BoE stress tests: all you need to know

The Bank of England has released the results of its latest round of its annual banking stress tests and its semi-annual financial stability report this morning. Used to measure the resilience of a bank’s balance sheet in adverse scenarios, the stress tests measured the impact of a severe slowdown in Chinese growth, a global recession […]

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Draghi: Eurozone will decline without vital productivity growth

It’s productivity, stupid. European Central Bank president Mario Draghi has become the latest major policymaker to warn of the long-term economic damage posed by chronically low productivity growth, as he urged eurozone governments to take action to lift growth and stoke innovation. Speaking in Madrid on Wednesday, Mr Draghi noted that productivity rises in the […]

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Asia markets tentative ahead of Opec meeting

Wednesday 2.30am GMT Overview Markets across Asia were treading cautiously on Wednesday, following mild overnight gains for Wall Street, a weakening of the US dollar and as investors turned their attention to a meeting between Opec members later today. What to watch Oil prices are in focus ahead of Wednesday’s Opec meeting in Vienna. The […]

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Banks, Financial

RBS emerges as biggest failure in tough UK bank stress tests

Royal Bank of Scotland has emerged as the biggest failure in the UK’s annual stress tests, forcing the state-controlled lender to present regulators with a new plan to bolster its capital position by at least £2bn. Barclays and Standard Chartered also failed to meet some of their minimum hurdles in the toughest stress scenario ever […]

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Barclays: life in the old dog yet

Barclays, a former basket case of British banking, is beginning to look inspiringly mediocre. The bank has failed Bank of England stress tests less resoundingly than Royal Bank of Scotland. Investors believe its assets are worth only 10 per cent less than their book value, judging from the share price. Although Barclays’s legal team have […]

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Categorized | Banks

US Supreme Court rebuffs Madoff trustee

Posted on June 30, 2014

Financier Bernard Madoff passes the gathered press as he arrives at Manhattan Federal court on March 12 2009 in New York City. Madoff was expected to plead guilty to all 11 felony charges brought by prosecutors on financial misdoings, and could end up with a sentence of 150 years in prison. (Photo by Chris Hondros/Getty Images)©Getty

Bernard Madoff arriving at Manhattan Federal court in March 2009

The US Supreme Court has sheltered HSBC, UniCredit and UBS from facing more than $10bn in legal claims stemming from the Bernard Madoff Ponzi scheme.

The court rejected without comment an appeal from Irving Picard, the trustee liquidating Madoff’s securities firm, in the latest twist of the lengthy legal proceedings aimed at recovering billions of dollars in customer losses.

    The decision upholds a lower US court ruling that rejected Mr Picard’s right to sue the banks for allegedly helping to facilitate the fraud on the grounds that the trustee lacked the standing to assert the common law claims.

    Mr Picard had argued that the fraud could not have persisted for so long without “a network of financial institutions, feeder funds and individuals who participated in his fraud or acquiesced in it – just like any large-scale financial fraud.”

    Amanda Remus, spokeswoman for the liquidators, said Mr Picard respected Monday’s ruling and is still pursuing $3.5bn in bankruptcy claims against these financial institutions.

    The trustee is also appealing a separate court case in hopes of resurrecting racketeering claims potentially worth tens of billions of dollars against UniCredit.

    HSBC declined to comment while UniCredit did not immediately respond to requests for comment. “We are pleased that the Supreme Court allowed the decision of the Second Circuit to stand,” UBS said.

    Investors lost $17bn when Madoff’s scheme unravelled at the height of the financial crisis. The former chairman of the Nasdaq stock market, his clients ranged from individuals to big hedge funds. He pleaded guilty to fraud in 2009 and was sentenced to 150 years in prison and in March, five former lieutenants were found guilty of helping carry out and cover up the largest investment fraud in US history.

    Mr Picard, who is acting as trustee on behalf of the Securities Investor Protection Corporation, has recovered $9.8bn in settlements and distributed $4.3bn to customers as part of the liquidation process so far.

    Separately, the court on Monday also rejected a request to hear an appeal from victims of the $7bn Ponzi scheme of financier and cricket mogul Allen Stanford.