SAC Capital to Pay $616 Million in Insider Trading Cases

The government’s multiyear campaign to ferret out insider trading on Wall Street has yielded multiple prosecutions of former employees of SAC Capital Advisors, the giant hedge fund owned by the billionaire investor Steven A. Cohen.

On Friday, federal authorities took aim at the fund itself.

In what officials are calling the largest-ever settlement of an insider trading action, SAC agreed to pay securities regulators about $602 million to resolve a lawsuit related to improper trading at the fund.

The landmark penalty exceeds, at least before adjustment for inflation, the fines meted out in the 1980s-era scandals involving Ivan F. Boesky and Michael R. Milken, records at the time. It also underscores SAC’s central role in the government’s recent push to prosecute illegal conduct on trading desks and in eecutive suites, an effort that has yielded about 180 civil actions and more than 75 criminal prosecutions.

SAC also agreed Friday to pay $14 million to resolve its role in an insider trading ring that illegally traded technology stocks including Dell.

“These settlements call for the imposition of historic penalties,” said George S. Canellos, the Securities and Exchange Commission’s acting enforcement director.

Mr. Canellos said the resolutions did not prevent the future filing of additional charges against any person, specifically citing Mr. Cohen, who was not named as a defendant in the civil actions on Friday. Mr. Cohen has not been charged with any wrongdoing and has told his clients that he believes he has done nothing wrong.

In the bigg! er case, the agency said an SAC unit would forfeit $602 million to settle claims that it sold nearly $1 billion in shares of two pharmaceutical companies after a former portfolio manager at the fund received secret information from a doctor about problems with a new drug for Alzheimer’s disease.

For SAC, which is based in Stamford, Conn., manages $15 billion and holds one of the best investment records on Wall Street, the settlements, while another blow to its reputation, resolve a matter that caused some of its investors to withdraw their money. Last fall, regulators warned SAC that they were planning to file an action against the fund.

“These settlements are a substantial step toward resolving all outstanding regulatory matters and allow the firm to move forward,” said Jonathan Gasthalter, a spokesman for SAC.

The settlements still need to be approved by Judge Victor Marrero of Federal District Court in Manhattan, the presiding judge in the case. As part of its agreement with regulators, SAC neither admitted nor denied wrongdoing. That entrenched S.E.C. practice â€" permitting defendants to settle civil claims without acknowledging wrongdoing â€" has come under increased scrutiny by the courts, a trend that legal experts say could lead the judge to question the settlement.

The accusations made against SAC on Friday echo earlier charges brought against individuals who worked at the fund. In November, prosecutors filed criminal charges against Mathew Martoma, a former SAC portfolio manager at the center of illegal drug-stock trades tied to a new Alzheimer’s drug. And Jon Horvath, a former SAC analyst, pleaded guilty last year to participating in the Dell insider trading ring. In its legal filing on Friday, the S.E.C. said Mr. Horvath had leaked secret information to two colleagues; previously, the! commissi! on said that only one former SAC employee had received tips.

A lawyer for Mr. Martoma said SAC’s resolution of the two lawsuits had no bearing on his client, who has denied the charges.

“SAC’s business decision to settle with the S.E.C. in no way changes the fact that Mathew Martoma is an innocent man,” said Charles A. Stillman, the lawyer. “We will never give up our fight for his vindication.”

On a conference call with reporters, government officials bragged that the $616 million amount dwarfed other prominent insider trading settlements. Raj Rajaratnam, a former hedge fund manager convicted in 2011, paid $156 million in combined criminal and civil penalties. Mr. Boesky, a central figure in the 1980s trading scandals, paid $100 million then.

The sum also exceeds the amounts of older enforcement ations, including a $550 million settlement with Goldman Sachs in 2010 related to fraud accusations tied to the sale of mortgage investments, and a $400 million settlement with Mr. Milken, the junk bond financier, in 1990.

The larger of the two cases settled on Friday was based on powerful evidence against Mr. Martoma, the former SAC portfolio manager. The government said Mr. Martoma had caused SAC to sell nearly $1 billion in shares of Elan and Wyeth because he obtained secret information from a doctor about clinical trials for a drug being developed by the companies. Prosecutors have secured the testimony of the doctor who reportedly leaked Mr. Martoma the drug trial data.

In b! ringing t! he criminal charge against Mr. Martoma, prosecutors appeared to be moving closer to building a case against Mr. Cohen. The complaint noted that Mr. Cohen had a 20-minute phone call with Mr. Martoma the night before SAC began dumping its holdings. Prosecutors, though, have not claimed that Mr. Cohen knew that Mr. Martoma had confidential data about the drug’s prospects.

The F.B.I. has tried unsuccessfully several times to persuade Mr. Martoma to plead guilty and cooperate against Mr. Cohen.

While the $602 million settlement in the Martoma case is a prodigious sum, it is considerably less than the maximum that the S.E.C. could have extracted. The agreement required SAC to pay about $275 million, an amount representing disgorged illegal gains, as well as $52 million in interest In addition, SAC agreed to pay a $275 million penalty, an amount equal to the illicit gains. Under the securities laws, however, the S.E.C. could have secured a penalty of three times that amount, or $825 million.

The forfeited money will come from SAC, meaning that the firm will write the government a check. SAC’s investors will not pay anything or absorb any losses. The $616 million will go into a general revenue fund of the United States Treasury.

Representing SAC in its talks with the S.E.C. were Martin Klotz of Willkie Farr & Gallagher and Daniel J. Kramer of Paul Weiss Rifkind Wharton & Garrison.

While the resolution of these two cases provides a measure of relief to SAC and its clients, the hedge fund’s legal problems have already damaged its business. Though SAC has returned about 30 percent annually to its investors over the last two decades â€" a virtually peerless track record â€" many of its clients have parted ways with the fund.

Last month, SAC investors ask! ed to wit! hdraw $1.7 billion, more than a quarter of the $6 billion that the fund manages for outside clients. The balance of SAC’s $15 billion belongs to Mr. Cohen and his employees. The next regularly scheduled deadline for SAC clients to ask for their money back is mid-May.

In calls with concerned clients, SAC has highlighted its stepped-up efforts in building its legal staff and compliance procedures â€" an initiative that Mr. Gasthalter reiterated Friday. “We are committed to continuing to maintain a first-rate compliance effort woven into the fabric of the firm.” On a conference call discussing the case, Mr. Canellos was asked whether the S.E.C. felt that SAC was committed to keeping a strong culture of compliance.

“I sure hope they are,” Mr. Canellos said.

This post has been revised to reflect the following correction:

Correction: March 16, 2013

An earlier version of this article incorrectly reported the amount of the settlement because rounded numbers ere added. Adding the exact numbers and then rounding, the total is $616 million, not $614 million.

JPMorgan Executives Face Withering Questions at Senate Hearing

WASHINGTON â€" A top JPMorgan Chase executive struggled to defend his actions on Friday as lawmakers scrutinized the bank’s multibillion-dollar trading loss.

