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T. Mellon & Sons' Bank  

BNY 2018 Hierarchy report

16 140 UNITED STATES TAX COURT REPORTS (15)
1 Bryon Christensen, John Marston, Manoj Viswanathan, Ilana Yergin,
Daniel Davis and Kristin R. Keeling all withdrew as counsel after trial.
2 All monetary amounts have been rounded to the nearest million unless
otherwise indicated.
3 All section references are to the Internal Revenue Code (Code) for the
years at issue, unless otherwise indicated.
4 There is also a question of whether respondent properly adjusted interest
expenses allocated to the foreign source income. We need not address
this issue because of our holding that the trust income reported as foreign
source income is U.S. source income.
B. John Williams, Jr., Alan J.J. Swirski, Julia M. Kazaks,
Cary D. Pugh, Andrew J. McLean, Daniel C. Davis, Melissa
R. Middleton, Shira M. Helstrom, Brendan T. O’Dell, Bryon
Christensen, 1 John Marston, Manoj Viswanathan, Ilana
Yergin, Daniel Davis, and Kristin R. Keeling, for petitioner.
Jill A. Frisch, Curt M. Rubin, Anne O’Brien Hintermeister,
Matthew J. Avon, Justin L. Campolieta, and Michael A.
Sienkiewicz, for respondent.
KROUPA, Judge: Respondent determined deficiencies in
petitioner’s Federal income tax of $100 million 2 and $115
million for 2001 and 2002 (years at issue), respectively.
There are three issues for decision. The first issue is whether
petitioner is entitled to foreign tax credits under section 901 3
claimed in connection with a Structured Trust Advantaged
Repackaged Securities transaction (STARS transaction or
STARS). We hold that petitioner is not because the STARS
transaction lacked economic substance. The second issue is
whether petitioner is entitled to deduct certain expenses
incurred in furtherance of the STARS transaction. We hold
petitioner is not for the same reason. The final issue is
whether income attributed to a trust with a U.K. trustee
used to effect the STARS transaction is U.S. source income
rather than foreign source income. We hold that the income
is U.S. source income. 4
FINDINGS OF FACT
I.
I. Background
Petitioner is a Delaware corporation that maintained its
principal place of business in New York, New York, when it
filed the petition. Petitioner succeeded to the tax liabilities of
The Bank of New York Company, Inc. (BNY Parent) when

----------------------------------
1 Bryon Christensen, John Marston, Manoj Viswanathan, Ilana Yergin,
Daniel Davis and Kristin R. Keeling all withdrew as counsel after trial.
2 All monetary amounts have been rounded to the nearest million unless
otherwise indicated.
3 All section references are to the Internal Revenue Code (Code) for the
years at issue, unless otherwise indicated.
4 There is also a question of whether respondent properly adjusted interest
expenses allocated to the foreign source income. We need not address
this issue because of our holding that the trust income reported as foreign
source income is U.S. source income.
--------------------------------------------

(15) BANK OF N.Y. MELLON CORP. v. COMMISSIONER 17
Mellon Financial Corporation merged with BNY Parent in
2007. BNY Parent was the common parent of an ‘‘affiliated
group’’ (as that term is defined in section 1504(a)) of corporations
that filed consolidated U.S. Federal income tax returns
on an accrual and calendar year basis. The Bank of New
York (BNY) was a wholly owned subsidiary of BNY Parent.
BNY was in the banking business with worldwide banking
operations. Its business activities included taking in deposits,
borrowing money and investing in loans and securities.
The affiliated group through BNY entered into the STARS
transaction in 2001 with Barclays Bank, PLC (Barclays), a
global financial services company headquartered in London,
United Kingdom. The STARS transaction generated approximately
$199 million in foreign tax credits for the combined
years at issue.
II. Introduction and Negotiation of STARS
Barclays and KPMG, an audit, tax and advisory firm,
developed and promoted STARS to U.S. banks. KPMG introduced
STARS to BNY during discussions with BNY’s tax
director. Thereafter, tax professionals at KPMG and Barclays
presented STARS to BNY through various meetings, discussions,
promotional materials and correspondence.
STARS was represented as a ‘‘below market loan’’ in
KPMG’s initial presentation. KPMG indicated that STARS
required a U.K. counterparty and a certain trust structure
holding income-producing assets. KPMG explained that the
below-market cost would be achieved by the U.K.
counterparty ‘‘sharing’’ U.K. tax benefits from STARS
through an offset to the cost of the loan. Finally, KPMG
indicated that the U.K. tax benefits would be generated by
subjecting income-producing assets held by a trust to U.K.
tax and thus generating foreign tax credits that BNY could
use to offset its U.S. tax liability.
BNY notified KPMG in August 2001 that it was prepared
to move forward with a STARS transaction with Barclays as
the U.K. counterparty. BNY proposed that it would contribute
assets that would generate $93 million of annual
U.K. tax costs and expected Barclays to reduce the loan’s
annual cost by half that amount. Shortly thereafter, BNY
agreed to supplement STARS by engaging in a ‘‘stripping
VerDate 18 140 UNITED STATES TAX COURT REPORTS (15)
transaction.’’ The effect would be to accelerate and increase
the tax benefits STARS produced (i.e., foreign tax credits).
And just before STARS closed, BNY indicated to Barclays
that it had decided to increase the targeted benefit.
MORE:

