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☆ Enron Short Seller Lists Miami Beach Condo for $21 Million
▼ + stars: | 2023-05-27 | by ( Katherine Clarke | ) www.wsj.com time to read: 1 min

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☆ Credit ratings agencies like Moody's decide the US credit rating. Here's what you need to know
▼ + stars: | 2023-05-27 | by ( Samantha Delouya | ) edition.cnn.com time to read: +4 min

CNN —Credit rating agencies are once again in the spotlight amid the ongoing high-stakes debt ceiling negotiations in Washington. What is the purpose of credit rating agencies? Put simply, credit rating agencies provide their opinions and issue a score evaluating the likelihood that a borrower will repay its debt. Rating agencies first rose to prominence over a century ago, but today, the three major agencies dominate the market. Bonsall has studied the effectiveness of credit rating agencies and their possible conflicts of interest.

☆ Central bankers face a balance sheet reckoning
▼ + stars: | 2023-05-26 | by ( Edward Chancellor | ) www.reuters.com time to read: +7 min

LONDON, May 26 (Reuters Breakingviews) - Central banks’ balance sheets have exploded in size since 2008. That’s not a problem, we’re told, since central banks are not bound by ordinary accounting rules. Ferguson and his colleagues examined fourteen central bank balance sheets over a period of 400 years. Central bank hawks on the other hand, are typically slow to expand their balance sheets during crises. Central banks with weak balance sheets are less credible bastions of a fiat currency.

☆ EY calls off plan to split audit, consulting units
▼ + stars: | 2023-04-11 | by ( ) www.reuters.com time to read: +1 min

April 11 (Reuters) - Accounting firm EY has called off a plan to break up its audit and consulting units, slamming the brakes on a proposed overhaul of its businesses that was meant to address regulatory concerns over potential conflicts of interest. But the plan, code-named "Project Everest", faced resistance from some of EY's partners. The company said its U.S. Executive Committee decided not to move forward with the split. UK auditing and accounting regulator, the Financial Reporting Council, had asked the Big Four firms in 2020 to separate auditing as a standalone business in Britain by June 2024. Reporting by Niket Nishant in Bengaluru; Editing by Devika Syamnath and Shinjini Ganguli and Anil D'SilvaOur Standards: The Thomson Reuters Trust Principles.

☆ Accounting-Fraud Indicator Signals Coming Economic Trouble
▼ + stars: | 2023-03-24 | by ( Josh Zumbrun | ) www.wsj.com time to read: 1 min

The M-Score determines whether a company is engaging in earnings manipulation. Manipulation of earnings from Corporate America is on the rise, an ominous omen for the U.S. economy. That is the conclusion of new research on accounting fraud, using a technique that flagged Enron as an earnings manipulator several years before the energy company’s spectacular 2001 implosion.

☆ Why Blackouts, Power Outages Are Becoming More Common
▼ + stars: | 2023-03-23 | by ( Taylor Dorrell | ) www.businessinsider.com time to read: +14 min

Power outages have increased 64% from the early 2000s, and weather-related outages — many driven by the worsening climate crisis — have increased 78%. A record-breaking blizzard in Buffalo, New York, this winter caused power outages throughout the city, resulting in the deaths of 47 residents. In 2021, a heat wave led to power outages and the deaths of hundreds in the Pacific Northwest. While regional organizations might use fees to penalize companies for power outages, it's now much harder to pinpoint and hold a person or entity responsible. In the meantime, the climate crisis will continue to wreak havoc on an aging grid system that puts profits over reliability.

☆ 'Big Short' investor Michael Burry brushes off the latest US banking crisis: 'I am not seeing true danger here'
▼ + stars: | 2023-03-14 | by ( Morgan Chittum | ) www.businessinsider.com time to read: +2 min

Michael Burry is not seeing "true danger" from the collapse of Silicon Valley Bank. The fund manager, who called the 2008 housing crash, expects the fiasco to "resolve very quickly"Sign up for our newsletter to get the inside scoop on what traders are talking about — delivered daily to your inbox. Michael Burry, the legendary investor who called the 2008 housing market crash, dismissed concerns around the financial turmoil caused by Silicon Valley Bank's demise. Burry's latest remarks came a day after comparing SVB's collapse to the great financial crisis and dot-com crash. Meanwhile, Burry last week compared SVB to Enron, the energy-trading giant that was busted for accounting fraud and went bankrupt in 2001.

