The Best Daily Show So far

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More brazen than Madoff?

Of all the frauds that have come to light in this season of financial pain, none can match the brazen theatricality of the scam allegedly pulled off by superlawyer Marc Dreier।

(Fortune Magazine) -- In a year of fabulous frauds, the one that glitzy Manhattan attorney Marc Dreier has been charged with is in some ways the most fabulous of all.
Not the biggest, of course. The biggest fraud of 2008 was metaphorical: the nation's economy itself, which had been built upon house-of-cards financial products. The most tragic fraud of the year was Bernie Madoff's decades-long Ponzi scheme, which gulled charities, widows, and orphans out of tens of billions of dollars while whistleblowers blew themselves hoarse before deaf and dumb regulators.
Yet Dreier's comparatively modest, alleged $700 million fraud, which left victims with $400 million in losses, was sui generis. What differentiated it from the pack was that it was just so much more - well, we don't want to use the precise word that comes to mind, but "brazen," "cheeky," and "cocky" begin to capture it.
0:00 /2:20Marc Dreier's fabulous fraud
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While Madoff did his dirty work in seclusion behind locked doors, Dreier allegedly duped his victims with the theatrical, improvisational daring of a high-wire aerialist. Despite the pain his crimes have wrought, a dark side in each of us cannot but admire the sheer nerve of the man. (Think of Leonardo DiCaprio's heroic impostor in the film "Catch Me If You Can.")
0:00 /3:45Financial frauds ruin lives
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According to prosecutors, for more than four years Dreier sold hundreds of millions of dollars' worth of bogus debt obligations to nearly 40 investment funds run by 13 of the nation's most sophisticated asset managers, including the likes of Fortress Investment Group, Elliott Associates, and hedge funds later acquired by Perella Weinberg Partners and Blackstone Group. Throughout its existence the scheme could have collapsed at any instant, if just one of dozens of duped hedge fund officials had ever run into real estate developer Sheldon Solow - the head of the duped company supposedly issuing most of the notes - at a cocktail party.
As Dreier dug himself ever deeper into criminality and debt, he resorted to ever more desperate measures to postpone the day of reckoning. He and his accomplices talked their way past receptionists of companies they weren't affiliated with; plopped themselves down in empty conference rooms; and then hosted meetings at which they pretended to be people they weren't. The scam succeeded for as long as it did because none of his victims could conceive that anyone of Dreier's stature would act with such monumental recklessness, selfishness, and self-destructiveness.
Almost as an afterthought, Dreier is alleged to have filched about $40 million from his clients' escrow accounts - including $10 million that he stole after his arrest before authorities could get a receiver appointed to seize control of his law firm and ambulance it into bankruptcy. To the 260 innocent attorneys who toiled for him at Dreier LLP's tony offices in Manhattan, Albany, N.Y., Los Angeles, Pittsburgh, Santa Monica, and Stamford, Conn., Dreier bequeathed unpaid salary checks, unreimbursed expenses, lapsed malpractice and health insurance policies, potential civil liability, and untold damage to reputations. An attorney's stock in trade is sound judgment and wise counsel. "To have hitched one's star to a thief," as a lawyer for one of Dreier's former partners puts it, is a stain that won't easily wash out. Most of Dreier's betrayed former colleagues did not return calls or e-mails, and all but one of those who did asked not to be identified.
Dreier is now under house arrest at his terraced condominium in Midtown Manhattan while awaiting disposition of federal wire fraud, securities fraud, and money-laundering charges that, according to federal prosecutors, merit a prison term of 30 years to life under sentencing guidelines. Though Dreier has pleaded not guilty, he has filed affidavits in court that admit major portions of the accusations against him. His heavy-duty criminal-defense attorney, Gerald Shargel - whose previous clients include bosses of four of New York's five Mafia families - has acknowledged in court that he expects Dreier's case to be "resolved" without trial within a month or two. Dreier's $40 million art collection; his sleek, 121-foot Heesen motor yacht; his waterfront Hamptons mansion; his Aston Martin, BMW, two Mercedes, four Yamaha WaveRunners, and every other gilded trophy he once flaunted are now frozen by court order, awaiting either forfeiture to the government or distribution among creditors.
Dreier appears to have only two remaining possessions of value, and it's unclear whether New York's Son of Sam laws let him exploit them: They are the book and movie rights to the unbelievable yarn that was his life until his arrest on Dec. 2.
***
In March 2007 a Dreier LLP partner wanted to recruit matrimonial attorney Heidi Opinsky to join the firm. So he took her to meet Marc Dreier at the firm's New York City headquarters.
"You came into a very opulent, private entrance," Opinsky recalls. "Separate elevator bank, separate concierge. It was like walking into a museum of modern art. I've never been in a law office that was like this. It made you feel wonderful."
Then things went downhill. "All his little helpers escorted" her into Dreier's office, she says, but Dreier himself she found to be outlandishly distracted and self-absorbed. "He showed that kind of lack of interest where you can tell they're in another world. They're not really hearing what you're saying." When Opinsky got home, she says, she told her husband it had been like "going in to see the Wizard of Oz. I got a feeling of smoke and mirrors. I couldn't put a handle on it." Opinsky did not join the firm.
Though others reacted to Dreier more positively, their accounts set the same harmonic overtones vibrating.
"I liked him," says Joe Pastore, who headed Dreier's Stamford office. "He was kind and warm. A very affable, capable, intelligent, charming guy. Impeccably dressed." But Pastore adds sadly, "There was a distance I could never pierce through. He'd invite you to his house, but he would not come to your house and sit with your kids at a barbecue. He had little interest in my life."