 https://www.ustaxcourt.gov/InOpHistoric/BankofNYMellonCorp.TC.WPD.pdf

BNY SUBSIDIARIES 2009

BNY SUBSIDIARIES 2010

BNY Annual ReporT 2011

BNY SUBSIDIARIES 2012

BNY  SUBSIDIARIES 2014

BNY  SUBSIDIARIES 2015

https://www.bnymellon.com/_global-assets/pdf/investor-relations/form-10-k-2014.pdf

https://www.ustaxcourt.gov/InOpHistoric/BankofNYMellonCorp.TC.WPD.pdf

IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
CALPINE CORPORATION, )
)
Plaintiff, )
)
v. ) C.A. No. 1669-N
)
THE BANK OF NEW YORK and )
WILMINGTON TRUST COMPANY, )
)
Defendants. )
OPINION
Date Submitted: November 17, 2005
Date Decided: November 22, 2005
Edmond D. Johnson, Esquire, Peter B. Ladig, Esquire, THE BAYARD FIRM, Wilmington,
Delaware; Robert P. Haney, Jr., Esquire, COVINGTON & BURLING, New York, New
York, Attorneys for Plaintiff.
M. Duncan Grant, Esquire, PEPPER HAMILTON LLP, Wilmington, Delaware; James
Gadsden, Esquire, William H. Sloane, Esquire, Karl Schaffer, Esquire, CARTER
LEDYARD & MILBURN LLP, Attorneys for Defendant The Bank of New York.
Bernard G. Conaway, Esquire, Sheldon K. Rennie, Esquire, FOX ROTHSCHILD LLP,
Wilmington, Delaware; Joseph F. Ryan, Esquire, Steven B. Levine, Esquire, Lisa M.
Kelsey, Esquire, Robert L. Harris, Esquire, BROWN RUDNICK BERLACK ISRAELS
LLP, Boston, Massachusetts; Edward S. Weisfelner, Esquire, Sigmund S. Wissner-Gross,
Esquire, BROWN RUDNICK BERLACK ISRAELS LLP, New York, New York,
Attorneys for Defendant Wilmington Trust Company as First Lien Indenture Trustee.
Richard D. Allen, Esquire, Robert J. Dehney, Esquire, S. Mark Hurd, Esquire, MORRIS,
NICHOLS, ARSHT & TUNNELL, Wilmington, Delaware; Laurence Greenwald, Esquire,
Robin Keller, Esquire, Wendell H. Adair, Esquire, STROOCK & STROOCK & LAVAN
LLP, New York, New York, Attorneys for Intervenor Wilmington Trust Company as
Second Lien Indenture Trustee.
STRINE, Vice Chancellor.
1
This is the post-trial opinion in an expedited case involving a dispute between
noteholders (through an Indenture Trustee for two different series of notes, the “First”
and “Second Lien Notes”) and the issuer of the Notes, Calpine Corporation (“Calpine”).
Calpine operates natural gas-fueled power plants that generate electricity. This litigation
centers on Calpine’s plans for the use of approximately $852 million in net proceeds from
the sale of substantially all of its oil and natural gas assets to Rosetta Resources, Inc. on
July 7, 2005 (the “Rosetta Sale”). The “Rosetta Assets” that Calpine sold were
“Designated Assets” under important instruments protecting its Noteholders. When the
Rosetta Assets were sold, the “Rosetta Proceeds” therefore were placed into a control
account and could only be used for certain purposes.
Calpine hoped to use the bulk of the $852 million in the Rosetta Proceeds to retire
all of its First Lien Notes through a tender offer offering to pay the First Lien Noteholders
par plus accrued interest. This use was mandated contractually by the indenture
governing Calpine’s first lien series of notes (the “First Lien Indenture”). Rather than
receiving tenders from all of the First Lien Noteholders, only $139 million of the $785
million in First Lien Notes were tendered,1 all of which Calpine repurchased. This left
Calpine holding $709 million in Rosetta Proceeds.
Calpine then embarked on purchases of natural gas for burning in its power plants.
To accomplish those purchases, Calpine used the form contract typically used by sellers
and purchasers of extracted natural gas — the Base Contract for the Purchase and Sale of
1 With accrued interest, Calpine paid approximately $143 million to repurchase approximately
$139 million in face amount of First Lien Notes.
2
Natural Gas promulgated by the North American Energy Standards Board (“NAESB”)
— as its foundational document (a “NAESB form contract”).2 In variance with its prior
practice, however, Calpine modified its approach to purchasing natural gas by drafting
the contracts so that it would pay an immediate price for the gas it purchased, take title
upon that payment, and keep that gas in storage until it (or gas of similar quality) was
delivered to Calpine within the brief contract term. The price that Calpine ultimately
paid typically was to be determined by price movements in the spot market during the
period up to delivery; moreover, if the seller failed to deliver all the purchased gas,
Calpine’s remedy was simply a cash payment in the amount necessary to cover through
other gas purchases. Calpine had no right to insist on a remedy involving the actual
delivery of the precise amount of gas to which it supposedly held title.
Calpine structured the contracts in this manner in order to argue that its purchase