For nearly an hour, the executive, Douglas L. Braunstein, was berated for playing down JPMorgan’s risky bets to investors and regulators on a conference call in April, just weeks before the bank disclosed the costly blowup.

“You give this very glowing call,” said Senator Carl Levin, Democrat of Michigan, “instead of telling them what you knew” â€" that the portfolio “had been losing money and violating risk limits.”

Mr. Braunstein defended his statements in the conference call, saying they wee the most “accurate” depiction based on the information at the time.

“You thought that was a balanced presentation” Mr. Levin asked incredulously, peering over his glasses.

The long, and often tense, Congressional hearing on Friday put JPMorgan in a tough position. While the investment bank has tried to distance itself from the trading debacle, the hearing, which follows a nine-month inquiry, is renewing the pressure on JPMorgan and its influential chief executive, Jamie Dimon.

During nearly six hours of testimony on Friday, Mr. Levin and a handful of colleagues questioned current and former executives about the bank’s risk management, oversight policies and pricing methods. The lawmakers took aim at JPMorgan for misleading investors and regulators about the disastrous bet, building off a scathing, 300-! page Congressional report released on Thursday.

The executives floundered, at times, as they tried to counter the claims. They described efforts to reduce risk as the losses swelled, but indicated that such moves had been “undermined” by traders who deliberately undervalued bets to disguise the growing losses. Such testimony could provide fresh ammunition for the Securities and Exchange Commission, which is investigating the trading loss.

“We have made regrettable errors and overhauled our risk policies to correct these mistakes,” a bank spokeswoman said, “but senior JPMorgan executives always provided information to regulators and the public that they believed to be accurate.”

While Mr. Dimon was not present at the hearing, he was referred to repetedly as lawmakers explored how JPMorgan had resisted regulators’ requests for information.

One episode emerged as emblematic: for a brief period in 2011, regulators stopped receiving profit and loss reports from the bank. Mr. Dimon, the executives explained, had ordered the information halted because of broad security concerns.

Senator John McCain, Republican of Arizona, challenged that decision. “Do we live in a world,” he asked, where “we just decide, well, because we’re concerned about something, we’re not going to comply with regulations”

In an especially contentious exchange, Mr. Braunstein, a vice chairman of JPMorgan and its former chief financial officer, faced off with Mr. Levin over issues of disclosure. The senator questioned Mr. Braunstein’s statements on the April conference call, whi! ch indica! ted that the trading positions were made with the blessing of “risk management at the firmwide level” and were “transparent to regulators.” Those statements, Mr. Levin argued, painted an “inaccurate impression” about the nature of the trades and their risks.

Citing the bank’s internal testing of the portfolio at the time, Mr. Levin told Mr. Braunstein the characterization of the trades as a hedge was false. The testing, he said, had shown that the trades would not defray losses in the same manner as a hedge.

After unrelenting questioning, Mr. Braunstein conceded that, in contrast to his statements in April, regulators did not receive granular information about the trades “on a regular and recurring basis.” Even so, he maintained that his earlier statements were accurate based on the information at the time.

For Ina Drew, who resigned in May as the head of JPMorgan’s chief investment office, the group at the center of the problems, the hearing was the first opportunity t publicly defend her role in the troubled trades. While Ms. Drew acknowledged that “things went terribly wrong,” she directed virtually all of the blame at lower-level traders in London and other subordinates.

She returned to this defense throughout the hearing, deflecting culpability by faulting inaccurate information. In one bruising exchange, she was forced to explain why the bank stopped giving regulators profit and loss reports for the chief investment office during a critical period last year.

Ms. Drew responded that she had had no idea that the reports were not being provided to regulators. “If I had known,” she said, “I would have considered it the wrong thing to do.”

The senators also asked Ms. Drew why the bank had assured regulators in January 2012 that it was slashing the size of its positions when, in fact, it was expanding them. Ms. Drew maintained that there had been no deliberate duplicity. She said she had not been aware that the traders were increasing ! their bet! s.

The lawmakers pressed her similarly about why JPMorgan told regulators in April that the trading loss was roughly $580 million, when internal projections put the figure at more than $700 million. Ms. Drew reiterated that she had acted based on information that was correct to “the best of her knowledge.”

Such blame shifting prompted criticism by Mr. McCain, the subcommittee’s top Republican. “The traders seemed to have more responsibility and authority than the higher-up executives,” he said.

While Ms. Drew and Mr. Braunstein weathered the fiercest questioning, none of the executives were spared. Even Michael J. Cavanagh, co-head of the corporate and investment bank, who has emerged as a leading contender to succeed Mr. Dimon, came under fire.

Mr. Levin pushed Mr. Cavanagh to admit that the bank had altered its method for pricing trades to minimize losses. Mr. Cavanagh stood firm, arguing that the valuations were fair.

But Mr. Levin persisted, asking, “How do you ossibly justify your process” Was it a “coincidence,” he asked, that the models shifted just as losses on the trades were ballooning At one point, he reminded Mr. Cavanagh that he was under oath.

He excoriated Peter Weiland, who used to be in charge of market risk for the chief investment unit, for censuring a JPMorgan analyst over an e-mail that outlined strategies for tweaking risk modeling. Mr. Levin pressed Mr. Weiland on his resistance to using e-mail, suggesting that the executive was trying to avoid creating a paper trail.

“Why hide it” Mr. Levin asked. If JPMorgan’s dealings were appropriate, why shy away “from putting it in writing”

Mr. Weiland responded that his objective was to prevent anyone from “misconstruing” the bank’s intentions.

JPMorgan Executives Face Withering Questions at Senate Hearing

WASHINGTON â€" A top JPMorgan Chase executive struggled to defend his actions on Friday as lawmakers scrutinized the bank’s multibillion-dollar trading loss.

For nearly an hour, the executive, Douglas L. Braunstein, was berated for playing down JPMorgan’s risky bets to investors and regulators on a conference call in April, just weeks before the bank disclosed the costly blowup.

“You give this very glowing call,” said Senator Carl Levin, Democrat of Michigan, “instead of telling them what you knew” â€" that the portfolio “had been losing money and violating risk limits.”

Mr. Braunstein defended his statements in the conference call, saying they wee the most “accurate” depiction based on the information at the time.

“You thought that was a balanced presentation” Mr. Levin asked incredulously, peering over his glasses.

The long, and often tense, Congressional hearing on Friday put JPMorgan in a tough position. While the investment bank has tried to distance itself from the trading debacle, the hearing, which follows a nine-month inquiry, is renewing the pressure on JPMorgan and its influential chief executive, Jamie Dimon.

During nearly six hours of testimony on Friday, Mr. Levin and a handful of colleagues questioned current and former executives about the bank’s risk management, oversight policies and pricing methods. The lawmakers took aim at JPMorgan for misleading investors and regulators about the disastrous bet, building off a scathing, 300-! page Congressional report released on Thursday.

The executives floundered, at times, as they tried to counter the claims. They described efforts to reduce risk as the losses swelled, but indicated that such moves had been “undermined” by traders who deliberately undervalued bets to disguise the growing losses. Such testimony could provide fresh ammunition for the Securities and Exchange Commission, which is investigating the trading loss.

