Tuesday, 23 September 2014
Last updated 2 hours ago
Oct 26 2010 | 3:24am ET
Investors in a trio of collateralized debt obligations have filed a lawsuit against Crédit Agricole that reads an awful lot like the Securities and Exchange Commission's fraud case against Goldman Sachs.
The complaint was filed by the Loreley Companies, four Channel Islands investment companies set up by IKB Deutsche Industriebank to invest in asset-backed securities. According to the lawsuit, Crédit Agricole Corporate and Investment Bank allowed hedge fund Magnetar Capital to pick the subprime assets that made up the CDO, as Goldman was alleged to have allowed Paulson & Co. and hand in selecting the assets in its litigated CDO. And as with Paulson in the Goldman suit, Magnetar then shorted the CDOs, with the Loreley Companies none the wiser about its role.
Neither Paulson nor Magnetar have been charged with any wrongdoing in the cases.
IKB, the Loreley Companies' investment adviser, was one of the biggest losers in the Goldman Sachs CDO.
The four companies add that Crédit Agricole set up a third CDO on its own to dump "its unwanted, poor-quality assets" into before abandoning its CDO business "virtually overnight."
The lawsuit, filed in New York federal court, says the Loreley Companies invested US$70.5 million in the three CDOs. Crédit Agricole said the lawsuit was a "counter-action by IKB" in response to its own litigation against the German bank in the U.K. The French bank said the U.S. lawsuit was "without merit."
Sep 22 2014 | 4:15pm ET
"I tell people that everybody likes good news and so if you have good performance that’s wonderful,” explains Mike McKitich, CIO of Petty Endowment, “but it’s the people that want to talk about the bad news or where they drifted and how they came back and how they stayed to their discipline…” that he wants to hear from. Read more…
Aug 25 2014 | 11:21am ET
As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…
Credit default swaps brought down the London Whale and cost JPMorgan $6.2 billion. Here is how it happened.