MY LOVE AFFAIR WITH E*TRADE

So I recently moved my Brokerage account from Trademonster।com to Etrade.com, let me just say that it is a much more sophisiticated trading and investing entity. Etrade .com has a very user-friendly interface and highly advanced trading tools right there at your fingertips. I love the fact that Etrade gives me the ability to trade with the same tools the big boys use at no extra cost, no disrespect to the guys over at Trademonster but Etrade gives me more bang for my buck.... Iknow, I know, Etrade is a huge company with millions of clients and therefore tend to overlook the little guys, but I say that is a good thing esspecially if you know what you are doing. You see my dear investors, Etrade is a world class brokerege firm / bank with a big market cap but a young heart. These guys have an exceptional technological infrastructure and unbeatable customer service and dont get me started on their trading platforms॥ these guys have got it right to a freaking "T". I went out and bought 1000 shares in the company after touring their website. इ love it.

US Stocks Slide On Earnings Worries; Alcoa Down 4.4%

By Peter A. McKay

Stocks slumped Tuesday as investors braced for the start of a new earnings season that many expect to continue to sap the market's strength in the weeks ahead.

The Dow Jones Industrial Average was down 172 points, hurt by declines in 28 of its 30 components. One of the big decliners was aluminum maker Alcoa, whose results due after the closing bell will mark the symbolic start of earnings season. Alcoa is expected to post a loss of 60 cents a share, against earnings of 44 cents a share at the same time a year ago. The company's shares were down 4.4%.

Other market yardsticks slid. The Nasdaq Composite Index was down 1.8%. The S&P 500 was off 2%. All its sectors traded lower, including declines of more than 2% each in basic materials and financials. The first quarter is likely to show earnings at S&P 500 companies declined 37%, according to Thomson Reuters, the eighth straight decline in quarterly earnings.

Financial stocks remained under pressure after Calyon Securities analyst Mike Mayo said in a report on Monday that recent government efforts to stabilize the financial system won't prevent Wall Street's loan losses from exceeding those of the Great Depression by late 2010. Monday's skid in financial stocks helped lead to the first drop for the broader stock market in five days.

Citigroup, Bank of America and Wells Fargo declined early Tuesday.

"There's definitely another shoe to fall there," said Michael Farr, president of the portfolio-management firm Farr, Miller & Washington, based in Washington. "Everyone is focused on the balance sheets, especially the toxic assets that have been there. But no one is talking about the current loans."

Farr said he has hung onto shares of Goldman Sachs Group and J.P. Morgan Chase lately for the sake of diversification and because he thinks they are strong enough to survive whatever fallout is yet to come in the credit crisis. But he has otherwise eschewed financial stocks and has preferred to place bets in safe-haven corners of the market like health care and consumer staples.

Sun Microsystems shares continued to fall after its deal talks with International Business Machines collapsed over the weekend, sliding 5%. IBM slipped about 1%.

Overseas, stocks were mostly lower. Japan's Nikkei 225 Average ended down 0.3%, ending a four-session winning streak, and Hong Kong's Hang Seng fell 0.5%. European markets gave up early gains to trade lower, with financials in particular coming under pressure.

In currency markets, the dollar fell against the Japanese yen but rose against the euro, which frequently is sign of declining risk appetite. Gold futures rose and yields on 10-year Treasury bonds fell. Crude-oil futures slipped to about $50 a barrel.

