Receiving Wide Coverage ...
SEC's New Enforcer: Chairman Mary Jo White is set to appoint long-time colleague Andrew Ceresney as co-head of the Securities and Exchange Commission's enforcement unit pretty much any day now. Ceresney, who served with White while she was U.S. Attorney for the Southern District of New York and at law firm Debevoise & Plimpton LLP, will share the role with interim enforcement chief George Canellos. Dealbook calls the joint leadership "unusual, if not unprecedented," but also reports it will be temporary. Anonymous sources tell the website Canellos "is expected to return to private practice well before the end of President Obama's second term." The Journal says Ceresney's "appointment will add to the conflict-of-interest headaches at the federal agency," though it also notes such "conflicts aren't unusual." (Recall, White's own former client list includes JPMorgan Chase, Deloitte & Touche, General Electric, Verizon Communications and former Bank of America chief executive Kenneth Lewis.) According to the paper, one of the issues Ceresney and White will have to address involves "whether to change the specialized enforcement units" set up by predecessor Robert Khuzami.
Cybersecurity News: The Obama administration is considering its options for confronting China over cyberspying, reports the Journal. The options, thus far, include "trade sanctions, diplomatic pressure, indictments of Chinese nationals in U.S. courts and cyber countermeasures." Meanwhile, this Dealbook column posits that startups — not major banks (largely targeted by Iranian hackers), media outlets and big tech companies like Google — are most vulnerable to attack. "A digital intrusion carries the risk that critically valuable intellectual property is compromised, leading to their next big idea showing up not on Wall Street, but on the streets of Shanghai," the authors write.
Wall Street Journal
FINRA is fighting state efforts to block companies from monitoring employees' social media accounts. Securities regulators apparently believe "the fast spread of financial advice" on sites like Facebook and Twitter "could create new channels for Ponzi schemes and other frauds" that will be that much harder to thwart should state legislators "snarl efforts by companies to monitor what employees are pitching to investors."
Global banks, including Citigroup, "are fueling a boom in short-term loans" across Asia. These banks are targeting Asia's fast-growing middle class in lieu of weak Western economies, but some analysts worry the loans are being made to borrowers who won't be able to repay them. Lenders, on the other hand, say "they are being careful when they offer credit."
U.S. investment banks are blaming Europe for their lackluster earnings, notes this article, which also doubles as a recap of how the nation's biggest banks performed last quarter.
Some banks are pulling out of "risky regions" in the Middle East, Africa and Asia in an effort to stay in compliance with stricter money-laundering laws. Meanwhile, many senior bankers continue to lobby for these laws to be loosened.
New York Times
Columnist Agnes T. Crane argues the SEC shouldn't adopt a two-tier approach to regulating money market mutual funds after Blackrock CEO Larry Fink indicated only some funds would be required to adopt a floating net asset value. Government debt, it appears, would be exempt. "Regulators, of course, could require additional safeguards for funds with fixed net asset values, like capital buffers," Crane writes. "But that would unnecessarily complicate regulation and supervision. Moreover, it would obscure, not clarify, the risks for investors who aren't likely to take the time to read the fine print."
Here's another story you may already be familiar with: Institutional investors are crowding — and possibly distorting — the housing market. "The big investor activity is pushing up prices, which is good for the large number of homeowners whose mortgages are larger than their home's values," the paper notes. "But for people being shut out of the biggest bargains offered by the housing market, it means a longer, slower slog to building equity."