“We have made regrettable errors and overhauled our risk policies to correct these mistakes,” a bank spokeswoman said, “but senior JPMorgan executives always provided information to regulators and the public that they believed to be accurate.”

While Mr. Dimon was not present at the hearing, he was referred to repetedly as lawmakers explored how JPMorgan had resisted regulators’ requests for information.

One episode emerged as emblematic: for a brief period in 2011, regulators stopped receiving profit and loss reports from the bank. Mr. Dimon, the executives explained, had ordered the information halted because of broad security concerns.

Senator John McCain, Republican of Arizona, challenged that decision. “Do we live in a world,” he asked, where “we just decide, well, because we’re concerned about something, we’re not going to comply with regulations”

In an especially contentious exchange, Mr. Braunstein, a vice chairman of JPMorgan and its former chief financial officer, faced off with Mr. Levin over issues of disclosure. The senator questioned Mr. Braunstein’s statements on the April conference call, whi! ch indica! ted that the trading positions were made with the blessing of “risk management at the firmwide level” and were “transparent to regulators.” Those statements, Mr. Levin argued, painted an “inaccurate impression” about the nature of the trades and their risks.

Citing the bank’s internal testing of the portfolio at the time, Mr. Levin told Mr. Braunstein the characterization of the trades as a hedge was false. The testing, he said, had shown that the trades would not defray losses in the same manner as a hedge.

After unrelenting questioning, Mr. Braunstein conceded that, in contrast to his statements in April, regulators did not receive granular information about the trades “on a regular and recurring basis.” Even so, he maintained that his earlier statements were accurate based on the information at the time.

For Ina Drew, who resigned in May as the head of JPMorgan’s chief investment office, the group at the center of the problems, the hearing was the first opportunity t publicly defend her role in the troubled trades. While Ms. Drew acknowledged that “things went terribly wrong,” she directed virtually all of the blame at lower-level traders in London and other subordinates.

She returned to this defense throughout the hearing, deflecting culpability by faulting inaccurate information. In one bruising exchange, she was forced to explain why the bank stopped giving regulators profit and loss reports for the chief investment office during a critical period last year.

Ms. Drew responded that she had had no idea that the reports were not being provided to regulators. “If I had known,” she said, “I would have considered it the wrong thing to do.”

The senators also asked Ms. Drew why the bank had assured regulators in January 2012 that it was slashing the size of its positions when, in fact, it was expanding them. Ms. Drew maintained that there had been no deliberate duplicity. She said she had not been aware that the traders were increasing ! their bet! s.

The lawmakers pressed her similarly about why JPMorgan told regulators in April that the trading loss was roughly $580 million, when internal projections put the figure at more than $700 million. Ms. Drew reiterated that she had acted based on information that was correct to “the best of her knowledge.”

Such blame shifting prompted criticism by Mr. McCain, the subcommittee’s top Republican. “The traders seemed to have more responsibility and authority than the higher-up executives,” he said.

While Ms. Drew and Mr. Braunstein weathered the fiercest questioning, none of the executives were spared. Even Michael J. Cavanagh, co-head of the corporate and investment bank, who has emerged as a leading contender to succeed Mr. Dimon, came under fire.

Mr. Levin pushed Mr. Cavanagh to admit that the bank had altered its method for pricing trades to minimize losses. Mr. Cavanagh stood firm, arguing that the valuations were fair.

But Mr. Levin persisted, asking, “How do you ossibly justify your process” Was it a “coincidence,” he asked, that the models shifted just as losses on the trades were ballooning At one point, he reminded Mr. Cavanagh that he was under oath.

He excoriated Peter Weiland, who used to be in charge of market risk for the chief investment unit, for censuring a JPMorgan analyst over an e-mail that outlined strategies for tweaking risk modeling. Mr. Levin pressed Mr. Weiland on his resistance to using e-mail, suggesting that the executive was trying to avoid creating a paper trail.

“Why hide it” Mr. Levin asked. If JPMorgan’s dealings were appropriate, why shy away “from putting it in writing”

Mr. Weiland responded that his objective was to prevent anyone from “misconstruing” the bank’s intentions.

Week in Review: A Rebuke for the Absent C.E.O.

SAC settles insider trading cases for $614 million. | Senate inquiry faults JPMorgan on trading loss. | Fed faults two big banks over plans for capital. | At hearing, nominee for S.E.C. chief vows to be a tough Wall St. regulator. | Andrew Ross Sorkin on the realities behind prosecuting big banks.

A look back on our reporting of the past week’s highs and lows in finance.

Hostess Sells Twinkies Brand to Investment Firms | The deal, worth $410 million, was struck nearly four months after the last Twinkie rolled off the baking lines. DealBook »

Deal Professor: In Spinoffs, a Chance to Jettison Undesirable Liabilities | Steven M. Davidoff says that spinning off its magazine unit may be a good move for Time Warner, but spinoffs have a dark side, serving as a convenient dumping ground for unwanted businesses. DealBook »

Dell Agrees to Show Financials to Icahn | In exchange, the billionaire â€" who was critical of a deal just last week â€" has agreed to confidentiality, which silences, temporarily at least, the influential investor. DealBook »

UBS Awards $26 Million to Investment Bank Chief | The amount was to compensate the executive for pay he forfeited when he left Bank of America Merrill Lynch. DealBook »

Private Equity Squeezes Out Cash Long After Its Exit | An obscure tax strategy is the latest technique that private equity firms are using to extract money from their companies well after completing an initial public offering. DealBook »

SAC Settles Insider Trading Cases for $614 Million | Two affiliates of the giant hedge fund have settled insider trading cases with the S.E.C., for $614 million, in what the agency said was the biggest ever settlement for such cases. DealBook »

Senate Inquiry Faults JPMorgan on Trading Loss | The findings shed new light on the multibillion-dollar blunder and may foreshadow potential criminal cases against JPMorgan Chase employees. DealBook »

Fed Faults 2 Big Banks Over Plans for Capital | Goldman Sachs and JPMorgan Chase, the Wall Street giants that emerged from the financial crisis in a position of strength, are now facing questions about their bility to withstand future market shocks. DealBook »

Prominent Lawyer Is Accused of Sexual Harassment | A former lawyer at Faruqi & Faruqi filed a lawsuit that accused one of its partners of making improper comments and unwanted sexual advances. DealBook »

Private Equity Firms Fail in Effort to Dismiss Antitrust Case | At the same time, the federal judge suggested that the plaintiffs’ lawsuit was overly broad and had serious flaws. DealBook »

Ex-Pimco Executive Backs Out of Lawsuit | A former high-yield bond portfolio manager at Pimco claimed that he had witnessed multiple instances of ! wrongdoin! g by the firm’s senior management from late 2008 to early 2009. DealBook »

At Hearing, Nominee for S.E.C. Chief Vows to Be a Tough Wall St. Regulator | The Senate Banking Committee is expected to approve the candidate, who provided few details of her plans for the S.E.C. DealBook »