☆ Bernie Sanders says Silicon Valley Bank's failure is the 'direct result' of a Trump-era bank regulation policy
▼ + stars: | 2023-03-13 | by ( Cheryl Teh | ) www.businessinsider.com time to read: +4 min

Sen. Bernie Sanders is blaming a Trump-era policy for the Silicon Valley Bank run. "Now is not the time for US taxpayers to bail out Silicon Valley Bank. The Federal Deposit Insurance Corporation shut down the Silicon Valley Bank on Friday following a catastrophic bank run. The collapse of Silicon Valley Bank has now become the largest bank failure in the US since the 2008 financial crisis. However, startups with money in Silicon Valley Bank exceeding $250,000 are now in danger of not being able to make payroll next week.

☆ Cratering Silicon Valley Bank's troubles could be the first sign of a new financial crisis. Here's what Burry, Ackman and El-Erian have to say.
▼ + stars: | 2023-03-10 | by ( Zinya Salfiti | ) www.businessinsider.com time to read: +3 min

Cratering Silicon Valley Bank's troubles could be the first sign of a new financial crisis. While some say the US banking system is solid, others think this could be the first sign of a new financial crisis. Well, and highlighting the current economic/financial/policy fluidity, we have something: banking system worries," El-Erian said on Twitter. Silicon Valley Bank going under would be exponentially worse. Activist Investor Ryan Cohen"Does this mean I don't have to pay back Silicon Valley Bank?"

☆ The implosion of Silicon Valley's largest bank has investors worried worse is to come: 'There might be some kind of crack in the financial system'
▼ + stars: | 2023-03-10 | by ( Hasan Chowdhury | James Dean | ) www.businessinsider.com time to read: +5 min

The implosion of the California lenders Silicon Valley Bank and Silvergate has investors worried. Christopher Whalen, the chairman of Whalen Global Advisors, a financial consultancy, said Silicon Valley Bank was "just the tip of the iceberg." He added that the situation at Silicon Valley Bank was "a reminder that many institutions are sitting on large unrealized losses" on bond holdings. Mould said the "fire sale" of Silicon Valley Bank's bond portfolio raised broader concerns. Silicon Valley Bank CEO Greg Becker on Thursday implored customers to "stay calm" in an apparent bid to stave off further mass withdrawals and avert collapse.

☆ Silicon Valley Bank crisis: Everything you need to know about SVB Financial as its share collapse rattles major stocks
▼ + stars: | 2023-03-10 | by ( George Glover | ) www.businessinsider.com time to read: +5 min

SVB Financial's share plunge is dragging on major bank stocks like JPMorgan and Bank of America. Here's everything you need to know about Silicon Valley Bank and its parent company SVB Financial. SVB is a Santa Clara-based bank that lends money to and takes deposits from Silicon Valley tech startups. Why has SVB's stock price crashed? "The failure of SVB Financial could destroy an important long-term driver of the economy as VC-backed companies rely on SVB for loans and holding their operating cash," he said on Twitter Thursday evening.

☆ 'Big Short' investor Michael Burry issues a grave warning after Silicon Valley Bank's stock rout: 'It is possible today we found our Enron'
▼ + stars: | 2023-03-10 | by ( George Glover | ) www.businessinsider.com time to read: +3 min

'Big Short' legend Michael Burry just compared Silicon Valley Bank to Enron. The bank's stock plunged 60% Thursday as its parent company offloaded shares after massive bond losses. "It is possible today we found our Enron," the 'Big Short' investor said Thursday in a now-deleted Tweet, referencing the scandal-hit energy firm that collapsed during the early 2000s. Enron collapsed as the dot-com bubble burst in the early 2000s, with the tech-heavy Nasdaq Composite index plunging 78% in just over two years. The bank's updated investor deck, which was filed Wednesday, showed that the company's $21 billion bond portfolio had a yield of 1.8% and an average duration of just over three years.

☆ Binance continues to get more popular with Sam Bankman-Fried's FTX out of the picture, despite increased regulatory scrutiny
▼ + stars: | 2023-03-08 | by ( Phil Rosen | ) www.businessinsider.com time to read: +2 min

Binance is extending its dominance in crypto trading since FTX collapsed in November. Its market share grew to 61.8% in February from 59.4% in January, CryptoCompare data showed. According to data from CryptoCompare cited by CoinDesk, Binance increased its market share for the fourth consecutive month in February, growing to 61.8% from 59.4% in January. Coinbase was a distant second with trading volume of $39.9 billion, down 29% from the prior month, and Kraken was third with $19.3 billion, down 11%. Meanwhile, former rival exchange FTX continues to wade through bankruptcy procedures and is effectively out of the picture as far as competition.

