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November 18, 2019

Inner City Press / Fair Finance Watch received from the Federal Reserve last week a cover letter - without the attachment that went to Banco Bradesco: "Dear Mr. Lee     Please see the attached AI request in connection with the filing by Banco Bradesco, S.A., Lecce Holdings S.A., Fundacao Bradesco, BBD Partipacoes S.A., Nova Cidade de Deus Participacoes S.A., and Cidade de Deus Cia. Comercial de Participcoes (collectively, the “Applicants”), all of Osasco, Sao Paulo, Brazil for prior approval of the Board of Governors of the Federal Reserve System (the “Board”) pursuant to Section 3(a)(1) of the Bank Holding Company Act of 1956, as amended, and Section 225.15 of Regulation Y, to become bank holdings companies by acquiring substantially all of the shares of BAC Florida Bank, Coral Gables, Florida.     Once we receive the response, we will forward to you also." And attached, on this: " Please see the attached additional information request letter in connection with the filing by Banco Bradesco, S.A., Lecce Holdings S.A. , Fundacao Bradesco, BBD Participacoes S.A., Nova Cidade de Deus Participacoes S.A., and Cidade de Deus Cia. Comercial de Participcoes, all of Osasco, Sao Paulo, Brazil, to become bank holding companies by acquiring substantially all of the shares of BAC Florida Bank, Coral Gables, Florida." That that, nothing attached...

For now: "
Banco Bradesco Class Action Settlement Hits 2 Day Hitch on Blacksmiths and Rule 11 in SDNY

By Matthew Russell Lee, Patreon
Honduras - The Source - The Root - etc

SDNY COURTHOUSE, Nov 12 –  In 2016 Banco Bradesco was sued for fraud on the market for withholding information about being investigated as part of the Operation Zelotes probe of tax fraud in Brazil.

The case, a putative class action, was filed in the U.S. District Court for the Southern District of New York and was assigned to Judge Gregory H. Woods.   

On November 13 in Judge Woods' nearly empty courtroom what was styled as a fairness hearing on a near-final settlement was held. Only two issues held up Judge Woods signing off on the over $14 million settlement, with 25% going for attorneys fees. In the gallery was only Inner City Press.

    An October 8 notice of motion says that "Court-appointed Lead Counsel Kessler Topaz Meltzer & Check LLP will on and hereby do move this Court, on November 13, 2019 at 4:15 pm, for entry of an Order awarding attorney's fees and expenses."

    But at the time, with the gallery nearly empty, the order was not signed. The firm wanted Judge Woods to find that they had not violated Rule 11.

    Judge Woods, however, said he did not have the factual predicate to be comfortable making that finding, and ask for further filings by November 15, including on a proposed $7,605.61 payment to Boilermaker-Blacksmith National Pension Trust. The case is In Re Banco Bradesco S.A. Securities Litigation, 16-cv-3144 (Woods).

November 11, 2019

  "Thousands of companies around the world are now reporting climate-related financial exposures to the Carbon Disclosure Project (CDP) under the guidelines of the Financial Stability Board (FSB) Task Force on Climate-Related Financial Disclosures." That's Lael Brainart; in other news, no follow through on ensuring that FOIA requests related to mergers are ruled on before the Fed closes comment periods. Also, problems with HMDA availability from CFPB: isn't this as much in the Fed's wheelhouse and area of responsibility?

November 4, 2019

  While the CFPB continues to withhold basic mortgage lending data, we note that a spokesperson for disparate LendingClub is quoted: “We are completely committed to fair lending practices. Researchers at the Philadelphia Fed have analyzed our data and concluded that we’re lending in more areas where banks are closing their branches, we’re improving pricing and the quality of credit decisioning, and increasing financial inclusion.”  Wait - so now the Federal Reserve has handing out fair lending cover up fig leafs to disparate fintechs? What will the Federal Reserve Board do about this?