• Nominee to Lead the S.E.C. Vows an ‘Unrelenting’ Fight on Fraud | In written testimony released a day before her Senate confirmation hearing on Tuesday, Mary Jo White said unearthing financial fraud would be a priority. DealBook »

DealBook Column: Realities Behind Prosecuting Big Banks | Andrew oss Sorkin says that recent comments by the attorney general seem to contradict the administration’s view that too-big-to-fail was fixed by the Dodd-Frank financial regulation law. DealBook »

Responding to Financial Crisis, Britain Overhauls Its Regulators | Britain, unlike other economic powers, is responding to the financial crisis by creating two new agencies, one to oversee institutions and another to watch for market abuses. DealBook »

Oppenheimer Settles Accusations of Misleading Investors | The S.E.C. said that Oppenheimer had inflated the value of the largest investment in its fund. The false valuation raised the fund’s internal rate of return. DealBook »

Online Betting Site Intrade Is Shut After Audit Queries | The moves followed concerns raised by the company’s auditors over more than $1.5 million payments to Intrade’s founder, John Delaney, and other unnamed third parties. DealBook »

Eurythmics ‘Would I Lie to You’

‘Would I Lie to You’ | What is the perfect song to listen to before you testify before Congress YouTube »

Week in Review: A Rebuke for the Absent C.E.O.

SAC settles insider trading cases for $614 million. | Senate inquiry faults JPMorgan on trading loss. | Fed faults two big banks over plans for capital. | At hearing, nominee for S.E.C. chief vows to be a tough Wall St. regulator. | Andrew Ross Sorkin on the realities behind prosecuting big banks.

A look back on our reporting of the past week’s highs and lows in finance.

Hostess Sells Twinkies Brand to Investment Firms | The deal, worth $410 million, was struck nearly four months after the last Twinkie rolled off the baking lines. DealBook »

Deal Professor: In Spinoffs, a Chance to Jettison Undesirable Liabilities | Steven M. Davidoff says that spinning off its magazine unit may be a good move for Time Warner, but spinoffs have a dark side, serving as a convenient dumping ground for unwanted businesses. DealBook »

Dell Agrees to Show Financials to Icahn | In exchange, the billionaire â€" who was critical of a deal just last week â€" has agreed to confidentiality, which silences, temporarily at least, the influential investor. DealBook »

UBS Awards $26 Million to Investment Bank Chief | The amount was to compensate the executive for pay he forfeited when he left Bank of America Merrill Lynch. DealBook »

Private Equity Squeezes Out Cash Long After Its Exit | An obscure tax strategy is the latest technique that private equity firms are using to extract money from their companies well after completing an initial public offering. DealBook »

SAC Settles Insider Trading Cases for $614 Million | Two affiliates of the giant hedge fund have settled insider trading cases with the S.E.C., for $614 million, in what the agency said was the biggest ever settlement for such cases. DealBook »

Senate Inquiry Faults JPMorgan on Trading Loss | The findings shed new light on the multibillion-dollar blunder and may foreshadow potential criminal cases against JPMorgan Chase employees. DealBook »

Fed Faults 2 Big Banks Over Plans for Capital | Goldman Sachs and JPMorgan Chase, the Wall Street giants that emerged from the financial crisis in a position of strength, are now facing questions about their bility to withstand future market shocks. DealBook »

Prominent Lawyer Is Accused of Sexual Harassment | A former lawyer at Faruqi & Faruqi filed a lawsuit that accused one of its partners of making improper comments and unwanted sexual advances. DealBook »

Private Equity Firms Fail in Effort to Dismiss Antitrust Case | At the same time, the federal judge suggested that the plaintiffs’ lawsuit was overly broad and had serious flaws. DealBook »

Ex-Pimco Executive Backs Out of Lawsuit | A former high-yield bond portfolio manager at Pimco claimed that he had witnessed multiple instances of ! wrongdoin! g by the firm’s senior management from late 2008 to early 2009. DealBook »

At Hearing, Nominee for S.E.C. Chief Vows to Be a Tough Wall St. Regulator | The Senate Banking Committee is expected to approve the candidate, who provided few details of her plans for the S.E.C. DealBook »

• Nominee to Lead the S.E.C. Vows an ‘Unrelenting’ Fight on Fraud | In written testimony released a day before her Senate confirmation hearing on Tuesday, Mary Jo White said unearthing financial fraud would be a priority. DealBook »

DealBook Column: Realities Behind Prosecuting Big Banks | Andrew oss Sorkin says that recent comments by the attorney general seem to contradict the administration’s view that too-big-to-fail was fixed by the Dodd-Frank financial regulation law. DealBook »

Responding to Financial Crisis, Britain Overhauls Its Regulators | Britain, unlike other economic powers, is responding to the financial crisis by creating two new agencies, one to oversee institutions and another to watch for market abuses. DealBook »

Oppenheimer Settles Accusations of Misleading Investors | The S.E.C. said that Oppenheimer had inflated the value of the largest investment in its fund. The false valuation raised the fund’s internal rate of return. DealBook »

Online Betting Site Intrade Is Shut After Audit Queries | The moves followed concerns raised by the company’s auditors over more than $1.5 million payments to Intrade’s founder, John Delaney, and other unnamed third parties. DealBook »

Eurythmics ‘Would I Lie to You’

‘Would I Lie to You’ | What is the perfect song to listen to before you testify before Congress YouTube »

TiVo Explains Extra Charge for the Mini

In my column in The Times on Thursday, I reviewed the TiVo Mini. It’s a small plastic box that lets you gain access to your TiVo from another television in the house without having to buy a second entire TiVo.

But I also wrote:

Incredibly, though, you still have to pay another fee for the Mini: $6 a month, or a one-time $150. Why The fee you’re already paying for your TiVo is already hard to justify; why should you pay more just to pump your legitimately recorded shows to a different room

Unfortunately, “because we need the money” is the only plausible reason. (I suppose “because our arch-rival, the Dish Hopper, also charges for its secondary-TV boxes” is also plausible.)

After the column was published, Jim Denney, TiVo’s product marketing manager, explained to me why there was a fee for the Mini.

First, h reiterated my point that all of TiVo’s rivals, like the Dish Hopper, DirecTV Genie and cable-company boxes, also charge a fee for each second-TV box.

Second, he pointed out that the Mini’s $6 monthly fee is a lot lower than what you’d pay for a second TiVo box ($15 monthly).

“Yes,” I said, “but what are you actually buying I mean, you’re already paying a fee for your main TiVo box. The Mini just shows what’s on your main TiVo â€" it doesn’t supply any new features of its own. TiVo isn’t providing any services that would justify a separate fee. All the action is within my own network.”

He explained to me that that’s not quite accurate. The Mini does connect to TiVo’s service â€" bypassing your main TiVo â€" for many of its functions. For example, when you access Hulu Plus, YouTube, the search and browse functions, and the music and photo functions, the Mini goes directly to the TiVo mothership online.

He also pointed out that the Mini will gain more f! eatures and polish as time goes by, and that’s worth paying something for, too.

