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More Collateralized “Death” Obligations

Roberto Calvi's Corpse: Was "God's Banker" setting a trend?

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COMMENT: “Participo” alerts us to an article from The New York Post updating the mortality rate in the financial industry. Although the Post–once a very good newspaper, now a Murdoch sheet–spins the story in a snide sort of way, it is more than a little interesting to see the stunning casualty rate in the financial industry.

These deaths are occurring as numerous investigations are underway into various kinds of malfeasance in the global financial sector, manipulation of the foreign exchange rate, in particular.

We notice that Richard Talley was omitted from the list. Talley, you will recall, allegedly killed himself with seven or eight shots from a nail gun in the head and torso. 

Perhaps the editors felt that not even “Murdochians” would buy that one. Or, perhaps, the investigation into Talley’s death was reclassified as a homicide case.

Long live the Republic!

UPDATE: “Pterrafractyl” contributes the death of yet another JP Morgan executive.

“String of Sui­cides Rock­ing Finan­cial World Baf­fles Experts” by Michael Gray; New York Post; 3/18/2014.

EXCERPT: The finan­cial world has been rat­tled by a rash of appar­ent sui­cides, with some of the best and bright­est among the finance work­ers who have taken their lives since the start of the year.

A major­ity of the eight sui­cides of 2014 have been very pub­lic demon­stra­tions, which has suicide-prevention experts puzzled.

“Jump­ing is much less com­mon as a method for sui­cide in gen­eral, so I am struck by the num­ber that have occurred in recent months in this indus­try,” said Dr. Chris­tine Moutier, chief med­ical offi­cer of the Amer­i­can Foun­da­tion for Sui­cide Prevention.

Moutier also dis­counts the loca­tion of the act as being the dri­ver behind the rea­son for the suicide.

“The suicide-research lit­er­a­ture doesn’t help very much with the ques­tion of why the method of these sui­cides is so out in the open,” she added.

MARCH 12: Ken­neth Bel­lando, 28, an invest­ment banker at Levy Cap­i­tal, was found dead on the side­walk out­side his build­ing on Manhattan’s East Side, after allegedly jump­ing from the sixth-story roof, sources said.

MARCH 11: Edmund (Eddie) Reilly, 47, a trader at Midtown’s Ver­ti­cal Group, jumped in front of an LIRR train near the Syos­set, NY, train station.

FEB. 28:  Autumn Radtke, CEO of First Meta, a cyber-currency exchange firm, was found dead out­side her Sin­ga­pore apart­ment. The 28-year-old Amer­i­can jumped from a 25-story build­ing, author­i­ties said.

FEB. 18: Li Jun­jie, a 33-year-old JPMor­gan finance pro, leaped to his death from the roof of the company’s 30-story Hong Kong office tower, author­i­ties said.

FEB. 3: Ryan Henry Crane, 37, a JPMor­gan exec­u­tive direc­tor who worked in New York, was found dead inside his Stam­ford, Conn., home. A cause of death in Crane’s case has yet to be deter­mined as author­i­ties await a tox­i­col­ogy report, a spokesper­son for the Stam­ford Police Depart­ment said.

JAN. 31: Mike Dueker, 50, chief econ­o­mist at Rus­sell Invest­ments and a for­mer Fed­eral Reserve bank econ­o­mist, was found dead at the side of a road that leads to the Tacoma Nar­rows Bridge in Wash­ing­ton state after jump­ing a fence and falling down an embank­ment, accord­ing to the Pierce County Sheriff’s Department.

JAN. 28: Gabriel Magee, 39, a vice pres­i­dent with JPMorgan’s cor­po­rate and invest­ment bank tech­nol­ogy arm in the UK, jumped to his death from the roof of the bank’s 33-story Canary Wharf tower in London.

JAN. 26: William Broeksmit, 58, a for­mer senior risk man­ager at Deutsche Bank, was found hanged in a house in South Kens­ing­ton, accord­ing to Lon­don police.