By Matthew Russell Lee

SOUTH BRONX, SDNY COURT, Oct 5 – Talk about bias: a member of the U.S. Federal Reserve Board, Michelle Bowman, who is supposed to objectively review challenged bank mergers had been quoted that mergers are good: mergers “in a general sense, are a natural and often desirable consequence of competition in a vibrant market economy,” Bowman said.

  This is unacceptable.  Meanwhile the Fed is still withholding documents about the Bangladeshi Central Bank hack and its role in it requested months ago by Inner City Press under the Freedom of Information Act, has put out for comment a proposal to further weaken its duties under FOIA. The proposal does not even address an obvious disrespect by the Fed to public commenters which Inner City Press raised to a Fed Governor earlier this year. Now as a first comment, this has been submitted:

June 15, 2019 

Via e-mail to regs.comments [at] federalreserve [dot] gov 

Board of Governors of the Federal Reserve System Attn: Governors, Ann E. Misback, Secretary 20th Street and Constitution Avenue NW Washington, DC 20551 
Re: First Comment on Docket No. R–1665 and RIN No. 7100 AF 51 

Dear Governors and Ann E. Misback, Secretary:     

On behalf of Inner City Press, a frequent requester to the Federal Reserve Board (FRB) and other agencies under the Freedom of Information Act (FOIA), and in my personal capacity, this is a first comment on the proposed revisions to the FRB's proposed rulemaking (proposal) that would amend the Board’s Rules Regarding Availability of Information (Board’s Rules).    

As a practitioner what is most disappointing about this rulemaking is that the FRB has not even proposed to address a major problem raised to it, including to Governor Lael Brainard earlier this year: that the FRB routinely delays responding to FOIA requests and even frivolous requests for confidential treatment by applicants for regulator approval under AFTER the Board has approved contested merger applications.     As Inner City Press asked Governor Brainard, how does this FRB failure not incentivize applicant banks to make overbroad requests for confidential treatment of their applications, responses to public comment and response to FRB Additional Information requests, knowing that there is no repercussion nor commitment by the FRB to address the overbroad withholding request until after their applications are approved?    Given the FRB's legal duty to consider public comments on mergers, including comments informed by what the applicant banks actually submit, the FRB must address this problem in this rulemaking.  

 Overall, the FRB not only denied expedited processing of Inner City Press' request for FRB records concerning its actions and role in the Bangladesh Bank hack and case - it has refused to respond to an appeal of its constructive denial of access to any records, after months, see below incorporated herein by reference. This too must be addressed.     For now, we also note the potential abuse, shown most recently by the FRB's sister agency the OCC, that allowing the agency to do nothing to begin collecting records as long as it disputes a fee waiver request. The OCC is still disputing a fee waiver request for the submissions of WSFS for approval to acquire Beneficial in Philadelphia, long after the OCC (like the FRB) approved the Application.     We may have further comment but wished the raise the above at the earliest possible time in the process to ensure that the FRB belatedly address the issue(s).    

