Deals wrap: VCs think IPO activity low
More than 80 percent of venture capitalists believe the initial public offering market is at very weak levels and it is curbing profits, according to a new survey.
Online video site Hulu has been approached by a potential buyer and is weighing whether to sell itself, according to a person familiar with the matter. GigaOM lists the possible candidates and the merits of a deal for each company.
Taiwan regulators rejected Kohlberg Kravis Roberts & Co’s $1.6 billion joint management buyout of electronics component maker Yageo Corp, a decision that may cast a shadow over other private equity involvement in the island.
Hedge fund managers are sifting through the rubble of the deepening Greek debt crisis to find money-making opportunities, though political uncertainty makes it a risky business.
Bridgewater Associates, the world’s biggest hedge fund, is close to launching a $10 billion fund, the Wall Street Journal reports.
The best trader in the world worked for Bernie Madoff, writes The Altucher Confidential.
The afternoon deal: Hard rock, hard time
Hot news items today include the Teva deal, MGM Mirage’s move out of Atlantic City and a possible Siemens spin off. But the limelight shines elsewhere, on a hard rocking Buffet and inmate number No. 61727-054.
Warren Buffett Rocks Out (NYT) “The Oracle of Omaha made a guest appearance in a music video produced by employees of Geico, the insurer he owns through Berkshire Hathaway.”
Madoff Beaten in Prison (WSJ) “Mr. Madoff was treated for a broken nose, fractured ribs and cuts to his head and face, according to a felon currently at Butner serving time on drug charges who was familiar with his condition at the time.” The 20 Hot New York City Startups You Need To Watch (Business Insider)
Grisham says real-life swindlers outdo his fiction
(Reporting by Ned Barnett in Chapel Hill, N.C.)
Author John Grisham, master of the legal thriller, says the real-life fraud scandals involving Bernard Madoff and Allen Stanford trump even the gripping fiction of his novels.
He says he is fascinated by the accusations of multibillion dollar Ponzi schemes, involving tangled webs of companies and offshore banks, which have put Wall Street financier Madoff in jail for 150 years and are also leveled against Texas billionaire and sports entrepreneur Stanford.
Madoff pleaded guilty in March to a $65 billion fraud and was jailed in June, while Stanford has pleaded not guilty to charges that he bilked investors in a $7 billion swindle.
“The thing about Bernie (Madoff) and Allen Stanford, you know, if I wrote that stuff nobody would believe it,” Grisham told reporters at the opening of the North Carolina Literary Festival at the University of North Carolina.
Lawyer-turned-author Grisham, 54, known for his works like “The Firm,” “The Testament” and “The Runaway Jury,” which probe such human failings as greed and deceit, said his imagination is no match for the stories behind real super swindlers.
“I just can’t get enough of this stuff … I love their stories — not for the human drama and the pain and suffering of it, that’s terrible — just for the sheer brazenness of these crooks,” he said.
The SEC’s missed chances to catch Madoff
U.S. securities regulators missed repeated chances to uncover Bernard Madoff’s Ponzi scheme, a sharply critical review by a federal watchdog said on Wednesday.
Read the full report below:
Can someone please send me the password for the document on Scribd! It won’t open without the password!
Live coverage of Bernie Madoff sentencing
Welcome to our live coverage of the Bernie Madoff sentencing. Reuters journalists are outside and inside the Manhattan court where the admitted thief will hear his punishment for running Wall Street’s biggest and most brazen investment scheme. Reuters.com’s intern, Franz Strasser, is sending us updates from the scene that you can follow in the live headline box below.
(Editor’s note: Readers’ comments will appear in a smaller font.)
Update: The live coverage has now ended, but you can still leave a comment below.
I do not understand how so many victims could have invested the majority of their assets with this man. Such action is contrary to the first principal of investing that every child learns from their parents. I sympathize to some degree, but feel that many victim were ignoring obvious signs that things were just too good to be true. To me this means there was a certain complicity in their silence.
Madoff’s last scam
The SEC’s decision to let Ponzi schemer Bernard Madoff off with a “no admission of wrongdoing” settlement could be defended on a number of levels, but none will be very satisfying on a day when the Obama administration is set to give the much-maligned regulatory body sweeping new powers to oversee U.S. securities markets.
Madoff pleaded guilty to a $65 billion investment scam in a separate criminal case and faces sentencing on June 29. There is no way he is ever returning to Wall Street, and he is probably going to jail for the rest of his life.
One might consider it a waste of SEC resources to pursue the case any further. And there’s poetic justice in the agency, which for decades missed the biggest fraud on Wall Street, being denied any satisfaction in the courtroom. SEC sources said the deal with Madoff is in line with a February settlement that also included no admission or denial of the findings.
But with the president just hours away from unveiling his plan to boost the SEC’s resources and widen its mandate to catch future Madoffs, it may have been worth keeping a lawyer or two on the case — for appearances’ sake.