“Vet­eran Cyclist Killed by Mini­van Knew the Dan­gers All Too Well” by Bill Bush; The Colum­bus Dis­patch; 3/24/2014.

EXCERPT: About a decade ago, Jeff Stephens was bicy­cling shoulder-to-shoulder with Joseph A. Giampapa when the two wit­nessed another cyclist get fatally struck by a car right in front of them.

“It was sort of a bond that we had, and I would say it’s a bur­den that we car­ried,” Stephens said yes­ter­day. “We were in very close con­tact for months after that situation.”

On Sat­ur­day, Stephens, of Wor­thing­ton, got a phone call from the scene of another acci­dent — this time, it was Giampapa who had been struck by a mini­van and killed while bicy­cling north of Troy.

Giampapa, 56, of the North­west Side, was an accom­plished long-distance cyclist and cor­po­rate attor­ney for JPMor­gan Chase in Colum­bus. He was a long­time res­i­dent of Vic­to­rian Vil­lage who had moved with his wife, Thelma, into a con­do­minium near Dublin about two years ago.

He was able to ride his bike thou­sands of miles in short peri­ods of time and cov­ered some of the most dif­fi­cult ter­rain in bik­ing, includ­ing the same Alpine routes used in the Tour de France, his friends said yesterday.

“He rode many of the famous climbs in the Alps” in both France and Italy, said Greg DuBois, 59, of Wor­thing­ton, who had trav­eled with Giampapa on his excursions.

“He could just ride phe­nom­e­nal dis­tances with­out stop­ping and with­out get­ting tired.”

Giampapa was bik­ing north on Troy-Sidney Road, near Loy Road, out­side of Piqua just after 11 a.m. Sat­ur­day when a mini­van struck him from behind, Miami County Deputy Todd Ten­nant said. Giampapa was pro­nounced dead at the scene.

The mini­van dri­ver, Thomas G. Davis, 78, was at fault, Ten­nant said, but charges haven’t been filed.

Ten­nant said charges are pend­ing the out­come of a blood tox­i­col­ogy test. But it didn’t appear as though Davis was intox­i­cated, he added. All of the evi­dence even­tu­ally will be given to a grand jury, Ten­nant said, but pos­si­bly not until May, depend­ing on how long it takes for the blood sam­ples to be processed.

Giampapa’s friends were at a loss about why he was hit.

“It wasn’t a blind turn,” said David Rod­er­ick of Athens, who helped orga­nize the 200-kilometer (124.3-mile) event from Spring­field to Quincy to Troy and back that Giampapa was par­tic­i­pat­ing in.

“It wasn’t on a hill,” Rod­er­ick said. “You could see rid­ers for a very long distance.”

Discussion

7 comments for “More Collateralized “Death” Obligations”

  1. One more?

    Veteran cyclist killed by minivan knew the dangers all too well
    By Bill Bush The Columbus Dispatch • Monday March 24, 2014 11:19 AM

    About a decade ago, Jeff Stephens was bicycling shoulder-to-shoulder with Joseph A. Giampapa when the two witnessed another cyclist get fatally struck by a car right in front of them.

    “It was sort of a bond that we had, and I would say it’s a burden that we carried,” Stephens said yesterday. “We were in very close contact for months after that situation.”

    On Saturday, Stephens, of Worthington, got a phone call from the scene of another accident — this time, it was Giampapa who had been struck by a minivan and killed while bicycling north of Troy.

    Giampapa, 56, of the Northwest Side, was an accomplished long-distance cyclist and corporate attorney for JPMorgan Chase in Columbus. He was a longtime resident of Victorian Village who had moved with his wife, Thelma, into a condominium near Dublin about two years ago.

    He was able to ride his bike thousands of miles in short periods of time and covered some of the most difficult terrain in biking, including the same Alpine routes used in the Tour de France, his friends said yesterday.

    “He rode many of the famous climbs in the Alps” in both France and Italy, said Greg DuBois, 59, of Worthington, who had traveled with Giampapa on his excursions.

    “He could just ride phenomenal distances without stopping and without getting tired.”