☆ FTX's lawyers and advisers cost $38 million for a month of work - and the bankrupt crypto exchange's new CEO charged $305,000 for February
▼ + stars: | 2023-03-07 | by ( Phil Rosen | ) www.businessinsider.com time to read: +2 min

The army of professionals working with FTX billed $38 million in expenses for January. FTX CEO John Ray III submitted a bill for $305,565 for the month of February. Those three firms have over 180 lawyers and over 50 other staffers working on the FTX case, per the CoinDesk report. Sullivan & Cromwell billed 14,569 hours of work in January for a total of $16.8 million. Meanwhile, FTX's trading arm sued Grayscale this week in a bid to claw back $250 million to repay customers.

☆ An Elon Musk documentary is in the works from the director who examined Theranos, Enron, and Scientology
▼ + stars: | 2023-03-06 | by ( Sarah Jackson | ) www.businessinsider.com time to read: +1 min

An Elon Musk documentary is currently being made by acclaimed director Alex Gibney. Gibney has examined Theranos, Enron, Scientology, and more in his previous documentaries. Gibney's other documentaries have tackled Scientology, Enron, Theranos founder Elizabeth Holmes, WikiLeaks, Steve Jobs, and more. Gibney's Jigsaw Productions is producing the film alongside production companies Closer Media, Anonymous Content, and Double Agent. "Now is the moment for a rigorous portrait of Elon Musk, who is undeniably one of the most influential figures of our time.

☆ Resilient stock market finds support at just the right time, preserving uptrend
▼ + stars: | 2023-03-04 | by ( Michael Santoli | ) www.cnbc.com time to read: +7 min

Did the "soft landing" occur six months ago, at least in market terms? The leadership profile speaks, perhaps, to an elongated economic and Fed tightening cycle and suggests where within a notably bifurcated market investors should migrate. For one thing, the stock market surely can be prone to misapprehending the next macro turn and can overshoot reality in the short term. BCA Research here shows the sobering harmony in the current market trajectory and that of the early-2000s post-tech-bubble bear market. We can note, though, that the S & P 500 back then never spent as much as a month above its 200-day moving average as it has this year.

☆ Exclusive: Trump lawyer hires own attorney in classified documents probe
▼ + stars: | 2023-02-17 | by ( Andrew Goudsward | ) www.reuters.com time to read: +2 min

Levy was hired by Corcoran's law firm, Silverman Thompson Slutkin & White, to represent Corcoran in the probe, according to one of the people. Levy, a principal at the Washington law firm Ellerman Enzinna Levy, declined to comment. Corcoran has appeared before a grand jury in connection with U.S. Special Counsel Jack Smith's investigation into classified documents taken to Mar-a-Lago following Trump's term in office and possible attempts to obstruct that probe. Another Trump lawyer, Christina Bobb, signed a certification that all classified documents had been returned before the FBI found about 100 additional classified documents during an August 2022 search, according to prosecutors. Trump has denied wrongdoing and claimed, without offering evidence, that all documents at his residence had been declassified.

☆ The massive selloff in Adani shares eclipses those of other short-seller targets like Enron and Wirecard
▼ + stars: | 2023-02-07 | by ( Huileng Tan | ) www.businessinsider.com time to read: +4 min

Adani Group companies have lost over $110 billion in market value in the past fortnight. These losses eclipse those at other short seller targets like Enron and Wirecard. Enron lost more than $65 billion between August 2000 and December 2001 when it filed for Chapter 11 bankruptcy, per Bloomberg's record. In Wirecard's case, it was short seller Fraser Perring, who in a 2016 report, accused the payments firm of money laundering and fraud. Shares of Adani Transmission, Adani Green Energy, and Adani Power were also up.

☆ FTX's new boss says security was so weak that founders could 'download half a billion dollars' of crypto without detection, report says
▼ + stars: | 2023-02-07 | by ( Pete Syme | ) www.businessinsider.com time to read: +3 min

John J. Ray III, the current FTX CEO, berated the crypto exchange's security. He told a Monday court hearing that an exec could download $500m of crypto and walk away unchecked. FTX filed for bankruptcy on November 11, weeks after its then-CEO Sam Bankman-Fried insulted rival crypto CEO Changpeng Zhao. Hours after the exchange filed for bankruptcy, more than $370 million of crypto disappeared from FTX. Ray also described a "massive scramble for information" as liquidators looked to secure customers' passwords and crypto wallets.