I’m still skeptical. I don’t even see why standalone DVR’s need a monthly fee. Unfortunately, for better or worse, that’s the business model we’re all stuck with, no matter who’s providing the boxes: you pay a monthly fee for your DVR, and another one for each secondary-TV box.

At least TiVo offers you the chance to pay a one-time lump-sum fee for each device â€" and if you opt for the monthly fee, at least it’s lower than most of its rivals.

SAC Settles Insider Trading Cases for $614 Million

Two affiliates of SAC Capital, the giant hedge fund, settled insider trading charges with the Securities and Exchange Commission for $614 million, in what the agency said was the biggest ever settlement for such cases.

One affiliate, CR Intrinsic, agreed to pay over $600 million over charges tied to one of its employees, who is accused of trading on illicitly obtained confidential information about the drug makers Elan and Wyeth. That employee, Mathew Martoma, still faces both civil charges from the S.E.C. and criminal charges from the Justice Department.

The other affiliate, Sigma Capital Management, agreed t pay $14 million to settle charges that it engaged in insider trading in the stocks of Dell and Nvidia.

SAC’s management company will pay the settlements, meaning that investors of the hedge fund aren’t on the hook.

The settlements, especially that of CR Intrinsic, represent more successes by the federal government in its campaign against insider trading.

“The historic monetary sanctions against CR Intrinsic and its affiliates are sharp warning that the S.E.C. will hold hedge fund advisory firms and their funds accountable when employees break the law to benefit the firm,” George S. Canellos, the acting director of the S.E.C.’s enforcement division, said in a statement.

A spokesman for SAC noted in a statement that Steven A. Cohen, the founder of the hedge fund, has not been charged with any wrongdoing.

The ! spokesman added, ““We are happy to put the Elan and Dell matters with the S.E.C. behind us. This settlement is a substantial step toward resolving all outstanding regulatory matters and allows the firm to move forward with confidence. We are committed to continuing to maintain a first-rate compliance effort woven into the fabric of the firm.”

TimesCast: Regulating Big Banks

The Times’s David Gillen on new findings against JP Morgan Chase and Louise Story talks to F.D.I.C. Vice Chairman Thomas Hoenig, who says banks are too big to manage.

Paulson Not Planning a Move to Puerto Rico

So much for a new life in a tropical, low-tax paradise.

John A. Paulson, the billionaire hedge fund manager, has no plans to move to Puerto Rico, his firm said in a news release on Friday. The unusual statement followed reports that the financier had looked at real estate in San Juan.

“In light of the media attention surrounding a relocation to Puerto Rico,” the announcement said, Mr. Paulson “has no plans to move to Puerto Rico.”

“While Mr. Paulson has considered real estate investments and has vacationed on the Island, he has no plans to establish a permanent residence there,” the release said.

A residence in the United States territory of Puerto Rico might have offered some tax relief to Mr. Paulson, Bloomberg News reported earlier this week.

Other wealthy individuals in the United States and Europe, including the actor Gerard Depardieu, have relocated recently in the face of higher taxes, the report noted.

But Mr. Paulson, at least for now, won’t be among them.

Live Blog: Senate Panel on JPMorgan’s Trading Loss

JPMorgan Chase ignored internal controls and manipulated documents s the nation’s biggest bank racked up trading losses last year,, while its influential chief executive, Jamie Dimon, briefly withheld some information from regulators, a new Senate report says.

The findings by Senate investigators shed new light on the $6.2 billion trading blunder, which has claimed the jobs of some top executives and prompted investigations by authorities. The 300-page report, released yesterday, will escalate the debate in Washington over regulating Wall Street.

A Senate subcommittee plans to question bank executives and regulators in a hearing beginning at 9:30 A.M. today. DealBook will be live-blogging the hearing.

Erin Callan: ‘I Leaned In Far’

Almost five years after leaving Lehman Brothers, Erin Callan is fashioning a new identity as a commentator.

In an interview scheduled to air Friday evening on “Rock Center With Brian Williams” on NBC, Ms. Callan, Lehman’s former chief financial officer, opines on issues facing women in the workplace. The media appearance follows an essay by Ms. Callan in The New York Times on Sunday, in which she used her own experience to discuss these themes.

“I feel like I got to live an amazing life, and I’m still living an amazing life. But there was a time that cme, naturally, for reflection,” Ms. Callan says in excerpts of the NBC interview released Friday morning. “There was a punctuation point in my life.”

That refers, presumably, to her exit from Lehman, at a time when the investment bank was on the brink of collapse. Ms. Callan worked at Credit Suisse for a brief while after that, before retreating from public view. After putting her house in East Hampton up for sale, she is currently living in Florida.

Ms. Callan expressed regret in the Times essay about how she let her work consume her life. But it was “surprising” t! o her that some readers interpreted that to mean she was “very sad,” Ms. Callan says in the new interview.

In the conversation with NBC’s Ann Curry, Ms. Callan, who has no children of her own, speculates about how her work might have been different if she had been a mother.

“I might have been asked to be C.F.O. I don’t know if I could have actually been the C.F.O.,” she says. “It’s important distinction.”

The conversation nods to the current discussion surrounding “Lean In,” the book by the Facebook executive Sheryl Sandberg. “I leaned in far, very far,” Ms. Callan says.

The former Wall Streeter even has a theory on why fewer women than men rise o the upper echelons of power in the United States.

“Maybe they don’t want that,” she says. Then she adds, “I wanted it. But it’s O.K. not to.”

$57.6 Million a Piece for Carlyle’s Founders

By Greg Roumeliotis

NEW YORK, March 14 | Thu Mar 14, 2013 8:45pm EDT

(Reuters) - The founders of Carlyle Group LP received $57.6 million each in dividends from their stake in the private equity firm and executive pay in 2012, a regulatory filing showed on Thursday, down from $137.8 million in 2011.

David Rubenstein, William Conway and Daniel D'Aniello, who founded Washington, D.C.-based Carlyle in 1987 and are now in their sixties, each forfeited a bonus of around $3.5 million they received in previous years.

Yet most of their profits come from their ownership of the firm. They received $57.3 million each from their individual 15.4 percent stakes in Carlyle. They each also received $281,250 in executive compensation.

In aggregate, this was down from the $137.8 million they received in 2011, before the firm raised $671 million in an initial public offering in May 2012 by selling a roughly 10 percent stake. Carlyle's distributable earnings were also down, from $864.4 million in 2011 to $687.9 million in 2012.

"We're all about alignment of interests. If our investors do well, we do well. The founders reinvested most of their gains and gave much to worthy causes," Carlyle spokesman Chris Ullman said.

Rubenstein, Conway and D'Aniello received $78.1 million, $140.1 million and $80 million from Carlyle's funds respectively in 2012 as a result of investing alongside the firm's clients. In the same year, they invested $78.7 million, $140 million and $78.3 million respectively in Carlyle's funds.

Overall, Carlyle and its employees increased their commitments to the firm's investment funds in 2012 by approximately $1 billion.