    Giampapa was biking north on Troy-Sidney Road, near Loy Road, outside of Piqua just after 11 a.m. Saturday when a minivan struck him from behind, Miami County Deputy Todd Tennant said. Giampapa was pronounced dead at the scene.

    The minivan driver, Thomas G. Davis, 78, was at fault, Tennant said, but charges haven’t been filed.

    Tennant said charges are pending the outcome of a blood toxicology test. But it didn’t appear as though Davis was intoxicated, he added. All of the evidence eventually will be given to a grand jury, Tennant said, but possibly not until May, depending on how long it takes for the blood samples to be processed.

    Giampapa’s friends were at a loss about why he was hit.

    “It wasn’t a blind turn,” said David Roderick of Athens, who helped organize the 200-kilometer (124.3-mile) event from Springfield to Quincy to Troy and back that Giampapa was participating in.

    “It wasn’t on a hill,” Roderick said. “You could see riders for a very long distance.”

    Assuming this wasn’t an accident but instead a “message” to others, one of the weird risks of that kind of strategy is that it doesn’t just send a “keep you mouth shut and don’t mess with us”-message. It also sends a “we’re the kind of awful human beings that you should be proud to oppose even if it doesn’t end well because, hey, everyone’s going to go someday so you might as well do something meaningful on your way out and do everything you can to oppose horrible people like us”-message. You can’t really separate those two messages.

    Posted by Pterrafractyl | March 28, 2014, 7:00 am
  2. The self-described Robin Hood of Liechtenstein just killed the CEO of Bank Frick and then committed suicide:

    Bloomberg
    Liechtenstein Banker Shot Dead in Reported Investment FeudBy Jan-Henrik Foerster and Paul Verschuur Apr 7, 2014 3:13 PM CT

    A Liechtenstein banker was shot dead after a feud involving an investment fund, and police said they believe the alleged killer later committed suicide.

    The 48-year-old man was shot in the underground garage of a financial institution in Balzers at 7:30 a.m. local time, the Liechtenstein police said on their website today. Neither the victim nor the institution was identified in the statement. The deceased was Juergen Frick, CEO of Bank Frick & Co. AG, according to Switzerland’s Radio 1, which cited employees of his bank.

    The suspect, Juergen Hermann, fled the scene in a Smart car with Liechtenstein license plates, according to police. The authorities later said Hermann appears to have committed suicide after they found the vehicle in Ruggell, 25 kilometers (16 miles) north of Balzers, with his passport and a confession.

    “Service dogs were able to track the suspect to the banks of the Rhine,” police said in a statement. “Clothing belonging to the suspect was found there. Because of the circumstances and the evidence, suicide has to be assumed.

    Calls to Bank Frick were answered by a voice-mail message saying the company is closed because of “a death.” It gave no further details. A police spokesman didn’t immediately respond to telephone calls and e-mails seeking comment.
    Prime Minister

    Bank Frick & Co., founded in 1998, specializes in wealth management and investment advice. The firm managed about 3.5 billion Swiss francs ($3.9 billion) of assets on behalf of clients at the end of 2012, according to its website. The company’s chairman is Mario Frick, who was prime minister of Liechtenstein from 1993 to 2001.

    Bank Frick was previously partly owned by Bawag PSK Bank AG, the Austrian lender that almost collapsed because of its links with failed U.S. futures firm Refco Inc. Bawag owned 26 percent and Refco had a 4 percent holding, according to a report by the Austrian Press Agency. After Austria led a bailout of Bawag in 2006, the company sold its stake in Bank Frick, according to a paper published the following year on the European Commission’s website.

    Hermann is a fund manager who has been embroiled in a dispute with the Liechtenstein government and Bank Frick for many years, according to Radio 1.
    Hermann Finance

    The Liechtenstein government and the country’s Financial Market Authority “illegally destroyed my investment company Hermann Finance and its funds, depriving me of my livelihood,” according to a website registered under the name Juergen Hermann of Hermann Finance AG.