By Matthew R. Lee, Exclusive

SOUTH BRONX, SDNY, Sept 7 – Amid attacks on the U.S. Community Reinvestment Act this month Inner City Press / Fair Finance Watch in early August filed comments under the CRA opposing Banco Bradesco's application to acquire BAC Florida.  Now the Federal Reserve has asked Bradesco some questions, below. Here's some of the protest: "This is a timely first comment opposing and requesting documents about and an extension of the FRB's public comment period on the Application by Banco Bradesco to acquire BAC Florida.       This is a proposal by a bank in Brazil where authorities are reviewing the bank for corruption, to buy a US bank with a disparate lending record in order to use it to serve disproportionately the affluent. There is no public benefit; the application should be denied.       Fair Finance Watch has been reviewing the Home Mortgage Disclosure Act (HMDA) data for 2017 for BAC Florida and finds, troublingly, that for home purchase loans in the New York City MSA it made 13 such loans to Asians, and none to African Americans or Latinos. For Latinos it hada 100% denial rate.       In the Miama MSA in 2017, BAC Florida made 68 home puchase loans to whites and none to African Americans.  Now see, for the record, "Brazil's Bradesco to buy Florida bank to focus on wealthy individuals" - "Banco Bradesco SA has embarked on its first-ever international acquisition by paying approximately $500 million to buy BAC Florida Bank, which focuses on high-net-worth individuals in a move intended to close the gap with Brazilian rivals.  Based in Coral Gables, BAC Florida is controlled by Grupo Pellas, which was founded in 1877 in Nicaragua.  After the deal closes, Bradesco said its main goal is to provide a wide range of financial services in the United States to Bradesco clients and lure new customers to BAC Florida.  Bradesco Chief Executive Officer Octavio de Lazari said on a call with journalists that the Brazilian bank’s private banking clients have increasingly demanded diversification and greater access to global products.   “This move underscores our expansion not only in the U.S., but also in Latin America as a whole, as BAC has clients all over the region,” he said. Around 20 percent of BAC Florida’s clients are Brazilian and 9 percent are American.  Still, Lazari said Bradesco is not seeking to build a retail base outside Brazil, but wants to boost its private banking business." Where is the CRA?      

Now see this, on managerial resources, also for the record and the request for an evidentiary hearing: "Brazilian anti-graft prosecutors mull lawsuit against Bradesco"  - " Brazilian prosecutors are considering a civil lawsuit against Banco Bradesco SA , as they believe the country’s second-largest private-sector bank may have failed to prevent corruption schemes, Valor Econômico reported on Thursday.  Earlier this week, prosecutors asked a court to issue an arrest warrant for two Bradesco bank managers, saying they had been part of a complex scheme involving shell companies, fraudulent checks and bank slips that helped launder nearly 1 billion reais ($252 million).  Eduardo El Hage, the prosecutor heading the Rio de Janeiro part of the massive “Car Wash” corruption investigation, told the Brazilian newspaper he believes Bradesco should have caught on to those financial transactions.  Bradesco declined to comment on the matter."       On the current record, Banco Bradesco's applications should be denied."

  On September 6, the Federal Reserve asked Bradesco questions including "Based on our review of the current record, the following additional information is requested. Please provide responses to all of the following items, including those in the Confidential Annex. Supporting documentation should be provided, as appropriate. Proposal 1. The filing states that Lecce will be a Brazilian holding company over BAC. Discuss the role and purpose of Lecce and how it will be integrated into the governance, operating, and reporting structure of Bradesco. 2. Provide a summary of the findings of the due diligence review by Shearman & Sterling LLP, KPMG, and CRMa, LLC., and discuss whether any findings had a bearing on Bradesco's strategy for BAC or would result in changes to BAC's risk management framework and internal controls. 3. Discuss whether the U.S. securities broker-dealers of BAC and Bradesco will maintain separate operations and customer bases, or whether their operations and customers are expected to be integrated. 4. Provide an updated list of the proposed directors and senior executive officers of BAC indicating which of the current BAC directors and senior executive officers are expected to remain with BAC. For any of the proposed directors and senior executive officers who currently have positions with Bradesco, provide their roles in the chart.

By Matthew Russell Lee, Patreon

FEDERAL COURTHOUSE, August 19 – The Bangladeshi Central Bank which was hacked for $81 million in February 2016, on January 31 sued in the US District Court for the Southern District of New York. The first pre-trial conference in the case was held on May 21; on July 19 Bangladesh Bank opposed the defendant's motions to dismiss for forum non conveniens and lack of subject matter jurisdiction.

 On related obstruction news, in a letter dated August 20 the US Federal Reserve Board upheld its own denial of documents about Bangladesh Bank with Inner City Press requested under the Freedom of Information Act. More here including the Fed's letter on Patreon, here. We'll have more on this.