The earnings of Blackstone Group LP head Stephen Schwarzman were flat in 2012 at around $213 million, while Leon Black, the CEO at private equity rival Apollo Global Management LLC, closed in on him with a 73 percent rise in his earnings to $180.2 million.

KKR & Co LP's co-founders and chief executives, Henry Kravis and George Roberts, received about $137 million and $141 million respectively in executive compensation and cash dividends in 2012, up by more than 45 percent over what they received in 2011.

With $170 billion in assets under management across 113 funds and 67 fund-of-fund vehicles, Carlyle has diversified beyond private equity in alternative asset classes such as corporate credit, real estate and hedge funds.

JPMorgan Faulted Over Trading Loss

JPMORGAN FAULTED OVER TRADING LOSS  |  Congressional investigators on Thursday released a harsh portrait of the events surrounding JPMorgan Chase’s huge trading loss last year, saying the bank ignored internal risk controls while its chief executive, Jamie Dimon, briefly withheld some information from regulators. The 300-page report is sure to escalate the debate over policing Wall Street, and it may foreshadow a criminal case against employees at the center of the trading disaster, Jessica Silver-Greenberg and Ben Protess report in DealBook. Current and former JPMorgan executives, including Ina Drew, who led the office that oversaw the trades, are scheduled to testify at a hearing starting at 9:30 a.m., which DealBook will be live-blogging.

A spokeswoman for the bank said: “While we have repeatedly acknowledged significant mistakes, our senior management acted in good faith and never had any intent to mislead anyone.” Mr. Dimon, who once was heralded as an astute manager of risk, is severely criticized in the report. He approved changes to an internal alarm system that underestimated losses, seemingly in contrast to the chief executive’s earlier statements to lawmakers, the report says. Mr. Dimon is also accused of withholding from regulators details about the losses and then raising his voice at a deputy who later provided the information.

“While people close to the matter dispute whether the outburst actually happened, it illustrates a broader problem ! at JPMorgan,” DealBook writes. “After emerging from the financial crisis in far better shape than rivals, the bank saw itself as being above its regulators. The bank was so filled with hubris, Senate investigators said, that an executive once screamed at examiners and called them ‘stupid.’” The report cites some of the private documents now being examined by the Federal Bureau of Investigation.

As with past investigations, the Senate report includes a trove of internal communications at the bank. Among the details: In mid-March last year, a low-level trader started tracking on a spreadsheet the difference between the bank’s favorable valuations of derivatives and the midpoint prices, enabling the traders to hide losses, according to the report. Bruno Iksil, the trader known as the London Whale, told his manager via instant message that the difference “has increased to 300 now,” eaning $300 million, later adding that it could grow to “1000,” or $1 billion. One colleague responded “ouch,” to which Mr. Iksil said, “well that is the pace.”

GOLDMAN AND JPMORGAN MUST REDO CAPITAL PLANS  |  The Federal Reserve said on Thursday that Goldman Sachs and JPMorgan Chase were not strong enough to go ahead with plans to pay out billions of dollars to shareholders, telling the banks to resubmit their proposals. In contrast, Citigroup and Bank of America, two of the most troubled banks after the financial crisis, got a green light for their plans, DealBook’s Peter Eavis writes.

“The Fed’s rebuke to Goldman and JPMorgan highlights growing tension as regulators try to make sure banks are better prepared for the next market shock. With profits improving, financial ! instituti! ons want to enrich investors by increasing dividends and buying back shares. But regulators want banks to be cautious with their capital, in case of future losses.”

Goldman and JPMorgan, which had been expected by analysts to gain approval for their plans, now have to address the shortcomings and resubmit their plans by the end of September.

AU REVOIR, LASRY  |  Rumors had buzzed around Wall Street for months that Marc Lasry, the billionaire chief executive of Avenue Capital, would be named ambassador to France after supporting President Obama in his re-election campaign. Now, it appears that Bill Clinton may have spilled the beans.

At a fund-raising event on Wednesday, the former president said that Mr. Lasry “got some good news” earlier that day, adding that he was informed he was the new ambassador to France, according to a report by Politico. Mr. Clinton “had asked the president to consider” the appointment, Politico says, citing an unidentified person. If Mr. Lasry indeed has the job, it’s unlikely that his hedge fund would be significantly affected, Absolute Return reported earlier.

ON THE AGENDA  |  The consumer price index for February is out at 8:30 a.m., and data on industrial production that month is out at 9:15 a.m. Alan Greenspan is on CNBC at 7:30 a.m. H. Rodgin Cohen, senior chairman at Sullivan & Cromwell, is on Bloomberg TV at 7:30 a.m. An interview with Erin Callan, the former chief financial officer of Lehman Brothers, airs on NBC’s “Rock Center” at 10 p.m.

GEITHNER’S CRISIS TELL-ALL  |  Timothy F. Geithner is preparing to tell his side of what happened during the financial crisis and the recession, with a book coming in 2014, his publisher said on Thursday. The former Treasury secretary (who was president of the New York Fed during the depths of the crisis) “will aim to answer the most important - and to many the most troubling - questions about the choices he and his colleagues made,” Crown Books, an imprint of Random House, said in a release. The Media Decoder blog notes that Mr. Geithner is “uniquely situated to provide inside information on decision making.”

Mergers & Acquisitions »

Anschutz Calls Off Sale of Entertainment Arm  |  The investment company owned by the billionaire Philip Anschutz has decided to call off efforts to sell the Anschutz Entertainment Group, a sports and live entertainment juggernaut.
DealBook »

Deal-Making Seen in Time Inc.’s Future  |  With an estimated enterprise value of about $3.9 billion, the magazine spinoff from Time Warner could look at a range of possible deals, analysts said, according to Bloomberg News.
BLOOMBERG NEWS

I.B.M. and EMC Said to Be Interested in So! ftLayer  |  A deal for SoftLayer Technologies could be worth more than $2 billion, Reuters reports.
REUTERS

McKee Foods to Buy Drake’s From Hostess  | 
REUTERS

Morgan Stanley Moves Closer to Buying Out Wealth Management Unit  | 
REUTERS

INVESTMENT BANKING»

Wells Fargo Chief Earns $19.3 Million  |  John Stumpf of Wells Fargo saw his pay increase 8 percent in 2012.
REUTERS

The Pay Quandary for Banks  |  As long as there is always one bank out there willing to bid high, existing pay structures will be hard to change, Dominic Elliott of Reuters Breakingviews writes.
REUTERS BREAKINGVIEWS

New Rules to Give a More Consistent Picture of Bank Size  |  When first-quarter financial statements are out, it should be possible â€" for the firs! t time â€! " to compare the assets of American and European banks, Floyd Norris, a columnist for The New York Times, writes. “Their balance sheets will still be radically different, but for those who care, the comparison will be possible.”
NEW YORK TIMES

Amid Rush for Corporate Bonds, a Word of Caution  |  Investors seem to love junk bonds, but “nobody really knows just how vulnerable the sector is to a sudden capital flight,” Gillian Tett of The Financial Times writes. “In the meantime, we had all better hope that those corporate debt markets remain benign; and that investors do not entirely forget that 2007 lesson about maturity mismatches.”
FINANCIAL TIMES

