A NOTEPAD ON COMPANY AND FINANCIAL LAW, NEWS AND REGULATION
Gloster J didn’t make much of Mr Berezovsky:
“On my analysis of the entirety of the evidence, I found Mr. Berezovsky an unimpressive, and inherently unreliable, witness, who regarded truth as a transitory, flexible concept, which could be moulded to suit his current purposes. At times the evidence which he gave was deliberately dishonest; sometimes he was clearly making his evidence up as he went along
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The Financial Times reports today that the Government is considering reducing the free float requirement for tech companies listing on London from the current 25% to 10%, with the aim of trying to increase the attractiveness of London for tech IPOs. Bloomberg carried a similar report earlier this week. The FT report suggests that consultation on such a rule change would be wrapped into the current FSA review of the Listing Rules (which we discuss here).
See also: FTSE sets minimum 25% free float requirement for inclusion in UK indices
Lucy Kellaway in the FT on the wisdom of Helen Gurley Brown.
We also liked “Never fail to know that if you are doing all the talking, you are boring somebody.”
Matt Taibbi on Mitt Romney in Rolling Stone magazine.
He’s a not a fan of the Republican party nominee:
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Tom Crone, former Head of Legal at the News of the World, has been arrested as part of the police investigation into phone hacking.
Mr Crone is the author of the book “Law and the Media“, described on Amazon as “providing an essential source of reference for the key legal issues encountered by those who work in the media such as journalists, editors and producers, as well as media lawyers”.
Following speculation this afternoon, Barclays has confirmed that the Serious Fraud Office is investigating payments made to the Qatari sovereign wealth fund in connection with the bank’s 2008 capital raising. Here’s the Barclays RNS statement of this evening in full:
“Barclays confirms that the Serious Fraud Office has commenced an investigation into payments under certain commercial agreements between Barclays and Qatar Holding LLC.”
On 14 August 2012 Barclays first made public the interest of the Financial Services Authority in these payments, as we reported here. It appears that the FSA has now handed the investigation over to the criminal authorities.
Mario Draghi’s article today in Die Zeit on “The future of Euro: stability through change” has been published by the European Central Bank. Excerpt:
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In 14 August 2012 we highligthed the disclosure in Barclays interim results that the FSA is investigating “the sufficiency of disclosure in relation to fees payable under certain commercial agreements and whether these may have related to Barclays capital raisings in June and November 2008″.
“U.K. fraud prosecutors may open a criminal probe as soon as this week into payments Barclays Plc (BARC) made in 2008 to Qatar’s sovereign wealth fund as the bank sought to raise money, according to two people familiar with the case.
The Serious Fraud Office, which prosecutes bribery and white collar crime, may inform the London-based bank about its decision on a probe this week, according to the people, who declined to be identified because the discussions are private. Prosecutors are working with the U.K. Financial Services Authority, Britain’s finance regulator, which is conducting a civil investigation into whether the bank adequately disclosed fees it agreed to pay the Qatar Investment Authority”.
See also: Barclays LIBOR travails
Squire Sanders have produced a fantastically downbeat note on everything that could go wrong. It’s here, if you’re in the mood.
A good article by Gary Parkinson of The Times on how the LSE’s ORB offers a potential new revenue stream for the fixed income desks of hard-pressed smaller brokers.
See also: The Order book for Retail Bonds: A growing number of issuers in 2011
Sheryl Sandberg, chief operating officer of Facebook, is the cousin of hedge fund investor – and FSA finee – David Einhorn.
This long and mostly admiring article about David Einhorn in the New York Times doesn’t even make mention Einhorn’s £7.2 million fine from the FSA for market abuse; quickly forgotten in the US, if ever of interest.
“Some days I didn’t do any work at all, I just larked around. It could be said that I had a bad attitude, in fact it probably has to be said that I had a bad attitude. All I’ve ever wanted from a job is to skive. Skiving is a whole way of approaching – in the sense of avoiding – work. It’s not the same as slacking, because skiving can involve a far greater involvement of energy and initiative than doing the work could have ever have necessitated. Get in late, knock off early and do fuck-all in the interval except steal stationery: that’s my attitude to work…After about a month I was called into the deputy-boss’s office and sacked…Although I felt pretty bad about being sacked I realised that it was not for me, this world of work, that I was too selfish to do a job, that I actually valued my time – my life – so highly that I would rather waste it than work at a job.”
From “Sacked” in Working the Room.
Goals Soccer Centres plc - the subject of a recommended takeover offer from a newco formed by the Ontario Teachers’ Pension Plan Board – has lost the shareholder vote held at the court meeting to approve the takeover.
Losing a shareholder vote on a recommended takeover effected by scheme of arrangement is very rare; we can’t remember the last time it happened.
Goals Soccer Centres’ announcement is here. The bidder now cannot return for 12 months, or 6 months with the approval of the GSC board and the Takeover Panel (Rule 35 of the Takeover Code).
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Asil Nadir has today been found guilty of 10 counts of theft. The SFO press release gives a comprehensive account of the Polly Peck background, the prosecution case and the 22 year investigation. Mr Nadir will be sentenced tomorrow.
UPDATE 23 August 2012: Mr Nadir has been jailed for 10 years – ITV News.
See also: SFO drops disastrous Tchenguiz investigation
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From the New York Review of Books, June 2012.
“Today, however, Chatwin’s fictions seem more transparent. We may not be too surprised to discover the journeys with nomads for which he “quit his job,” and which John Lanchester admired, were brief interludes in a period more accurately described as Chatwin getting married and becoming an undergraduate at Edinburgh University.
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FSA press release here and consultation paper here. The consultation closes on 14 November 2012. From the press release:
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Here.