  Rizal Commercial Banking Corporation's Ismael Reyes has started a separate ex parte action in the SDNY, seeking discovery against Bank of New York Mellon. That case has been assigned a separate number: 19-cv-7219.

  Bangladesh Bank responded on August 19, telling SDNY Judge Lorna G. Schofield that "Defendants did not clarify that the 1782 procedure does not work against crucial governmental discovery sources, like the FBI and possibly the New York Fed, pointing instead to the vastly more limited FOIA process."  So it is apparently unclear if Section 1782 applies to the Fed; that the Federal Reserve limits - and delays - FOIA, Inner City Press can attest to. We'll have more on this.

  Earlier, Bangladesh Bank wrote that "[t]he robbery was in New York City, not a foreign country, attacking a decades-old account in the New York. It involved the New York Fed, perhaps the most critically important bank in New York City. The conspirators also needed New York-based correspondence accounts to accomplish the theft." In its other brief it adds, "Since 1973, the Bank has held its foreign reserves at the New York Fed in order to conduct Bangladesh’s international transactions in U.S. dollars. Id. ¶¶ 37-40. Today, the Bank conducts 85% of its international transactions in the U.S. dollar, through its New York Fed account, that holds a daily average of $1.5 billion."

  Back in March Inner City Press submitted a request under the US Freedom of Information Act to the US Federal Reserve about its role in and action on the Bangladesh Bank heist. After four months of delay from the Fed, and an appeal by Inner City Press of their constructive denial, the Fed finally ruled on June 27 - releasing only one page, a two paragraph cover letter.

By Matthew R. Lee, Exclusive

SOUTH BRONX, SDNY, August 10 – Amid attacks on the U.S. Community Reinvestment Act this month Inner City Press / Fair Finance Watch has filed comments under the CRA opposing Banco Bradesco's application to acquire BAC Florida.  Here's some of it: "This is a timely first comment opposing and requesting documents about and an extension of the FRB's public comment period on the Application by Banco Bradesco to acquire BAC Florida.       This is a proposal by a bank in Brazil where authorities are reviewing the bank for corruption, to buy a US bank with a disparate lending record in order to use it to serve disproportionately the affluent. There is no public benefit; the application should be denied.       Fair Finance Watch has been reviewing the Home Mortgage Disclosure Act (HMDA) data for 2017 for BAC Florida and finds, troublingly, that for home purchase loans in the New York City MSA it made 13 such loans to Asians, and none to African Americans or Latinos. For Latinos it hada 100% denial rate.       In the Miama MSA in 2017, BAC Florida made 68 home puchase loans to whites and none to African Americans.  Now see, for the record, "Brazil's Bradesco to buy Florida bank to focus on wealthy individuals" - "Banco Bradesco SA has embarked on its first-ever international acquisition by paying approximately $500 million to buy BAC Florida Bank, which focuses on high-net-worth individuals in a move intended to close the gap with Brazilian rivals.  Based in Coral Gables, BAC Florida is controlled by Grupo Pellas, which was founded in 1877 in Nicaragua.  After the deal closes, Bradesco said its main goal is to provide a wide range of financial services in the United States to Bradesco clients and lure new customers to BAC Florida.  Bradesco Chief Executive Officer Octavio de Lazari said on a call with journalists that the Brazilian bank’s private banking clients have increasingly demanded diversification and greater access to global products.   “This move underscores our expansion not only in the U.S., but also in Latin America as a whole, as BAC has clients all over the region,” he said. Around 20 percent of BAC Florida’s clients are Brazilian and 9 percent are American.  Still, Lazari said Bradesco is not seeking to build a retail base outside Brazil, but wants to boost its private banking business." Where is the CRA?      

By Matthew Russell Lee, Patreon

SDNY COURTHOUSE, August 4 – Three years after Capital One Bank was sued for its overdraft fees on debit card transactions for which there were sufficient funds available in the customers' accounts, on June 25 the bank's motion for summary judgment was denied by U.S. District Court for the Southern District of New York Judge Lorna G. Schofield.   

