee enforces through peer pressure, rather than through resort to a formal dispute settlement process, and the peer pressure is increasingly institutionalized through IMF-like reviews of the implementation of Basel commitments.  The US just had its review, and Basel just released the report.

The big problem with the US embrace of global rules has come through its treatment of securitizations.  Perhaps most notably:

a number of divergences were identified that for some US core banks lead to materially lower securitisation  RWA [risk-weighted assets, the stuff against which you have to hold capital] outcomes than the Basel standard. These differences are mainly related to the prohibition on the use of ratings in the US rules. Pursuant to the Dodd-Frank Act, the US rules cannot include provisions related to the Basel framework’s Ratings-Based Approach (RBA) for securitisations, so the rules provide alternative treatments.

The US is not Basel compliant because its regulators are explicitly not permitted to use a tool - credit ratings - that Basel requires.  It looks like the committee may fix this not by forcing credit ratings down America's throat, but by coming up with some equivalence standard, which tells you that when Congress speaks clearly, global regulatory harmonizers must listen.  Another admission of note:

In carrying out this review, the Committee's assessment team held discussions with senior officials and technical staff of the Federal Reserve Board, the Office of the Comptroller of the Currency, and the Federal Deposit Insurance Corporation. The team also met with a select group of US banks.

This meet with regulated industry thing is one of the features of peer regulatory review, and it presumably gives industry yet another opportunity to make a case for its preferred version of regulation.  But then, it is also a feature of international regulation, where the cross-border parties may sometimes also play roles as representatives of the domestically regulated.

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The 11 Most Influential People In Business Ethics
Posted by David Zaring

This not at all silly list reveals the following:

  • #1 William Dudley – President and CEO, Federal Reserve Bank of New York
    Category: Government and Regulatory
  • #1 Preet Bharara – US Attorney, Southern District of New York
    Category: Government and Regulatory
  • #3 Sophie Delaunay – Executive Director, Doctors Without Borders
    Category: Non-Governmental Organization
  • #4 Anonymous Whistleblower – Whistleblower, Securities and Exchange Commission
    Category: Whistleblowing and Media
  • #5 Glenn Murphy – CEO and Chairman, Gap Inc.
    Category: Business Leadership
  • #6 Eric Holder – Attorney General (outgoing), United States Government
    Category: Government and Regulatory
  • #7 José Ugaz – Chair, Transparency International
    Category: Non-Governmental Organization
  • #8 Pope Francis – Pope, Catholic Church
    Category: Thought Leadership
  • #9 Ma Jun – Director, Institute of Public and Environmental Affairs (IPE)
    Category: Design and Sustainability
  • #10 Larry Merlo – President and CEO, CVS Health
    Category: Business Leadership
  • #11 Carmen Segarra – Former Regulator, Federal Reserve Bank of New York
    Category: Whistleblowers and Media

Dudley is the regulator who has called for bankers to act more ethically.  I guess Bharara stands for the proposition that insider trading is the most unethical kind of business conduct, to the exclusion of all other such forms.  Anonymous Whistleblower at 4!  It proves you can make lots of money by being ethical!  And Carmen Segarra, the Fed examiner, rounding out the top 11  - it suggests that business ethics are in question, finance would appear not to be the answer.  Via.

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December 05, 2014
CEO Health Disclosures: JPMorgan Edition
Posted by David Zaring

Not to pile on, but there's the slightly unsettling trned of CEOs talking, or not, about their health.  Surely material information a real investor would want to know about when deciding whether to buy or sell a stock in these days of the imperial CEO.  But deeply unprivate.  Anyway, here's Jamie Dimon's letter to the staff, in part, on the very good news that, after been stricken with throat cancer, he now appears to be free of it.

Subject: Sharing Some Good News
Dear Colleagues -

This past summer, I let you know that I had been diagnosed with throat cancer. Having concluded my full treatment regimen a few months ago, I wanted to give you an update on my health. This week I had the thorough round of tests and scans that are normally done three months following treatment, including a CAT scan and a PET scan. The good news is that the results came back completely clear, showing no evidence of cancer in my body. While the monitoring will continue for several years, the results are extremely positive and my prognosis remains excellent.

The stock is up 2% on the day.  It will be interesting to see whether this email makes its way into a securities filing.

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