A New Trade Group for Structured Finance  | 
BLOOMBERG NEWS

Executive at Schroders in Britain Resigns  | 
FINANCIAL TIMES

PRIVATE EQUITY »

While Raising Money, Valuing a Portfolio Generously  |  A report about private equity firms from University of Oxford researchers f! ound that! “valuations of remaining portfolio companies, and therefore reported returns, are inflated during fund-raising,” according to Fortune.
FORTUNE

Bain’s Bet on Retail Looks Less Promising  |  Bain Capital “doubled down on specialty retailers just as they were about to be pummeled by the likes of Amazon.com,” Bloomberg News reports.
BLOOMBERG NEWS

Carlyle Founders Earn a Combined $172 Million in Dividends  |  But total compensation for the three men last year was reduced.
WALL STREET JOURNAL

HEDGE FUNDS »

More Hedge Funds Shut Their Doors  |  The Financial Times reports: “The number of hedge funds going out of business rose for the third year in a row in 2012, according to HFR, a data provider. Last year, 873 funds failed or closed their doors out of the estimated 9,800 total, against 775 in 2011 and 743 in 2010.”
FINANCIAL TIMES

I.P.O./OFFERINGS »

Inv! estors Line Up for a Piece of Thai Infrastructure I.P.O.  |  Institutional investors signed on to receive allocations in the I.P.O. of a BTS Group Holdings fund, which is aiming to raise up to $2.1 billion, according to Reuters.
REUTERS

VENTURE CAPITAL »

Demise of Google Reader Causes a Stir Online  |  Some bloggers said Google was making a mistake in shutting down its Reader.
NEW YORK TIMES BITS

Dig Says It’s Building a Reader of Its Own  | 
DIGG

LEGAL/REGULATORY »

A Bankruptcy Lawyer for Detroit  |  Kevyn Orr, a partner at Jones Day, was named on Thursday the emergency manager overseeing operations in Detroit, tasked with bringing the city back from the edge of financial ruin.
NEW YORK TIMES

Longtime Critic of Japan’s Central Bank Takes the Helm  |  Haruhiko Kuroda, who was approved on F! riday to ! become the next Bank of Japan governor, “will need more than Aristotelian logic to turn years of the central bank’s policies on their head,” The New York Times writes.
NEW YORK TIMES

Sexual Harassment Lawsuit Filed Against Prominent Plaintiffs’ Lawyer  |  A former junior lawyer at the firm filed a lawsuit against Faruqi & Faruqi on Wednesday, accusing one of its most prominent partners of sexual harassment.
DealBook »

At This Conference, Gensler Is Strictly Ballroom  |  Gar Gensler, a man more at home arguing the fine points of position limits or swaps reform, caught Tuesday Night Fever at the Futures Industry Association’s annual conference held in Boca Raton, Fla.
DealBook »

Consultant Gets One Year in Insider Trading Case  |  Tai Nguyen, who admitted to passing illegal tips to a former SAC Capital Advisors fund manager and others, was sentenced to one year and one day in prison, Bloomberg News reports.
BLOOMBERG NEWS

Lenders Ask Greece for More Cuts  |  On Thursday, “the Greek government tried! to figur! e out how to meet one of the troika’s toughest requirements: designating 25,000 of the country’s 650,000 or so civil servants for eventual dismissal,” The New York Times writes.
NEW YORK TIMES

JPMorgan Faulted Over Trading Loss

JPMORGAN FAULTED OVER TRADING LOSS  |  Congressional investigators on Thursday released a harsh portrait of the events surrounding JPMorgan Chase’s huge trading loss last year, saying the bank ignored internal risk controls while its chief executive, Jamie Dimon, briefly withheld some information from regulators. The 300-page report is sure to escalate the debate over policing Wall Street, and it may foreshadow a criminal case against employees at the center of the trading disaster, Jessica Silver-Greenberg and Ben Protess report in DealBook. Current and former JPMorgan executives, including Ina Drew, who led the office that oversaw the trades, are scheduled to testify at a hearing starting at 9:30 a.m., which DealBook will be live-blogging.

A spokeswoman for the bank said: “While we have repeatedly acknowledged significant mistakes, our senior management acted in good faith and never had any intent to mislead anyone.” Mr. Dimon, who once was heralded as an astute manager of risk, is severely criticized in the report. He approved changes to an internal alarm system that underestimated losses, seemingly in contrast to the chief executive’s earlier statements to lawmakers, the report says. Mr. Dimon is also accused of withholding from regulators details about the losses and then raising his voice at a deputy who later provided the information.

“While people close to the matter dispute whether the outburst actually happened, it illustrates a broader problem ! at JPMorgan,” DealBook writes. “After emerging from the financial crisis in far better shape than rivals, the bank saw itself as being above its regulators. The bank was so filled with hubris, Senate investigators said, that an executive once screamed at examiners and called them ‘stupid.’” The report cites some of the private documents now being examined by the Federal Bureau of Investigation.

As with past investigations, the Senate report includes a trove of internal communications at the bank. Among the details: In mid-March last year, a low-level trader started tracking on a spreadsheet the difference between the bank’s favorable valuations of derivatives and the midpoint prices, enabling the traders to hide losses, according to the report. Bruno Iksil, the trader known as the London Whale, told his manager via instant message that the difference “has increased to 300 now,” eaning $300 million, later adding that it could grow to “1000,” or $1 billion. One colleague responded “ouch,” to which Mr. Iksil said, “well that is the pace.”

GOLDMAN AND JPMORGAN MUST REDO CAPITAL PLANS  |  The Federal Reserve said on Thursday that Goldman Sachs and JPMorgan Chase were not strong enough to go ahead with plans to pay out billions of dollars to shareholders, telling the banks to resubmit their proposals. In contrast, Citigroup and Bank of America, two of the most troubled banks after the financial crisis, got a green light for their plans, DealBook’s Peter Eavis writes.

“The Fed’s rebuke to Goldman and JPMorgan highlights growing tension as regulators try to make sure banks are better prepared for the next market shock. With profits improving, financial ! instituti! ons want to enrich investors by increasing dividends and buying back shares. But regulators want banks to be cautious with their capital, in case of future losses.”

Goldman and JPMorgan, which had been expected by analysts to gain approval for their plans, now have to address the shortcomings and resubmit their plans by the end of September.

AU REVOIR, LASRY  |  Rumors had buzzed around Wall Street for months that Marc Lasry, the billionaire chief executive of Avenue Capital, would be named ambassador to France after supporting President Obama in his re-election campaign. Now, it appears that Bill Clinton may have spilled the beans.

At a fund-raising event on Wednesday, the former president said that Mr. Lasry “got some good news” earlier that day, adding that he was informed he was the new ambassador to France, according to a report by Politico. Mr. Clinton “had asked the president to consider” the appointment, Politico says, citing an unidentified person. If Mr. Lasry indeed has the job, it’s unlikely that his hedge fund would be significantly affected, Absolute Return reported earlier.