  On July 29 Capital One belatedly disclosed that it was "compromised," including 140,000 social security numbers, 80,000 linked bank account numbers, and “personal information” from credit card applications from 2005 through early 2019. This hacking began on March 12, but Capital One didn’t do anything about it until 127 days later.  And where were and are the regulators, who approved Capital One's mergers rebuffing detailed Press comments?

By Matthew R. Lee, FOIA docs, BB&T denial

NEW YORK CITY, August 2 – When BB&T announced a $66 billion proposal to take over Suntrust Bank, to form a subsequently named Truist, many linked it to deregulatory moves in Washington. Then two days after Federal Reserve Governor Lael Brainard was asked by Inner City Press about the Fed's lax review of previous mergers, including WSFS on which the Fed still hasn't ruled on the bank's withholding of information after rubber stamping the deal, the Fed announced public hearings. But the fix it seems it still in. On April 18, conveniently, the Fed "announce[d] termination of enforcement action with BB&T Corporation" for money laundering. So there's a public comment period on the merger, but none on the Fed's dubious move while the application is pending. Meanwhile as Inner City Press has exclusively reported, BB&T has been named in connection with sleazy debt collections in a case in the SDNY - more on all this to come. On April 29, Inner City Press submitted a FOIA request about the dubious termination of enforcement action, and a comment to the Fed and FDIC, below.

 On August 2 the FDIC belatedly gave Inner City Press only the June 2019 Order ending without explanation the money laundering enforcement action against BB&T. The FDIC redacted John P. Henrie's signature as private information. What else are they withholding? Watch this site.

By Matthew R. Lee, FOIA docs, BB&T denial

NEW YORK CITY, July 20 – When BB&T announced a $66 billion proposal to take over Suntrust Bank, to form a subsequently named Truist, many linked it to deregulatory moves in Washington. Then two days after Federal Reserve Governor Lael Brainard was asked by Inner City Press about the Fed's lax review of previous mergers, including WSFS on which the Fed still hasn't ruled on the bank's withholding of information after rubber stamping the deal, the Fed announced public hearings. But the fix it seems it still in. On April 18, conveniently, the Fed "announce[d] termination of enforcement action with BB&T Corporation" for money laundering. So there's a public comment period on the merger, but none on the Fed's dubious move while the application is pending. Meanwhile as Inner City Press has exclusively reported, BB&T has been named in connection with sleazy debt collections in a case in the SDNY - more on all this to come. On April 29, Inner City Press submitted a FOIA request about the dubious termination of enforcement action, and a comment to the Fed and FDIC, below.

  On the afternoon of May 2, before seeking to close the comment period on BB&T - Suntrust on May 3, the Federal Reserve wrote to Inner City Press that only ONE PAGE about its BB&T money laundering enforcement termination would be provided, and 133 pages withheld in full, no even subject to the type of partial redaction that is required under FOIA. FRB 99% denial letter here.

By Matthew R. Lee, Video, 7/31 story

SOUTH BRONX, July 5 – Cadence Bancorporation which has a disparate lending record while apply to buy State Bank in Georgia and urging faster regulatory approvals, seemingly jumped the gun before having the required Federal Reserve Board approval. That was six months ago, when a letter that Cadence and its outside counsel, former Federal Reserve lawyer Patricia Robinson, were required to provide a copy to Inner City Press / Fair Finance Watch they on purpose only sent by mail (rather than e-mail), then delayed weeks in resending. Photo here.

By Matthew Russell Lee, Patreon

FEDERAL COURTHOUSE, June 29 – The Bangladeshi Central Bank which was hacked for $81 million in February 2016, on January 31 sued in the US District Court for the Southern District of New York. The first pre-trial conference in the case was held on May 21, see below.