That the SEC could not get Madoff to admit to wrongdoing after he had already pleaded guilty to 11 felony counts had led me to conclude that the SEC can never be reformed and will never be competent to find anything. The expanded powers now being conferred upon them would not have helped them solve the Madoff case earlier. All the evidence they needed had already been provided to them by the Whistle Blower. He gave the SEC a road map and they simply ignored it. Giving them more powers now won’t make them smarter or more capable. There is no security in the securities market. It’s a shell game where fat cats on Wall Street party with the hard earned money and pension fund of the little guy on Mainstreet. Look at Enron, Worldcom, Tyco, etc., etc.
from Funds Hub:
Madoff Junkies
One of the more striking aspects about the Madoff affair is the large number of people who appear to have been 'hooked' on Madoff products.
Money managers were drawn by Madoff's air of mystique, his stellar reputation as a market timer, the apparently steady returns with rock bottom volatility and the absence of fees, which some collected from clients anyway.
Those wanting more could simply have increased allocations but some chose to create new investment vehicles instead. Behind the banks and asset managers which lost money, some names appear again and again.
Take the circle of managers revolving around Sandra Manzke, founder of Tremont, whose Rye unit lost substantially all of its roughly $3 billion in assets.
from Funds Hub:
Shadow of Madoff
It's hard enough for fund firms to get investors to put money into markets when stocks are so volatile, but it seems they're also still having to wrestle with the bad publicity from U.S. financier Bernard Madoff's giant fraud.
Ashraf Mohamed, portfolio manager and head of Islamic funds at investment firm Stanlib in South Africa, told the London leg of the Reuters Islamic Banking and Finance Summit that investors are still nervous of another Madoff.
"All they are doing right now is saying we want to make sure there isn't any risk. One comment is 'let's make sure we don't have another Bernie Madoff situation'," Mohamed said.
However, he doesn't seem too worried about a repeat of the massive Ponzi scheme.
"My take is that it's all hit the fan," he said. "You don't need to concern yourself with assets being inflated (or) with people trying to deceive you because that's come and gone."
from Funds Hub:
Staying positive
There seems to be an endless wave of bad news hitting the hedge fund industry at the moment -- gates and suspensions, record poor performance, the Bernard Madoff scandal and so forth -- but there are still one or two reasons to be positive.
According to a survey of institutional investors by alternative assets data group Preqin, conducted in January (and therefore after the alleged Madoff fraud came to light), only 8 percent said they were no longer confident about hedge funds and would reduce investments.
By contrast, 26 percent said they would be increasing their allocations this year.
This appears to be a more positive picture than for high net worth individuals, who, according to some anecdotal evidence, have become more cautious on hedge funds.
Institutions such as pension funds, in contrast, tend to have time horizons running into decades, so a year of bad performance is not necessarily the be all and end all.
They have also seen equities, which constitute a far greater portion of their portfolios, plummet last year, leaving hedge funds, relatively speaking at least, looking quite good.
Having followed wealthy individuals into hedge funds and helped fuel the industry's massive growth of recent years, they could end up supporting it through the difficult times.
Yes, paying more attention to history would probably have helped in this crisis. But it’s a tough one when it comes to hedge funds – the industry has not been going, on this scale at least, for very long so there is not much history to learn from.
Scandal round-up: Ponzi’s posse
In the words of Warren Buffett, “You always find out who’s been swimming naked when the tide goes out.” But recent months have shown that the nudist beach extended far beyond Wall Street, and beyond the dreams of pioneering schemer Charles Ponzi (above).
For those following along at home, here is a run-down of alleged Ponzi schemes and other scams that have recently emerged during the financial crisis. Pay attention: you can’t tell the faked deaths without a scorecard.
Nicholas Cosmo, Agape World Inc
This Long Island businessman purported to provide commercial bridge loans, but was instead operating a $400 million Ponzi scheme in which early investors are paid with the money of new clients, officials said.
Cosmo was previously convicted of a federal charge of felony fraud and swindle in 1999 and sentenced to 21 months in prison. According to the firm’s website it has made commercial bridge loans, construction loans, acquisition loans and financing for properties nationwide with capital obtained from private sources since 1999.
WHAT IS A PONZI SCHEME?
According to SEC filing dated October 30, 2006 – Sidney D. “Trip” Camper was fired from Elandia Inc. when the Ahkoy family fell victim to investment fraud headed by Elandia’s Allen Stanford and Trip Camper. Forced to resign by Allen Stanford himself (see SEC link below), Trip Camper moved on to his next victim, a private company in Los Angeles. In true School of Stanford form, Trip Camper promised to take the private company public. Instead, Trip Camper recruited a new partner in crime, Ed Berkhof and together they formed a “shell” holding company, milked the private company of thousands of dollars, illegally obtained company stock and pretended to be the company owners- and owners of all the assets. By pretending to own the company’s assets, Trip Camper and Ed Berkhof worked to dupe private investors out of capitol that they used to pay themselves and their creditors. This is a Ponzi Scheme. Instead of taking the company public, Trip Camper and Ed Berkhof spent thousands of dollars, took a trip to London on a company American Express card, performed a hostile takeover, and ruined the honest, profitable company. Since then, the Ahkoy family is suing Elandia Inc., Allen Stanford is in Federal prison, and Trip Camper is still using The Stanford Group as a reference on his curriculum vitae. FBI will hopefully catch up with Allen Stanford’s den of thieves. Don’t let this happen to you.
http://www.secinfo.com/d14D5a.v6Q98.c.ht m