    He has filed lawsuits seeking recovery of 200 million Swiss francs from the government and 33 million francs from Bank Frick, according to the website. The lender “illegally enriched itself,” among other alleged crimes, it said.

    A representative of Hermann’s lawyer declined to comment when reached by telephone. A call to an office telephone number listed on Hermann Finance’s website was answered by an employee of a law firm who said his company isn’t related to Hermann Finance.

    Hermann had been “publicly hostile” to the country’s Financial Market Authority and some of its employees, forcing it to take security measures in consultation with the police, FMA spokesman Beat Krieger said in an e-mail today.

    Posted by Pterrafractyl | April 8, 2014, 8:54 am
  3. I think it’s worth mentioning that Jim Flaherty, Canada’s Finance minister until just recently, died suddenly of a heart attack. While no indication of foul play has been noted by any pundits, it’s interesting that he resigned without giving any real reason for doing so and then died so soon after. Could it be he learned of the real aims of his cohorts and possessed dangerous information that made him expendable? He may have sought to represent his constituents in a democratic manner although his politics at one time were only a little to the left of Mussolini. I don’t think this is unreasonable speculation given that Harper is gearing up for another election push while treading through the scandals connected to the Electon Act changes and the recent Senate blow-ups. Many a die-hard right-winger has experienced a similar change of heart.

    Posted by Brad | April 16, 2014, 12:16 pm
  4. 52 Year-Old French Banker Jumps To Her Death In Paris (After Questioning Her Superiors)

    http://www.zerohedge.com/news/2014-04-24/52-year-old-french-banker-jumps-her-death-paris-after-questioning-her-superiors

    Tyler Durden’s picture
    Submitted by Tyler Durden on 04/24/2014 23:38 -0400

    There have been 13 senior financial services executives deaths around the world this year, but the most notable thing about the sad suicide of the 14th, a 52-year-old banker at France’s Bred-Banque-Populaire, is she is the first female.

    As Le Parisien reports, Lydia (no surname given) jumped from the bank’s Paris headquarter’s 14th floor shortly before 10am.

    FranceTV added that sources said “she questioned her superiors before jumping out the window,” but the bank denies it noting that she had been in therpapy for several years.

    FranceTV and Le Parisien reports,

    An employee of the Bred-Banque Populaire has committed suicide, Tuesday, April 22 in the morning at the headquarters of the bank. On her arrival at headquarters, quai de la Rapee, in the 12th arrondissement of Paris…

    The incident occurred shortly before 10 am, 200 meters from the Ministry of Finance.

    According to our sources, she questioned his superiors before jumping out the window, that formally denies the direction of the Bank.

    “There is absolutely no evidence for designating his relationships with his hierarchy as responsible or letter or message ” insists the direction of the communication FranceTV info.

    It also speaks of a “very painful moment for the company” .

    In an email to all employees consulted by FranceTV info, the management of the bank confirms the “death by suicide” and said “severely affected.” It shows have established a psychological unit.

    “For the moment, nothing puts the company in question, says the majority union SUNI-Bred/UNSA. The employee got along very well with her new team, her superior is very nice.

    “According to a close,” Lydia lived alone, in a difficult environment.

    The human resources department states that this inhabitant of Ivry was in therapy for several years. Each describes a “secretive” but “very well known and popular” woman, but “never spoke of it.”

    This is the 14th financial services exective death in recent months…

    1 – William Broeksmit, 58-year-old former senior executive at Deutsche Bank AG, was found dead in his home after an apparent suicide in South Kensington in central London, on January 26th.

    2 – Karl Slym, 51 year old Tata Motors managing director Karl Slym, was found dead on the fourth floor of the Shangri-La hotel in Bangkok on January 27th.

    3 – Gabriel Magee, a 39-year-old JP Morgan employee, died after falling from the roof of the JP Morgan European headquarters in London on January 27th.

    4 – Mike Dueker, 50-year-old chief economist of a US investment bank was found dead close to the Tacoma Narrows Bridge in Washington State.

