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Morning Scan: BNP Bids Au Revoir to COO; Crowdfunders Hot for Real Estate

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Au Revoir BNP COO: The chief operating officer of BNP Paribas, Georges Chodron de Courcel, is stepping down as the French lender negotiates with U.S. authorities over a settlement for allegedly violating sanctions. BNP made no mention of the investigation in announcing the departure of the 64-year-old Courcel. But New York Department of Financial Services head Benjamin Lawsky had called for his departure as part of the settlement along with that of several other top bank executives, according to anonymice. Lawsky appears to be having a good week: BNP has tentatively agreed to oust another executive on his blacklist, Vivien Lévy-Garboua, as part of the settlement, more anonymice told the Journal. BNP is expected to give at least a dozen executives the boot in the deal, according to the paper, although settlement discussions are ongoing and could change. The FT reports that Lawsky is pushing for the removal of Levy-Garboua, a senior adviser who previously oversaw compliance for BNP — not that an agreement has been reached. Wall Street Journal, Financial Times, New York Times

Wall Street Journal

Real estate investments are the hottest ticket in crowdfunding, according to the paper. Crowdfunding sites "have raised more than $135 million in debt and equity for real-estate deals," the Journal reports.

Bank of America and the Justice Department are going head-to-head in court over a mortgage case "whose outcome could influence the course of a multibillion-dollar settlement the two sides are seeking to hash out over a broader set of alleged violations," according to the paper. The case being tried at an Ashville, N.C., federal court accuses BofA of misleading investors about the mortgages included in $850 million of securities. If the judge rules against the Justice Department, its position in the broader settlement talks could take a hit, the paper notes.

The Supreme Court has denied former Goldman Sachs director Rajat Gupta's request to remain free on bail while he appeals his 2012 conviction for insider trading. Gupta is slated to begin serving a two-year prison sentence on June 17.

Financial Times

The U.S. Chamber of Commerce is worried that an "excessive" penalty against BNP Paribas could be bad for business. BNP could reportedly pay up to $10 billion to settle accusations that it violated U.S. sanctions. The USCC fears that "actions by government and other entities that could undermine the business environment and create uncertainty," according to Myron Brilliant, the group's head of international affairs.

Ratings agencies are publishing unsolicited critiques of one another's credit ratings — a development that one might think would be welcome in the aftermath of the financial crisis. But the opinions don't appear to be swaying investors much, according to the FT: "Indeed, there are rumblings of a return of ratings shopping—the pre-crisis practice where issuers would sound out rating agencies for their initial feedback on a deal, and then hire the agency that offered the best possible designation."

New York Times

Major banks including Citigroup are still trying to figure out whether they were victims of a commodities fraud scheme in China. If the swindle is confirmed, the Times points out, it could reflect poorly on Citi in the wake of the recently discovered fraud at its Mexican subsidiary, Banamex. "If the Qingdao developments hurt the bank, regulators and shareholders are likely to press it to explain why its controls failed again," write Peter Eavis and Neil Gough.

Washington Post

The Post has a lengthy exit interview with Department of Housing and Urban Development secretary Shaun Donovan, who plans to step down from his position to lead the White House Office of Management and Budget. (His appointment must still be confirmed by the Senate.) Donovan shares memories of being hugged by President Obama after reaching a $25 billion mortgage settlement and emphasizes the urgency of housing finance reform.

Sen. Elizabeth Warren's student loan refinancing bill failed in the Senate Wednesday, but Warren says she plans to reintroduce the bill at a later date.

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(Image: Bloomberg News)

Comments (1)
We just listed a few new projects on a crowdfunding platform (groundbreaker.co) and invite you to follow them if you are interested in seeing some ongoing transactions:
projects.terrafunda.com
Posted by terrafunda | Friday, July 04 2014 at 3:16PM ET
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