  Back in March Inner City Press submitted a request under the US Freedom of Information Act to the US Federal Reserve about its role in and action on the Bangladesh Bank heist. After four months of delay from the Fed, and an appeal by Inner City Press of their constructive denial, the Fed finally ruled on June 27 - releasing only one page, a two paragraph cover letter.

  This is the opposite of transparency. Inner City Press on June 29 submitted an appeal: "Dear Governor in charge of FOIA Appeals:  On behalf of Inner City Press / Fair Finance Watch (ICP), this is a near immediate FOIA appeal of FRB absurd denial by providing only one page, a two paragraph cover letter, in response to Inner City Press' FOIA request four months ago regarding the Federal Reserve's role in and action on the Bangladesh Bank heist      As you must know, agencies are request to provided all reasonably segregable information and are not allow mass withhold, as here. Beyond the Bangladesh Bank, to withhold in full records about the oversight by the Board over the Reserve Bank is an outrage. See also Inner City Press' timely comments on the FRB's current proposals to modify - and weaken - its FOIA responsibilities.   

By Matthew Russell Lee

SOUTH BRONX, SDNY COURT, June 15 – The U.S. Federal Reserve Board, while still withholding documents about the Bangladeshi Central Bank hack and its role in it requested months ago by Inner City Press under the Freedom of Information Act, has put out for comment a proposal to further weaken its duties under FOIA. The proposal does not even address an obvious disrespect by the Fed to public commenters which Inner City Press raised to a Fed Governor earlier this year. Now as a first comment, this has been submitted:

June 15, 2019 

Via e-mail to regs.comments [at] federalreserve [dot] gov 

Board of Governors of the Federal Reserve System Attn: Governors, Ann E. Misback, Secretary 20th Street and Constitution Avenue NW Washington, DC 20551 
Re: First Comment on Docket No. R–1665 and RIN No. 7100 AF 51 

Dear Governors and Ann E. Misback, Secretary:     

On behalf of Inner City Press, a frequent requester to the Federal Reserve Board (FRB) and other agencies under the Freedom of Information Act (FOIA), and in my personal capacity, this is a first comment on the proposed revisions to the FRB's proposed rulemaking (proposal) that would amend the Board’s Rules Regarding Availability of Information (Board’s Rules).    

As a practitioner what is most disappointing about this rulemaking is that the FRB has not even proposed to address a major problem raised to it, including to Governor Lael Brainard earlier this year: that the FRB routinely delays responding to FOIA requests and even frivolous requests for confidential treatment by applicants for regulator approval under AFTER the Board has approved contested merger applications.     As Inner City Press asked Governor Brainard, how does this FRB failure not incentivize applicant banks to make overbroad requests for confidential treatment of their applications, responses to public comment and response to FRB Additional Information requests, knowing that there is no repercussion nor commitment by the FRB to address the overbroad withholding request until after their applications are approved?    Given the FRB's legal duty to consider public comments on mergers, including comments informed by what the applicant banks actually submit, the FRB must address this problem in this rulemaking.  

 Overall, the FRB not only denied expedited processing of Inner City Press' request for FRB records concerning its actions and role in the Bangladesh Bank hack and case - it has refused to respond to an appeal of its constructive denial of access to any records, after months, see below incorporated herein by reference. This too must be addressed.     For now, we also note the potential abuse, shown most recently by the FRB's sister agency the OCC, that allowing the agency to do nothing to begin collecting records as long as it disputes a fee waiver request. The OCC is still disputing a fee waiver request for the submissions of WSFS for approval to acquire Beneficial in Philadelphia, long after the OCC (like the FRB) approved the Application.     We may have further comment but wished the raise the above at the earliest possible time in the process to ensure that the FRB belatedly address the issue(s).    