ON THE AGENDA  |  The consumer price index for February is out at 8:30 a.m., and data on industrial production that month is out at 9:15 a.m. Alan Greenspan is on CNBC at 7:30 a.m. H. Rodgin Cohen, senior chairman at Sullivan & Cromwell, is on Bloomberg TV at 7:30 a.m. An interview with Erin Callan, the former chief financial officer of Lehman Brothers, airs on NBC’s “Rock Center” at 10 p.m.

GEITHNER’S CRISIS TELL-ALL  |  Timothy F. Geithner is preparing to tell his side of what happened during the financial crisis and the recession, with a book coming in 2014, his publisher said on Thursday. The former Treasury secretary (who was president of the New York Fed during the depths of the crisis) “will aim to answer the most important - and to many the most troubling - questions about the choices he and his colleagues made,” Crown Books, an imprint of Random House, said in a release. The Media Decoder blog notes that Mr. Geithner is “uniquely situated to provide inside information on decision making.”

Mergers & Acquisitions »

Anschutz Calls Off Sale of Entertainment Arm  |  The investment company owned by the billionaire Philip Anschutz has decided to call off efforts to sell the Anschutz Entertainment Group, a sports and live entertainment juggernaut.
DealBook »

Deal-Making Seen in Time Inc.’s Future  |  With an estimated enterprise value of about $3.9 billion, the magazine spinoff from Time Warner could look at a range of possible deals, analysts said, according to Bloomberg News.
BLOOMBERG NEWS

I.B.M. and EMC Said to Be Interested in So! ftLayer  |  A deal for SoftLayer Technologies could be worth more than $2 billion, Reuters reports.
REUTERS

McKee Foods to Buy Drake’s From Hostess  | 
REUTERS

Morgan Stanley Moves Closer to Buying Out Wealth Management Unit  | 
REUTERS

INVESTMENT BANKING»

Wells Fargo Chief Earns $19.3 Million  |  John Stumpf of Wells Fargo saw his pay increase 8 percent in 2012.
REUTERS

The Pay Quandary for Banks  |  As long as there is always one bank out there willing to bid high, existing pay structures will be hard to change, Dominic Elliott of Reuters Breakingviews writes.
REUTERS BREAKINGVIEWS

New Rules to Give a More Consistent Picture of Bank Size  |  When first-quarter financial statements are out, it should be possible â€" for the firs! t time â€! " to compare the assets of American and European banks, Floyd Norris, a columnist for The New York Times, writes. “Their balance sheets will still be radically different, but for those who care, the comparison will be possible.”
NEW YORK TIMES

Amid Rush for Corporate Bonds, a Word of Caution  |  Investors seem to love junk bonds, but “nobody really knows just how vulnerable the sector is to a sudden capital flight,” Gillian Tett of The Financial Times writes. “In the meantime, we had all better hope that those corporate debt markets remain benign; and that investors do not entirely forget that 2007 lesson about maturity mismatches.”
FINANCIAL TIMES

A New Trade Group for Structured Finance  | 
BLOOMBERG NEWS

Executive at Schroders in Britain Resigns  | 
FINANCIAL TIMES

PRIVATE EQUITY »

While Raising Money, Valuing a Portfolio Generously  |  A report about private equity firms from University of Oxford researchers f! ound that! “valuations of remaining portfolio companies, and therefore reported returns, are inflated during fund-raising,” according to Fortune.
FORTUNE

Bain’s Bet on Retail Looks Less Promising  |  Bain Capital “doubled down on specialty retailers just as they were about to be pummeled by the likes of Amazon.com,” Bloomberg News reports.
BLOOMBERG NEWS

Carlyle Founders Earn a Combined $172 Million in Dividends  |  But total compensation for the three men last year was reduced.
WALL STREET JOURNAL

HEDGE FUNDS »

More Hedge Funds Shut Their Doors  |  The Financial Times reports: “The number of hedge funds going out of business rose for the third year in a row in 2012, according to HFR, a data provider. Last year, 873 funds failed or closed their doors out of the estimated 9,800 total, against 775 in 2011 and 743 in 2010.”
FINANCIAL TIMES

I.P.O./OFFERINGS »

Inv! estors Line Up for a Piece of Thai Infrastructure I.P.O.  |  Institutional investors signed on to receive allocations in the I.P.O. of a BTS Group Holdings fund, which is aiming to raise up to $2.1 billion, according to Reuters.
REUTERS

VENTURE CAPITAL »

Demise of Google Reader Causes a Stir Online  |  Some bloggers said Google was making a mistake in shutting down its Reader.
NEW YORK TIMES BITS

Dig Says It’s Building a Reader of Its Own  | 
DIGG

LEGAL/REGULATORY »

A Bankruptcy Lawyer for Detroit  |  Kevyn Orr, a partner at Jones Day, was named on Thursday the emergency manager overseeing operations in Detroit, tasked with bringing the city back from the edge of financial ruin.
NEW YORK TIMES

Longtime Critic of Japan’s Central Bank Takes the Helm  |  Haruhiko Kuroda, who was approved on F! riday to ! become the next Bank of Japan governor, “will need more than Aristotelian logic to turn years of the central bank’s policies on their head,” The New York Times writes.
NEW YORK TIMES

Sexual Harassment Lawsuit Filed Against Prominent Plaintiffs’ Lawyer  |  A former junior lawyer at the firm filed a lawsuit against Faruqi & Faruqi on Wednesday, accusing one of its most prominent partners of sexual harassment.
DealBook »

At This Conference, Gensler Is Strictly Ballroom  |  Gar Gensler, a man more at home arguing the fine points of position limits or swaps reform, caught Tuesday Night Fever at the Futures Industry Association’s annual conference held in Boca Raton, Fla.
DealBook »

Consultant Gets One Year in Insider Trading Case  |  Tai Nguyen, who admitted to passing illegal tips to a former SAC Capital Advisors fund manager and others, was sentenced to one year and one day in prison, Bloomberg News reports.
BLOOMBERG NEWS

Lenders Ask Greece for More Cuts  |  On Thursday, “the Greek government tried! to figur! e out how to meet one of the troika’s toughest requirements: designating 25,000 of the country’s 650,000 or so civil servants for eventual dismissal,” The New York Times writes.
NEW YORK TIMES

Goldman Names M.&A. Capital Markets Head

Goldman Sachs has named Steven Barg, currently co-head of investment banking in South East Asia, to head mergers and acquisitions capital markets in New York. He will work with clients “on the equity market implications of strategic activities,” according to an internal memo.

Mr. Barg, an American, will relocate early next month to New York from Singapore, where he had moved just last year. He was previously co-head of equity capital markets for Asia excluding Japan and was based in Hong Kong.

He joined Goldman as a partner in 2010 from UBS, where he had been head of global capital markets for Asia for two years. Before UBS, he worked at Credit Suisse in New York and London.A 1984 graduate of Wesleyan University, Mr. Barg earned an M.B.A. at Stanford University.