“Sometimes life hits you in the head with a brick. Don’t lose faith. I’m convinced that the only thing that kept me going was that I loved what I did. You’ve got to find what you love. And that is as true for your work as it is for your lovers. Your work is going to fill a large part of your life, and the only way to be truly satisfied is to do what you believe is great work.
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The Treasury Select Committee’s preliminary findings on the LIBOR fixing scandal were released on 18 August 2012. The preliminary report can be read here and the accompanying press release is here.
From the “conclusion and recommendations” of the preliminary report:
On the need for widening the market abuse and criminal regimes to catch benchmark manipulation:
“The Committee urges the Wheatley review to consider the case for amending the present law by widening the meaning of market abuse to include the manipulation, or attempted manipulation, of the LIBOR rate and other survey rates. They should also consider the case for widening the definition of the criminal offence in section 397 of FSMA to include a course of conduct which involves the intention or reckless manipulation of LIBOR and other survey rates.”
On the Financial Services Authority’s shortcomings:
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HM Treasury launched a consultation on resolving stability-threatening problems in the non-bank financial sector on 1 August 2012. The press release is here and the consultation document is here. From the press release:
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The GC100 group has issued a strongly supportive response to the Ministry of Justice’s consultation on Deferred Prosecution Agreements. The Corporate Crime and Corruption Committee of the City of London Law Society has responded here.
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From Kennedy’s, short and sensible advice on how employees and employers can dealing with “changes brought on by the rise of social media”.
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In July 2010 the Takeover Appeal Board confirmed the Takeover Panel’s three year ”cold-shouldering” of Brian Myerson, Brian Padgett and Daniel Posen. This, only the second “cold-shoulder” in 40 years, triggered MAR 4.3 (Support of the Takeover Panel’s Functions) of the FSA Handbook, which requires that FSA-authorised firms:
“must not act, or continue to act, for any person in connection with a transaction to which the Code applies if the firm has reasonable grounds for believing that the person in question, or his principal, is not complying or is not likely to comply with the Code”.
The effect is that no authorised firm can act for the three individuals on any transaction falling within the Code.
Without any comment or explanation, this reminder appeared on the FSA website on 31 July 2012:
“On 31 July 2012, the Market Monitoring department sent a reminder to all FSA authorised firms setting out key elements of the ‘cold-shouldering’ requirement imposed by the Panel on Takeovers and Mergers in respect of Brian Myerson, Brian Padgett and Daniel Posen in 2010.”
One can only guess at the reason for the reminder…
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As part of its “Journey to the FCA” webpage, the Financial Services Authority has published a set of frequently asked questions for authorised firms on the transition from the FSA to the new conduct and markets regulator.
The FSA promises an “approach document” in October 2012 on how the FCA will work.
See also: Tracey McDermott becomes head of FSA’s Enforcement and Financial Crime Division – The Daily Telegraph, July 2012
How conduct supervision will work under the Financial Conduct Authority
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From efinancialnews.com via Nasdaq:
“One of the world’s largest investors is threatening to boycott any stock market listing that allows minority shareholders to control a majority of the votes through multi-tier share structures and will oppose those that already exist…
…The California Public Employees’ Retirement System, the US’s largest pension fund with $237 billion in assets under management, is drawing up new corporate governance criteria under which it will campaign to remove dual class, classified or plurality voting structures and not invest in initial public offerings which use them.”
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The UK introduced a temporary short selling regime in 2008, placing it on a permanent footing in 2009 and 2010 through rules now contained in Chapter 2 of the FINMAR module of the FSA Handbook. That regime requires the public disclosure of net short positions of 0.25% or above of the issued equity of selected UK financial stocks and UK stocks undertaking rights issues.
The UK regime will be abolished on 1 November 2012 when the EU Short Selling Regulation (EU No 236/2012) comes into effect. The Regulation is directly applicable in the UK and requires no further domestic implementation. The Regulation requires that:
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ICSA has updated (dated June 2012, published July 2012) its guidance note on the induction of directors. The updated guidance can be read here. The introduction to the guidance says that:
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“Can accountants save the world?” asks the Institute of Chartered Accountants in England and Wales.
In its annual results yesterday, Resolution Limited (the Guernsey-incorporated, London-listed “financial services restructuring company”) announced that it is ending the arrangements by which it outsources its management to an external company, Resolution Operations LLP:
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HM Treasury published on 10 August 2012 an initial discussion paper to support the review of LIBOR by Martin Wheatley, chief executive-designate of the Financial Conduct Authority. The discussion paper follows the Treasury’s setting of the Wheatley Review’s Terms of Reference on 30 July 2012.
The discussion paper is here. Accompanying press releases are here and here. A speech by Martin Wheatley given on the same date is here; in that speech, Mr Wheatley set out the scope of his review:
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The regulator has spoken. From its new page on crowdfunding:
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From yesterday’s announcement by the Accountancy and Actuarial Discipline Board into PwC’s role in RSM Tenon Group plc’s accounting problems:
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“A Transactional Genealogy of Scandal: from Michael Milken to Enron to Goldman Sachs”* (downloadable here) looks at how the “integration of SPEs into regulatory systems requires a ground-up rethinking of traditional legal models of the firm”.
From the abstract:
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A fascinating slide deck here by the Head of New Media at London 2012 on how they built and designed, and we used, the London2012.com website and related new media.
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A rather grim article from the Economist on the difficulties that face entrepreneurs, particularly start-ups, in Europe. The accompanying editorial contains the amazing statistic that:
“Since 1975 the countries now in the euro zone have given birth to just one company currently among the world’s 500 biggest…by contrast California alone has created 26.”
Globalisation, alternative legal service providers, virtual law firms, legal process outsourcing – good graphic from the Wall Street Journal:
The new lawyer graphic – WSJ Law blog