Thank you for your attention.  Matthew Lee, Executive Director Inner City Press / Fair Finance Watch

Incorporated by reference along with underlying request(s) in the FRB's possession: 

From: Matthew R. Lee, Inner City Press Date: Tue, May 21, 2019 at 2:05 PM Subject: FOIA appeal of FRB's constructive denial of Feb 17 FOIA request about Bangladesh Bank, nothing since April 2, SDNY today

May 21, 2019 

FRB Governor covering FOIA appeals: Information Disclosure Section, Board of Governors of the Federal Reserve 20th & Constitution Avenue, NW, Washington, DC 20551  FOIA APPEAL of constructive denial of FOIA Request No. F-2019-00095  Dear FRB Governor covering FOIA appeals:   This is an appeal of what is now the constructive denial of Inner City Press' and my Feb 17, 2019 FOIA request for "records regarding the Federal Reserve System's [role] including the FRBNY's role in what is known as the Bangladesh Bank hack or cyber heist and assistance provided to Bangladesh Bank and investigative authorities since the heist, including but limited to in connection with the SDNY case Bangladesh Bank v Rizal Commercial Banking Corp et al, U.S. District Court, Southern District of New York, No. 19-00983."    First, the FRB denied the request for expedited processing, finding no threat of physical harm (??) and also reciting and presumably denying under this standard:     "[t]he requester is a representative of the news media ... and there is urgency to inform the public concerning actual or alleged Board activity.”    Still, the Fed in further extending its time said there would be response by April 2. There has been none, nothing at all.   Today in the SDNY counsel for Bangladesh Bank directly referred to the Federal Reserve. The Fed's delay, contrasted to the fast if bad faith turn around on Inner City Press' BB&T money laundering enforcement action termination FOIA, is in this context unacceptable, even a cover up.    This is an appeal. The FRB should provide an explanation of nothing since April 2, and the long ago requested documents.  Please confirm receipt, thank you in advance, 

Matthew Lee, Inner City Press/Fair Finance Watch"

By Matthew R. Lee, Patreon

NEW YORK CITY, May 30 – Barclays applied to the U.S. Federal Reserve in early 2018 for regulatory approval for a Cayman Islands holding company to become the parent of its U.S. bank. Inner City Press / Fair Finance Watch, as dubious then as now about such moves, requested documents and a delay or denial of the proposal.

 Now on May 29, 2019, fifteen months later, the Federal Reserve has informed Inner City Press that Barclays has "withdrawn" its Cayman Islands application.  Federal Reserve's May 29 Barclays letter and more on Patreon, here.

By Matthew Russell Lee, Patreon

FEDERAL COURTHOUSE, May 21 – The Bangladeshi Central Bank which was hacked for $81 million in February 2016, on January 31 sued in the US District Court for the Southern District of New York. The first pre-trial conference in the case was held on May 21, and at it SDNY Judge Lorna G. Schofield expressed serious concern if she has subject matter jurisdiction.

  Judge Schofield encouraged the defendants to jointly file two briefs supporting a motion to dismiss by June 14. The first is to be on subject matter jurisdiction, the second on "forum non conveniens." 

  Rizal Commercial Banking Corp (RCBC), through its counsel Tai-Heng Cheng of Sidley Austin on May 21 marveled that Bangladesh Bank has still not succeeded with service of process of the complaint - actually handing the document to those charged, in essence - for example failing to use a sheriff under provisions of Philippines law.

  There also remain questions about service on the other named defendants, one of whom (Mr. Go) is now deceased. The others include: "MAIA SANTOS DEGUITO, ANGELA RUTH TORRES, LORENZO V. TAN, RAUL VICTOR B. TAN, ISMAEL S. REYES, BRIGITTE R. CAPIÑA, NESTOR O. PINEDA, ROMUALDO S. AGARRADO, PHILREM SERVICE CORP., SALUD BAUTISTA, MICHAEL BAUTISTA, CENTURYTEX TRADING, WILLIAM SO GO, BLOOMBERRY RESORTS AND HOTELS, INC. D/B/A SOLAIRE RESORT & CASINO [represented on May 21 by Daniel M. Perry of Milbank], EASTERN HAWAII LEISURE COMPANY, LTD. D/B/A MIDAS HOTEL & CASINO, KAM SIN WONG A/K/A KIM WONG, WEIKANG XU, DING ZHIZE, GAO SHUHUA, and JOHN DOES 1-25." 