Stanford vows to fight 'with everything in me'

Native Texan R. Allen Stanford told ABC News that fraud allegations against him and his Stanford Financial Group companies are “baloney,” according to a report aired Monday night.


In what the network said was Stanford’s first media interview since the Securities and Exchange Commission filed the civil fraud complaint, Stanford also denied the SEC’s allegation that he and co-defendants operated a Ponzi scheme — in which early investors are paid with money from later ones.

“I would die and go to hell if it’s a Ponzi scheme,” Stanford said in what appeared to be an unplanned run-in with a television crew in Houston. “It’s not a Ponzi scheme. If it was a Ponzi scheme, why are they finding billions and billions of dollars all over the place?”

In February the SEC filed a civil suit against Houston-based Stanford Financial Group, Antigua-based Stanford International Bank and three top executives including Stanford, alleging an $8 billion fraud. Accounts and assets tied to the brokerage, bank and individuals were frozen by court order throughout the U.S. and overseas.

The separate court-appointed receivers for the Stanford companies in the U.S. and Antigua have said there appears to be less than $1 billion in assets tied to the bank based on the property and bank accounts they’ve recovered so far.

Stanford, who so far only faces a civil complaint, also told the network that he expects to be indicted within the next two weeks, but intends to challenge the allegations. “I’m going to fight this with everything in me,” he said.

Dick DeGuerin, a Houston criminal defense lawyer Stanford hopes to hire, said he has not seen the ABC interview, which he said occurred at a Houston hotel last week.

“It was a chance encounter and he lost his temper. He felt bad about that and trying to make up for it, he went on and on,” DeGuerin said.

He said he’s not as sure as Stanford that an indictment is imminent. “It could go quickly but if they really examine what happened, there will be no indictment,” DeGuerin said.

DeGuerin said Stanford was emotional in the ABC interview, in which he sometimes was tearful, because of his anger over what’s happened to the business he built for 20 years.

“The SEC caused a run on his banks, they caused banks to be nationalized in other countries,” said DeGuerin. “The SEC has done more damage to the Stanford companies than the stock market crash did.”

Freeze on assets extended


In other action in the case Monday, a London court granted the SEC an extended freeze on U.K.-based assets tied to Stanford Financial Group, including more than $100 million in equities and cash.

The High Court in London signed an order freezing the assets through April 27, which, according to court documents, includes about $105 million in assets held in Credit Suisse accounts and $5 million more in accounts at HSBC.

Court-appointed receivers have been searching all over the world for assets tied to the Stanford bank in Antigua. A lawyer representing Stanford Chief Financial Officer James Davis, who also was named in the SEC suit, says his client has been helping the SEC and the Department of Justice in their dealings with European banks.

“We are hopeful that additional assets, particularly with a Swiss flavor, will be located to help compensate the investors,” attorney David Finn said.

According to court papers, Credit Suisse has Stanford accounts with about $97.5 million in hedge fund investments, $1 million in cash, $5.4 million in Swiss franc shares and other assets.

The HSBC accounts contained an additional $5 million in euros, English pounds, Swiss francs and U.S. dollars.

Credit Suisse had instructions to liquidate the entire London portfolio in early February, just before the SEC filed its case, according to court papers, and on Feb. 12 received an order to wire $17 million to Stanford International Bank accounts in Houston. According to the court documents, the bank didn’t carry out the orders.

Unusual Trading Volume at RadioOne

First off let me say that I own shares of Radio One Inc. ( Public, NASDAQ:ROIA ). I have always been a true believer in this company for a number of reasons; 1. Its a media company catering to African Americans and unlike BET or the other so called Urban media companies, Radio One is not only focused on milking blacks for every dime they earn but also to educate and empower black youth.

2. I love the company's founder; Catherine Hughes, I believe she is the picture of a strong intelligent black woman who picked herself up by her bootstraps to build a very relevant media empire.

I bought Radio One at $ 0.57 a share a few months ago. I also took a few protective measures a week ago when the stock hit $0.68 in case things went bad and the stock price tumbled again. I have recently seen the stock go from $0.68 to $1.33 and back down to $0.68. The stock has very light trading volume and such volatility scares the heck out of me.

I believe the stock price is being manipulated by traders and other speculators. I say to my fellow small cap investors to be cautious when taking a position in this stock, take profits off the top and invest in options techniques to protect your investments.