Gone "Missing" -- $8.9 Billion in FTX Customer Funds

FTX Says $8.9 Billion in Customer Funds Are Missing

FTX says it has identified a deficit of $8.9 billion in customer funds that it can’t account for, the first time the bankrupt cryptocurrency exchange has pinned down how much money has gone missing.

In a public presentation released on Thursday, FTX said it had identified around $2.7 billion of customer assets, compared with $11.6 billion of balances outstanding on customer accounts. The estimated value of FTX’s assets and liabilities are based on crypto prices on the day of the company’s bankruptcy filing in early November.

U.S. Senators Press Binance on U.S. Users, Finances, Money-Laundering Controls

A bipartisan group of senators accused the world’s largest crypto exchange, Binance, of being “a hotbed of illegal financial activity” and asked the company to respond to a list of questions.

“Binance and its related entities have purposefully evaded regulators, moved assets to criminals and sanctions evaders, and hidden basic financial information from its customers and the public,” Sens. Elizabeth Warren (D., Mass.), Chris Van Hollen (D., Md.) and Roger Marshall (R., Kan.) wrote in a letter late Wednesday.

SEC Chair Gensler Says Crypto Exchanges May Not Be ‘Qualified Custodians’

Speaking at an Investor Advisory Committee meeting Thursday, Gensler said a recently proposed rule directing investment advisers to look to qualified custodians for storage of assets – including cryptocurrencies – makes “important enhancements” to existing protection rules. He also said crypto exchanges should not be considered safe under those guidelines.

“Based upon how crypto trading and lending platforms generally operate, investment advisers cannot rely on them today as qualified custodians,” Gensler said. “To be clear: Just because a crypto trading platform claims to be a qualified custodian doesn’t mean that it is.”

Message Received: How to View SEC’s Off-Channel Communications ProbeFinancial firms have two options to address the regulatory requirements, according to Nick Morgan, a partner in the litigation department at law firm Paul Hastings: Implement technology to keep records on more channels, or restrict which channels are permitted.

“Either you’re capturing more or you’re talking less,” said Morgan, who previously served as senior trial counsel in the SEC’s Enforcement Division.

Jim Cramer ETFs Arrive to Bet On, Against Mad Money Host’s Picks

Whether you’re a lover or loather of Jim Cramer — and on both Wall Street and Main Street, there are plenty of each — you’re now able to express that view via the magic of ETFs.

A pair of new products is launching Thursday that will help US investors bet either on or against the stock picks of the host of CNBC’s Mad Money show, arguably the world’s most-famous financial pundit.

The Inverse Cramer Tracker ETF (ticker SJIM) seeks to deliver returns that correspond to “the inverse of securities mentioned by Cramer” by either short-selling his equity picks or buying companies he recommends against, according to its prospectus.

Meanwhile, the Long Cramer Tracker ETF (LJIM) will back shares the CNBC anchor likes and ditch the ones he doesn’t.

Trillions at Stake as 401(k)s Become ESG Political Footballs

normous amounts of executive and legislative political power in Washington are being spent in the clash over a whether private-sector retirement plans can even consider environmental or social impacts in the investments they choose. Regulators are facing at least two federal lawsuits in Texas and Wisconsin challenging their authority to promulgate that kind of rule in the first place while states crack down on public pensions that contract with environmentally friendly managers.

Some of that adversity came to a head late Wednesday when Senate Republicans convinced two moderate Democrats up for reelection next year to support passing a House resolution that would bar the US Labor Department from continuing to enforce its worker benefit rule. The president has pledged to veto it.

Ericsson to pay $206 million fine, plead guilty to bribery violations

Swedish telecommunications giant Ericsson agreed to pay a $206 million penalty and pleaded guilty to violating the anti-bribery provisions of the Foreign Corrupt Practices Act, U.S. prosecutors announced Thursday evening.

Ericsson had already paid a $520.6 million penalty in 2019 over what New York federal prosecutors said was a “yearslong campaign of corruption,” involving the bribery of government officials and the falsification of books and records in Djibouti, China, Vietnam, Indonesia and Kuwait. Additionally, the company paid about $540 million to the Securities and Exchange Commission.

Former SEC Chairs Stress Need for Board, Workforce Diversity

Mary Jo White, an Obama appointee who led the SEC from 2013 to 2017, offered another way to nudge companies to improve diversity: having the SEC personally meet with heads of companies to try and get them to make such disclosures.

“I would go and rattle a few cages,” she said. “I would also identify, if I could, leaders of some of those registrants who actually are disclosing, doing a good job, or would if you nudged them, and have them help you go out with your outreach to the others.”

When asked if there has been enough progress on diversity in the financial services industry, White said: “Not enough.”