Wall Street faces an old threat with a new job

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SPITZER

Wall Street nemesis Eliot Spitzer’s new perch as New York City Comptroller gives the bank-bashing former AG who fell from grace as governor a new set of weapons – some more obvious than others.

Before he was fingered as "Client–9" for allegedly hiring a 22-year-old hooker, Spitzer slapped Wall Street’s biggest firms with a slew of lawsuits, shamed AIG’s Hank Greenberg on TV and pounced on NYSE CEO Dick Grasso's massive pay package.

Now, as the newly elected chief financial officer of New York City, Spitzer regains his authority to issue subpoenas, he gains unrivaled access to details of Wall Street salaries so he can cherry pick his targets and he takes control of the city's $140 billion in pension assets.

As Comptroller, Spitzer essentially becomes the portfolio manager of the behemoth city pension funds, which invest in many of the world’s biggest companies including financial giants.

And let’s not forget there’s already an army in place. With a high profile figure like Spitzer back in a powerful position, Wall Street will be hit from all angles.

Spitzer’s campaign will likely bolster the efforts of Larry Schloss, the city’s chief investment officer, who loathes that the city’s retirement system pays Wall Street money managers about $360 million a year. Schloss wants to take a lead from Canada and manage the mega money in-house.

Then there’s Benjamin M. Lawsky, New York’s superintendent of financial services, who is going after “shadow insurance” firms, claiming the nation’s biggest insurance companies are taking on too much risk at the expense of policyholders and taxpayers.

Watch out, Wall Street. Overcoming a sex scandal has only made Spitzer more stealth.

Citigroup Boosts its Board (Reuters)

Citigroup has appointed Gary Reiner, a former chief information officer at General Electric, and James Turley, former chairman and CEO of Ernst & Young, to its board in an effort to bolster corporate information systems and auditing. Chairman Mike O'Neill said two weeks ago that Citigroup might name as many as three new directors to its 11-member board.

Is it Pouring Pay for M&A Rainmakers? (eFinancialCareers)

Ian Hannam, the former J.P. Morgan senior mining banker, reportedly rakes in some £99k ($147k) in deferred bonuses alone for every single deal he seals. The bank’s mum on the exact sum.

Hedge Fund Sues Fannie and Freddie (Bloomberg)

Perry Capital has filed a federal court lawsuit accusing the U.S. government of illegally seizing the profits of mortgage finance behemoths Fannie Mae and Freddie Mac. The hedge fund wants the U.S. Treasury to stop enforcing a third amendment to preferred stock purchase agreements.

Don’t Let Heads Roll in Your Job Hunt (eFinancialCareers)

Don’t be a hater, recruiters can be more friend than foe in finding your next job. Here’s nine reasons why you should seek professional help in hunting and hiring.

Early Access to Market-Making Data Under Fire (CNBC)

Thomson Reuters suspended its practice of releasing core consumer sentiment data two seconds early to paying clients under pressure of New York state’s attorney-general probe. Other players in the $25bn market data industry include Markit’s Purchasing Managers’ Indices, which Thomson Reuters distributes, the Chicago Business Barometer from Deutsche Börse and the Institute for Supply Management.

Brookfield Names Public Markets CEO (Bloomberg)

Canada’s biggest alternative assets manager has named Craig Noble chief executive officer of the company’s New York-based public-market business. Noble, the co-chief investment officer and head of Brookfield Investment Management’s global infrastructure securities business, will replace Kim Redding, who will become chief investment strategist of Brookfield Asset Management.

Slim Showers Shazam (Forbes)

The world’s second-richest man has invested $40 million in music-recognition app Shazam. The British company that created the app that enables some 70 million monthly active users to flash a smartphone and identify what’s playing on the radio wants to expand its services to TV.

Buzz Around the Office

Twinkie Futures (AP)

Hostess Brands says the sugary spongy yellow cakes will have a shelf life of 45 days when they go back on sale July 15.

List of the Day: Success by Association

Here’s how to use mentors as a customized way of advancing your financial services career.

  1. Seek out someone at the executive level with a strong track record of success.
  2. Ask about salary negotiations, dealing with difficult people or confronting unethical practices.

  1. Request a SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis.

(Source: Forbes)

Follow the author on Twitter @natashagural

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