Jim Sinclair’s Commentary
This weekend I assured you that “Pay to Play” was key to the majority of pension fund money now decimated by the players.
The failure of pension funds and the misdeeds to get the money under management is going to drive pensioners and all those that planned some day to retire right out of their minds.
In State Pension Inquiry, a Scandal Snowballs
By DANNY HAKIM and MARY WILLIAMS WALSH
Published: April 17, 2009
The inquiry into corruption at the New York State pension fund started simply enough. Alan G. Hevesi, the former comptroller, was accused of using state workers as chauffeurs for his ailing wife.
But by the time Mr. Hevesi resigned his office in late 2006, investigators for the Albany County district attorney’s office were examining a more troubling problem: allegations that Mr. Hevesi’s associates had sold access to the state’s $122 billion pension fund, using one of the world’s largest pools of assets to reward friends, pay back political favors and reap millions of dollars in cash rewards for themselves.
“We knew this was not going to be a case we could handle ourselves in Albany County,” recalled P. David Soares, the Albany County district attorney.
In 2007, Attorney General Andrew M. Cuomo’s office and then the Securities and Exchange Commission took over the inquiry, which has ballooned into a sprawling investigation involving some of the most prominent players in New York’s political and financial worlds.
Hundreds of investment firms have been subpoenaed. Three people have been criminally charged and another has pleaded guilty to a felony. And the scandal has grabbed the attention of Wall Street, as members of the investment establishment’s top tier now face scrutiny.
Jim Sinclair’s Commentary
Maybe you can fool some of the people some of the time and that time has worn itself out. To call mark to market a gimmick was a top in foolishness.
Criticism of U.S. accounting changes mounts
IASB said the rationale for watering down fair value is “crazy”
Published: Monday, April 20, 2009
Wall Street lobbyists and U.S. politicians are damaging the credibility of corporate reporting and hurting the interests of investors around the world by pulling-back on fair value accounting, a top international accountant said.
The comments from Tom Jones, vice-chair of the International Accounting Standards Board, come after U.S. standard-setters unilaterally decided to dilute the controversial accounting rule earlier this month.
In an interview with the Financial Post, Mr. Jones warned of “a loss of credibility” and said the rationale for watering down fair value is “crazy.” He also cited concerns about political interference that could undermine the independence of accounting rule setters, a fear that was echoed by other senior accountants Monday.
In early April, the U.S. Financial Accounting Standards Board pledged to backtrack on fair value accounting under intense pressure from Wall Street and demands from Congress. U.S. lawmakers had even threatened to take the matter into their own hands rather than leave it to the accountants. The resulting FASB rule changes released on Friday allow banks to use judgment rather than market prices, to value financial instruments.