Five giant international banks agreed to U.S. guilty pleas for market manipulation in either interest rates or currency exchange rates. All were quickly granted waivers from the SEC to allow them to continue to operate in the securities business. Rules ordinarily ban criminals from issuing securities. The too-big-to-fail banks are exempt from this rule, but the exemption requires a formal SEC action for each criminal conviction. The banks will be looking for a similar exemption that covers the retirement funds they manage. In addition to the guilty pleas, the banks agreed to pay an average of $1 billion each in fines.
BNY Mellon will pay $180 million to settle charges of currency exchange transaction fraud. For years the bank retroactively assigned the least favorable currency exchange transactions of each trading day to managed funds, mostly retirement funds, in violation of its contracts with the funds.
Corporate credit unions ended up holding piles of bad assets after the real estate bust of 2008. It was the derivatives that did the most damage, but there was also actual real estate that served as collateral for failed loans. It was left to the NCUA to sell off that real estate, and it completed that process in the first quarter of 2015. That is a sign that the NCUA is done with the heavy lifting in the difficult process of rehabilitating the corporate credit unions.