  Judge Schofield encouraged Bangladesh Bank to try to perfect service, but remained focused on whether she and the SDNY court havesubject matter jurisdiction. She asked, as to the RICO claim in the complaint, when the alleged conspiracy began and ended. Bangladesh Bank's response referred to US government complaints, including in the U.S. District Court for the District of Central California, against North Korea for the SONY hack in 2014.

   Afterward Inner City Press asked Bangladesh Bank's lead lawyer, John J. Sullivan of Cozen O'Connor, if he had been surprised by Judge Schofield's approach. He said he had expected it, and argued that the judge is considering whether the case is best placed in Federal court or New York State Supreme Court on the other side of Pearl Street. 

  Inner City Press asked him, Doesn't forum non conveniens in this case point to the Philippines? And why hasn't Bangladesh Bank also sued North Korea? Sullivan said he was not at liberty to answer. We'll have more on this - for now, more on Patreon, here.    Inner City Press has appealed the Fed's constructive denial of its FOIA request on this - without response...

By Matthew R. Lee, Video, story, FOIA docs

SOUTH BRONX,  May 2 – Federal Reserve Board chairman Jay Powell told Congress he will run transparent reviews of mergers like BB&T - Suntrust, and announced two public hearings as if to prove it. But on February 27 while still not acting on Inner City Press' Freedom of Information Act request for withheld information, his Fed Board rubber stamped the application by WSFS to buy Beneficial and close at least 25 branches. Until May 2 the Fed has directly portended to become even more of a rubber stamp, with the now withdrawn nomination to the Board of Stephen Moore, even after his characterization as "armpits" of  Cleveland - host to the Federal Reserve Bank of Cleveland - and Cincinnati. Moore said it was due to stress on is family but earlier on May 2 was bragging to finance reporters that he would go forward. No more. (No Moore).

  But the Federal Reserve remains problematic. It has only today an hour after Moore's nomination ended produced only a single page of the "all records" Inner City Press has requested under the Freedom of Information Act about the Fed's dubious decision to terminate its money laundering enforcement order against BB&T just before the comment period on its proposed merger with Suntrust is set to expire on May 3. We'll have more on this.

  Nomination post-mortem: apparently in an attempt to keep his candidacy alive, Moore appeared without taking audience questions on the Brian Lehrer radio show on WNYC in New York on Sunday APril 28 appeared on ABC This Week. He was not asked about his substantive anti-CRA views, but was asked about his writing on gender and the closing the pay gap might be disruptive to the family. His evasive answer was about the current economy. Will it work? Senator Susan Collins was cited. We'll have more on this.

By Matthew R. Lee, FOIA docs

NEW YORK CITY, April 19 – When BB&T announced a $66 billion proposal to take over Suntrust Bank, which would close a still undisclosed number of branches and extend BB&T disparate lending patterns, many linked it to deregulatory moves in Washington. Then two days after Federal Reserve Governor Lael Brainard was asked by Inner City Press about the Fed's lax review of previous mergers, including WSFS on which the Fed still hasn't ruled on the bank's withholding of information after rubber stamping the deal, the Fed announced public hearings. But the fix it seems it still in. On April 18, conveniently, the Fed "announce[d] termination of enforcement action with BB&T Corporation" for money laundering. So there's a public comment period on the merger, but none on the Fed's dubious move while the application is pending. Meanwhile as Inner City Press has exclusively reported, BB&T has been named in connection with sleazy debt collections in a case in the SDNY - more on all this to come.