    5 – Richard Talley, the 57 year old founder of American Title Services in Centennial, Colorado, was found dead earlier this month after apparently shooting himself with a nail gun.

    6 – Tim Dickenson, a U.K.-based communications director at Swiss Re AG, also died last month, however the circumstances surrounding his death are still unknown.

    7 – Ryan Henry Crane, a 37 year old executive at JP Morgan died in an alleged suicide just a few weeks ago. No details have been released about his death aside from this small obituary announcement at the Stamford Daily Voice.

    8 – Li Junjie, 33-year-old banker in Hong Kong jumped from the JP Morgan HQ in Hong Kong this week.

    9 – James Stuart Jr, Former National Bank of Commerce CEO, found dead in Scottsdale, Ariz., the morning of Feb. 19. A family spokesman did not say whatcaused the death

    10 – Edmund (Eddie) Reilly, 47, a trader at Midtown’s Vertical Group, commited suicide by jumping in front of LIRR train

    11 – Kenneth Bellando, 28, a trader at Levy Capital, formerly investment banking analyst at JPMorgan, jumped to his death from his 6th floor East Side apartment.

    12 – Jan Peter Schmittmann, 57, the former CEO of Dutch bank ABN Amro found dead at home near Amsterdam with wife and daughter.

    13 – Li Jianhua, 49, the director of China’s Banking Regulatory Commission died of a sudden heart attack

    14 – Lydia _____, 52 – jumped to her suicide from the 14th floor of Bred-Banque Populaire in Paris

    Average:
    4.68182
    Your rating: None Average: 4.7 (22 votes)

    Posted by participo | April 28, 2014, 2:50 pm
  5. Tyler Durden @ ZeroHedge is on the case:

    Deutsche Bank Lawyer And Former SEC Enforcement Attorney Found Dead In Apparent Suicide

    Submitted by Tyler Durden on 10/25/2014 10:52 -0400

    Back on January 26, a 58-year-old former senior executive at German investment bank behemoth Deutsche Bank, William Broeksmit, was found dead after hanging himself at his London home, and with that, set off an unprecedented series of banker suicides throughout the year which included former Fed officials and numerous JPMorgan traders.

    Following a brief late summer spell in which there was little if any news of bankers taking their lives, as reported previously, the banker suicides returned with a bang when none other than the hedge fund partner of infamous former IMF head Dominique Strauss-Khan, Thierry Leyne, a French-Israeli entrepreneur, was found dead after jumping off the 23rd floor of one of the Yoo towers, a prestigious residential complex in Tel Aviv.

    Just a few brief hours later the WSJ reported that yet another Deutsche Bank veteran has committed suicide, and not just anyone but the bank’s associate general counsel, 41 year old Calogero “Charlie” Gambino, who was found on the morning of Oct. 20, having also hung himself by the neck from a stairway banister, which according to the New York Police Department was the cause of death. We assume that any relationship to the famous Italian family carrying that last name is purely accidental.

    (…. grounds for further genealogy research? – p)

    ….

    As a reminder, the other Deutsche Bank-er who was found dead earlier in the year, William Broeksmit, was involved in the bank’s risk function and advised the firm’s senior leadership; he was “anxious about various authorities investigating areas of the bank where he worked,” according to written evidence from his psychologist, given Tuesday at an inquest at London’s Royal Courts of Justice. And now that an almost identical suicide by hanging has taken place at Europe’s most systemically important bank, and by a person who worked in a nearly identical function – to shield the bank from regulators and prosecutors and cover up its allegedly illegal activities with settlements and fines – is surely bound to raise many questions.

    (…is this the understatement of the year? – p)

    The WSJ reports that Mr. Gambino had been “closely involved in negotiating legal issues for Deutsche Bank, including the prolonged probe into manipulation of the London interbank offered rate, or Libor, and ongoing investigations into manipulation of currencies markets, according to people familiar with his role at the bank.”