The U.S. Department of Justice's bankruptcy watchdog has urged U.S. Bankruptcy Judge John Dorsey, who is overseeing FTX's Chapter 11, to appoint an independent examiner to investigate allegations of "fraud, dishonesty, incompetence, misconduct, and mismanagement" that are "too important to be left to an internal investigation." FTX says an examiner would merely duplicate work already being done by FTX, its creditors, and law enforcement agencies. FTX's founder Sam Bankman-Fried, who has been accused of stealing billions of dollars from FTX customers to pay debts incurred by his Alameda Research hedge fund, has pleaded not guilty to fraud charges. FTX's official creditors committee has sided with FTX, saying the proposed investigation is redundant. State securities regulators in Texas, Vermont and Wisconsin supported the Justice Department's bid, saying a neutral report would benefit creditors and customers.

☆ It's time to chill with al the recession talk
▼ + stars: | 2023-02-06 | by ( Allison Morrow | ) edition.cnn.com time to read: +8 min

New York CNN —In 2021, a bunch of economists and policy makers underestimated the inflation that was taking root around the world. In 2022, as inflation hit 40-year-highs and the Fed ramped up interest rates, many of those commentators went full-on gloomy — predicting a recession was all but inevitable. And that makes it hard, if not impossible, to imagine a recession anytime soon. “Any concern the economy is in recession or close to a recession should be completely dashed by these numbers,” Moody’s Analytics chief economist Mark Zandi told CNN on Friday. “The economy is further away from recession than ever,” wrote Christopher Rupkey, chief economist at Fwdbonds.

☆ A shortage of accountants is pushing the industry to reboot its image to win over young talent: 'You have to sell them'
▼ + stars: | 2023-02-02 | by ( Erica Sweeney | ) www.businessinsider.com time to read: +9 min

Accountants manage financial processes and financial reporting and ensure regulatory compliance. To combat shortages, those in the accounting industry are working to attract more people to the field. Sandy Torchia, the vice chair of talent and culture at KPMG, said the company hasn't been impacted by the accountant shortage yet. How the accounting industry is addressing the shortageMany firms are shifting to remote-work policies and investing in automation and technology to attract and retain talent. Lisa Simpson says the accounting industry needs automation to allow accountants to focus on "higher-value work."

☆ Fraud Economy: How Current Economic Trends Lead to More Corporate Scams
▼ + stars: | 2023-01-31 | by ( Linette Lopez | ) www.businessinsider.com time to read: +12 min

Get ready for what will feel like an inescapable wave of corporate fraud. And as interest rates have risen, the stock market has fallen off — which makes it harder to get dollars by whipping up new investors or offering stock. Despite Scheck's assertion that the risk of a wave of corporate fraud has heightened, he didn't want to speak in historical analogies. There be icebergsOf course, there's also fraud that goes undetected in times of easy money — companies where the very act of existing means stretching the truth. Kreuger had managed to hide that he had stretched the company's finances beyond solvency by raising money on the US stock market while it was raging.

☆ Great Fraud Reckoning Will Expose Scam Companies, Cause Stock Market Chaos
▼ + stars: | 2023-01-31 | by ( Linette Lopez | ) www.businessinsider.com time to read: +12 min

Get ready for what will feel like an inescapable wave of corporate fraud. And as interest rates have risen, the stock market has fallen off — which makes it harder to get dollars by whipping up new investors or offering stock. Despite Scheck's assertion that the risk of a wave of corporate fraud has heightened, he didn't want to speak in historical analogies. Kreuger had managed to hide that he had stretched the company's finances beyond solvency by raising money on the US stock market while it was raging. That may have been enough when the stock market was on a heater and investors were winning, but it's not enough when the stock market is falling, the economy is slowing, and everyone from regulators to lawmakers to kids on TikTok want answers.

☆ Celsius bankruptcy examiner expected to report on Ponzi allegations
▼ + stars: | 2023-01-30 | by ( Dietrich Knauth | ) www.reuters.com time to read: +3 min

Jan 30 (Reuters) - A court-ordered examiner is expected to release a report on Monday addressing whether bankrupt crypto firm Celsius Network operated as a Ponzi scheme, which could add to the pressure on founder Alex Mashinsky, who is already facing fraud allegations. Hoboken, New Jersey-based Celsius filed for Chapter 11 protection from creditors last July in Manhattan after freezing customer withdrawals from its platform. After appointing Pillay to the job, Glenn expanded her role by asking her to address persistent customer complaints about Mashinsky's conduct. Crypto exchange FTX, which went bankrupt in November, has resisted calls for an examiner in its own Chapter 11 case, citing the cost of overlapping investigations. Pillay and her team have sought to be paid $1.86 million for work performed in October and $1.69 million for November, according to court filings.

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