First, the outrageous 1970s entrance exam for women came to light, now Merrill Lynch’s wealth management business has agreed to settle an eight-year racial discrimination law suit by paying out $180m, which will be made available to all black brokers and trainees who have worked at the firm since 2001.
When the suit was first filed in 2005, just one in 75 financial advisers at the firm were black, and they were considered among the poorest producers. However, Stanley O’Neal (Merrill’s first black chief executive) admitted that black brokers find it tougher to drum up business or maintain relationships with clients because most of the bank’s clients were white and might not trust brokers who were not. Around 1,200 current and former employees could share in the pay out.
Separately, in a sign that bonuses are back on Wall Street – or perhaps that hedge fund managers are being more flash with the cash - Joe Farrell, the president of Farrell Building, which builds luxury homes in the Hamptons, claims to be “busier than ever”.
Most of his clientele are Wall Street financiers, he claims, who are happily snapping up luxury houses with “two bowling lanes, a skate ramp, onyx window frames and, just for fun, an A.T.M. regularly restocked with $20,000 in $10 bills”. It’s not all good though – whereas Farrell would have built houses worth around $20m, he’s now targeting the market willing to spend a mere $3-10m.
“Mostly, though, $3 million to $6,” he said. “I love that market — there are probably 10 times as many people in that market than to buy an eight- or nine-million-dollar house, right?”
Raj Rajaratnam is living it up in jail with a personal manservant, private bathroom and good food (NY Post)
Actually, that’s nonsense – he’s just very ill (CNBC)
J.P. Morgan may have to pay $6bn for mis-selling mortgage securities (Financial Times)
….and up to $600m to various regulators as part of London Whale settlement (Wall Street Journal)
…and $80m to for its dealings with consumers during the recession (Dealbook)
Javier Martin-Artajo arrested in Madrid, then opposes extradition to the U.S. (Bloomberg)
Martin-Artajo has been on a luxury safari holiday in Zimbabwe (Daily Mail)
M&A has become much more complex, with up regulators in up to 100 countries potentially involved (Financial Times)
Shake-up at the top in Barclays’ Australian investment bank (Money Beat)
Zurich CFO, Pierre Wauthier, committed suicide (Bloomberg)