    He previously was an associate at a private law firm and a regulatory enforcement lawyer from 1997 to 1999, according to his online LinkedIn profile and biographies for conferences where he spoke. But most notably, as his LinkedIn profile below shows, like many other Wall Street revolving door regulators, he started his career at the SEC itself where he worked from 1997 to 1999.

    Going back to the previous suicide by a DB executive, the bank said at the time of the inquest that Mr. Broeksmit “was not under suspicion of wrongdoing in any matter.” At the time of Mr. Broeksmit’s death, Deutsche Bank executives sent a memo to bank staff saying Mr. Broeksmit “was considered by many of his peers to be among the finest minds in the fields of risk and capital management.” Mr. Broeksmit had left a senior role at Deutsche Bank’s investment bank in February 2013, but he remained an adviser until the end of 2013. His most recent title was the investment bank’s head of capital and risk-optimization, which included evaluating risks related to complicated transactions.

    A thread connecting Broeksmit to wrongdoing, however, was uncovered earlier this summer when Wall Street on Parade referenced his name in relation to the notorious at the time strategy provided by Deutsche Bank and others to allow hedge funds to avoid paying short-term capital gains taxes known as MAPS (see How RenTec Made More Than $34 Billion In Profits Since 1998: “Fictional Derivatives”)

    Clearly Deutsche Bank is slowly becoming Europe’s own JPMorgan – a criminal bank whose past is finally catching up to it, and where legal fine after legal fine are only now starting to slam the banking behemoth. We will find out just what the nature of the latest litigation charge is next week when Deutsche Bank reports, but one thing is clear: in addition to mortgage, Libor and FX settlements, one should also add gold. Recall from around the time when the first DB banker hung himself: it was then that Elke Koenig, the president of Germany’s top financial regulator, Bafin, said that in addition to currency rates, manipulation of precious metals “is worse than the Libor-rigging scandal.”

    …continuing:

    It remains to be seen if Calogero’s death was also related to precious metals rigging although it certainly would not be surprising. What is surprising, is that slowly things are starting to fall apart at the one bank which as we won’t tire of highlighting, has a bigger pyramid of notional derivatives on its balance sheet than even JPMorgan, amounting to 20 times more than the GDP of Germany itself, and where if any internal investigation ever goes to the very top, then Europe itself, and thus the world, would be in jeopardy.

    Posted by participo | October 25, 2014, 8:44 am
  6. http://www.zerohedge.com/news/2014-10-25/deutsche-bank-lawyer-and-former-sec-enforcement-attorney-found-dead-apparent-suicide

    Another Deutsche Banker And Former SEC Enforcement Attorney Commits Suicide

    Submitted by Tyler Durden on 10/25/2014

    Back on January 26, a 58-year-old former senior executive at German investment bank behemoth Deutsche Bank, William Broeksmit, was found dead after hanging himself at his London home, and with that, set off an unprecedented series of banker suicides throughout the year which included former Fed officials and numerous JPMorgan traders.
    Following a brief late summer spell in which there was little if any news of bankers taking their lives, as reported previously, the banker suicides returned with a bang when none other than the hedge fund partner of infamous former IMF head Dominique Strauss-Khan, Thierry Leyne, a French-Israeli entrepreneur, was found dead after jumping off the 23rd floor of one of the Yoo towers, a prestigious residential complex in Tel Aviv.

    Just a few brief hours later the WSJ reported that yet another Deutsche Bank veteran has committed suicide, and not just anyone but the bank’s associate general counsel, 41 year old Calogero “Charlie” Gambino, who was found on the morning of Oct. 20, having also hung himself by the neck from a stairway banister, which according to the New York Police Department was the cause of death. We assume that any relationship to the famous Italian family carrying that last name is purely accidental.

    Here is his bio from a recent conference which he attended:

    Charlie J. Gambino is a Managing Director and Associate General Counsel in the Regulatory, Litigation and Internal Investigation group for Deutsche Bank in the Americas. Mr. Gambino served as a staff attorney in the United Securities and Exchange Commission’s Division of Enforcement from 1997 to 1999. He also was associated with the law firm of Skadden, Arps, Slate Meagher & Flom from 1999 to 2003. He is a frequent speaker at securities law conferences. Mr. Gambino is a member of the American Bar Association and the Association of the Bar of the City of New York.

