“Contrived Facade of Enforcement”: Judge Rips SEC Over BofA Settlement

September 15, 2009

Earlier this year, I shared misgivings of other commentators that Mary Schapiro’s tenure at FINRA rendered her too conflicted to Chair the SEC.  Judge Rakoff’s scathing September 14 order in SEC v. Bank of America adds weight to the argument.  Judge Rakoff rejected the SEC’s settlement, ordering the parties to prepare for trial on February [...]

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Did Accountants Really Let Us Down? Floyd Norris Misfires on FASB & IASB Role in Recession

September 11, 2009

Who ruined your retirement portfolio? In his September 10, 2009 New York Times’ column, Accountants Misled Us Into Crisis , Floyd Norris points the finger at standard-setting accountants at the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB). Norris appears convinced that if the FASB and IASB had written the “right” [...]

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The United States should support Honduras against Manuel Zelaya

July 15, 2009

Some have asked for my views on the Honduran so-called “coup” in which the former Honduran President, Manuel Zelaya, was removed from office upon the order of the Honduran Supreme Court.   Having read the relevant documents in the original Spanish, I agree with Miguel Estrada that the removal was both legal and necessary. For reasons [...]

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How much is that comma worth? How about £3.5 million?

July 10, 2009

Ever get frustrated with attorneys who fuss over precise contract wording?  They do it for good reason:  In negotiating and drafting agreements, millions can be won or lost by the placement of commas or parentheses.   Chartbrook v. Persimmon Homes, decided July 1, 2009 by the British House of Lords,* vividly illustrates the principle that a [...]

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SEC should cease regulatory fraud, quit issuing SABs

June 3, 2009

From the War on Terror to the War on Wall Street, due process violations by government agencies are proliferating like nuclear weapons. Facilitated by widespread ignorance among Americans — general public, financial professions, and the federal judiciary — the pattern of abuse threatens not only American markets but the very foundations of American life. In [...]

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Not even WSJ reporters get FASB accounting standards. Why write more of them?

May 23, 2009

For an eloquent illustration of how accounting innovations like FAS 157′s “fair value” regime are way beyond even above-average American financial readers, try Michael Rapoport’s May 1, 2009 article entitled New FASB Rule Aims to Clarify ‘Net Income’. Rapoport, trying to capture the meaning of the new SFAS No. 160, stumbles over one of the [...]

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Comments on FASB’s fair value amendment reflect FAS 157 distress

April 2, 2009

Lenders have been hammered by the pathologically procyclical impact of FAS 157′s mark-to-market regime.  Hardly surprising, therefore, that banks and credit unions came out in force to support the latest FASB “clarification” of FAS 157.  Some other commenters, mostly from the “analyst” community, emphatically disagree.

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Graham County Soil & Water: Can whistleblowers sue using state or county audits?

March 26, 2009

The federal False Claims Act (FCA) encourages private whistleblowers to sue, usually in partnership with the U.S. Department of Justice, to recover federal funds allegedly misspent by individuals, companies or local government agencies. Rewards of blowing the whistle can be very substantial — up to 30% of the government’s recovery plus attorneys fees — but [...]

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Barney Frank to FASB: Quit pretending to so much reality and certainty in fair value accounting!

March 12, 2009

Today, in congressional action sure to give every internal auditor and financial analyst recurring nightmares, members of the U.S. House Capital Markets Subcommittee demanded that the Financial Accounting Standards Board (FASB) demonstrate greater flexibility and speed in changing market-to-market (or “fair value”) accounting rules in the face of today’s financial industry crisis, or else. Much [...]

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Obama mortgage plan: Every American with a mortgage should call their lender

February 21, 2009

When I first watched commodities traders at Chicago’s CME denounce President Obama’s Homeowner Affordability & Stability Plan, I was on board with the traders. “How dare anyone ask that I help pay off my neighbor’s mortgage? If they bit off more than they could chew, that’s their fault!” But I began to have second thoughts [...]

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