    As a reminder, the other Deutsche Bank-er who was found dead earlier in the year, William Broeksmit, was involved in the bank’s risk function and advised the firm’s senior leadership; he was “anxious about various authorities investigating areas of the bank where he worked,” according to written evidence from his psychologist, given Tuesday at an inquest at London’s Royal Courts of Justice. And now that an almost identical suicide by hanging has taken place at Europe’s most systemically important bank, and by a person who worked in a nearly identical function – to shield the bank from regulators and prosecutors and cover up its allegedly illegal activities with settlements and fines – is surely bound to raise many questions.

    The WSJ reports that Mr. Gambino had been “closely involved in negotiating legal issues for Deutsche Bank, including the prolonged probe into manipulation of the London interbank offered rate, or Libor, and ongoing investigations into manipulation of currencies markets, according to people familiar with his role at the bank.”

    He previously was an associate at a private law firm and a regulatory enforcement lawyer from 1997 to 1999, according to his online LinkedIn profile and biographies for conferences where he spoke. But most notably, as his LinkedIn profile below shows, like many other Wall Street revolving door regulators, he started his career at the SEC itself where he worked from 1997 to 1999.

    “Charlie was a beloved and respected colleague who we will miss. Our thoughts and sympathy are with his friends and family,” Deutsche Bank said in a statement.

    Going back to the previous suicide by a DB executive, the bank said at the time of the inquest that Mr. Broeksmit “was not under suspicion of wrongdoing in any matter.” At the time of Mr. Broeksmit’s death, Deutsche Bank executives sent a memo to bank staff saying Mr. Broeksmit “was considered by many of his peers to be among the finest minds in the fields of risk and capital management.” Mr. Broeksmit had left a senior role at Deutsche Bank’s investment bank in February 2013, but he remained an adviser until the end of 2013. His most recent title was the investment bank’s head of capital and risk-optimization, which included evaluating risks related to complicated transactions.

    A thread connecting Broeksmit to wrongdoing, however, was uncovered earlier this summer when Wall Street on Parade referenced his name in relation to the notorious at the time strategy provided by Deutsche Bank and others to allow hedge funds to avoid paying short-term capital gains taxes known as MAPS (see How RenTec Made More Than $34 Billion In Profits Since 1998: “Fictional Derivatives”)

    From Wall Street on Parade:

    Broeksmit’s name first emerged in yesterday’s Senate hearing as Senator Carl Levin, Chair of the Subcommittee, was questioning Satish Ramakrishna, the Global Head of Risk and Pricing for Global Prime Finance at Deutsche Bank Securities in New York. Ramakrishna was downplaying his knowledge of conversations about how the scheme was about changing short term gains into long term gains, denying that he had been privy to any conversations on the matter.

    Levin than asked: “Did you ever have conversations with a man named Broeksmit?” Ramakrishna conceded that he had and that the fact that the scheme had a tax benefit had emerged in that conversation. Ramakrishna could hardly deny this as Levin had just released a November 7, 2008 transcript of a conversation between Ramakrishna and Broeksmit where the tax benefit had been acknowledged.

    Another exhibit released by Levin was an August 25, 2009 email from William Broeksmit to Anshu Jain, with a cc to Ramakrishna, where Broeksmit went into copious detail on exactly what the scheme, internally called MAPS, made possible for the bank and for its client, the Renaissance Technologies hedge fund. (See Email from William Broeksmit to Anshu Jain, Released by the U.S. Senate Permanent Subcommittee on Investigations.)

    At one point in the two-page email, Broeksmit reveals the massive risk the bank is taking on, writing: “Size of portfolio tends to be between $8 and $12 billion long and same amount of short. Maximum allowed usage is $16 billion x $16 billion, though this has never been approached.”

    Broeksmit goes on to say that most of Deutsche’s money from the scheme “is actually made by lending them specials that we have on inventory and they pay far above the regular rates for that.”

    It would appear that with just months until the regulatory crackdown and Congressional kangaroo circus, Broeksmit knew what was about to pass and being deeply implicated in such a scheme, preferred to take the painless way out.

    The question then is just what major regulatory revelation is just over the horizon for Deutsche Bank if yet another banker had to take his life to avoid being cross-examined by Congress under oath? For a hint we go back to another report, this time by the FT, which yesterday noted that Deutsche Bank will set aside just under €1bn towards the numerous legal and regulatory issues it faces in its third quarter results next week, the bank confirmed on Friday.

    In a statement made after the close of markets, the Frankfurt-based lender said it expected to publish litigation costs of €894m when it announces its results for the July-September period on October 29.

    The extra cash will add to Deutsche’s already sizeable litigation pot, where the bank has yet to be fined in connection with the London interbank rate-rigging scandal.

    It is also facing fines from US authorities over alleged mortgage-backed securities misselling and sanctions violations, which have already seen rivals hit with heavy fines.

    Deutsche has also warned that damage from global investigations into whether traders attempted to manipulate the foreign-exchange market could have a material impact on the bank.

    The extra charge announced on Friday will bring Deutsche’s total litigation reserves to €3.1bn. The bank also has an extra €3.2bn in so-called contingent liabilities for fines that are harder to estimate.

    Clearly Deutsche Bank is slowly becoming Europe’s own JPMorgan – a criminal bank whose past is finally catching up to it, and where legal fine after legal fine are only now starting to slam the banking behemoth. We will find out just what the nature of the latest litigation charge is next week when Deutsche Bank reports, but one thing is clear: in addition to mortgage, Libor and FX settlements, one should also add gold. Recall from around the time when the first DB banker hung himself: it was then that Elke Koenig, the president of Germany’s top financial regulator, Bafin, said that in addition to currency rates, manipulation of precious metals “is worse than the Libor-rigging scandal.”

    It remains to be seen if Calogero’s death was also related to precious metals rigging although it certainly would not be surprising. What is surprising, is that slowly things are starting to fall apart at the one bank which as we won’t tire of highlighting, has a bigger pyramid of notional derivatives on its balance sheet than even JPMorgan, amounting to 20 times more than the GDP of Germany itself, and where if any internal investigation ever goes to the very top, then Europe itself, and thus the world, would be in jeopardy.

    At this point it is probably worth reminding to what great lengths regulators would go just to make sure that Deutsche Bank would never be dragged into a major litigation scandal: recall that the chief enforcer of the SEC during the most critical period following the great crash of 2008, Robert Khuzami, worked previously from 2002 to 2009 at, drumroll, Deutsche Bank most recently as its General Counsel (see “Robert Khuzami Stands To Lose Up To $250,000 If He Pursues Action Against Deutsche Bank” and “Circle Jerk 101: The SEC’s Robert Khuzami Oversaw Deutsche Bank’s CDO, Has Recused Himself Of DB-Related Matters”). The same Khuzami who just landed a $5 million per year contract (with a 2 year guarantee) with yet another “law firm”, Kirkland and Ellis. One wonders: if and when the hammer falls on Deutsche Bank, will it perchance be defended by the same K&E and its latest prominent hire, Robert Khuzami himself?

    But usually it is best to just avoid litigation altogether. Which is why perhaps sometimes it is easiest if the weakest links, those whose knowledge can implicate the people all the way at the top, quietly commit suicide in the middle of the night…

    Posted by Swamp | October 25, 2014, 11:25 am
  7. @SWAMP and Participo–

    Sharp eyes–good show!

    Although both of you researched the same article, I’ve included both of your contributions.

    SWAMP included the entire text of the Zerohedge post.

    Participo highlighted several key passages.

    I am skeptical that Mr. Gambino wasn’t connected to the major crime family.

    The mob has been moving into Wall Street and the financial industry for some time.

    Keep up the good work,

    Dave

    Posted by Dave Emory | October 25, 2014, 1:11 pm

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