of natural gas constituted a purchase of Designated Assets, a permissible use of the
Rosetta Proceeds under the indentures for the Second Lien Noteholders (taken together,
the “Second Lien Indenture”) once Calpine had made a qualifying tender offer to the First
Lien Noteholders. The term Designated Assets in the First and Second Lien Indentures
broadly refers to “all geothermal energy assets . . . and all . . . Gas Reserves . . . but
excluding (i) any geothermal energy assets that are both unproven and undeveloped and
(ii) contracts for the purchase or sale of natural gas and natural gas supplied under such
contracts.” After the tender offer closed, Calpine spent $313 million of the Rosetta
2 North American Energy Standards Board, General Terms and Conditions, Base Contract for
Sale and Purchase of Natural Gas, NAESB Standard 6.3.1, April 19, 2002.
3
Proceeds on natural gas for burning in its power plants and certified to The Bank of New
York (“BONY”), the relevant “Collateral Trustee,” that these purchases were of
Designated Assets.
Eventually, the Noteholders caught wind of Calpine’s purchases and complained
to BONY that Calpine’s use of the Rosetta Proceeds to buy natural gas was
impermissible because it involved the use of the Rosetta Proceeds for “contracts for the
purchase or sale of natural gas and natural gas supplied under such contracts,” and thus
did not involve the purchase of Designated Assets. After that objection surfaced, BONY
refused to further release any more of the Rosetta Proceeds to Calpine for purchases of
natural gas. Calpine therefore brought this action against BONY, as Collateral Trustee,
and the Wilmington Trust Company, as indenture trustee for both the First and Second
Lien Noteholders (collectively, the “Indenture Trustees”), seeking a declaration that its
past and proposed use of the Rosetta Proceeds to buy natural gas constitute permissible
purchases of Designated Assets.
In this opinion, I conclude that Calpine’s proffered interpretation of the relevant
exclusion from the term Designated Assets is erroneous. By any measure, Calpine is
using Rosetta Proceeds to buy “natural gas supplied under . . . [a] contract[] for the sale
or purchase of natural gas . . . .” The term used in the exclusion is an obviousreference
to a common industry term for the contracts used to buy and sell already-extracted natural
gas. Calpine itself appears to have proposed this exclusion, in order to exclude from the
definition of Designated Assets the trading activities of one of its subsidiaries. Notably,
this subsidiary, Calpine Energy Services (“CES”), was the unit that made regular, large
purchases of natural gas for burning in Calpine’s power plants, and by this exclusion,
Calpine therefore placed the gas received under those contracts outside the reach of
Designated Assets.
The contracts that Calpine has entered with the Rosetta Proceeds are materially
indistinct from the prior contracts its subsidiaries used to acquire natural gas for burning.
Calpine has never considered these prior contracts, or the natural gas acquired under
them, to be Designated Assets. The mere fact that Calpine restructured the recent
contracts in order to take “title” to the purchased gas upon contracting and before
delivery does not suffice to make those contracts anything other than what they are
plainly labeled and obviously are: “contracts for the sale or purchase of natural gas and
the gas supplied under such contracts.” Calpine’s use of the Rosetta Proceeds for this
purpose was therefore impermissible and it may not proceed to make further purchases of
this kind. Because the correct party to challenge the past purchases — the Second Lien
Noteholders — did not seek redress for the past purchases until after discovery had
closed and trial was imminent, I defer on the question of the appropriate remedy for
Calpine’s inappropriate use of $313 million of the Rosetta Proceeds although it is clear a
fitting and reasonably prompt restorative remedy is in order.
I. Factual Background
A. The Notes
In July and November 2003, Calpine issued $2.95 billion of Second Lien Notes,
governed by four substantially identical note indentures, collectively, the Second Lien
Indenture. The Second Lien Notes issued July 16, 2003, included $500 million floating
5
rate notes due 2007; $1.15 billion of 8.5% notes due 2010; and $900 million of 8.75%
notes due 2013.3 On November 18, 2003, Calpine issued the remaining Second Lien
Notes, which were $400 million of 9.875% notes due 2011. The Second Lien Notes are
secured by a second priority lien on substantially all of the assets of Calpine, including,
but not limited to, Calpine’s domestic oil and gas reserves, geothermal assets, and seven
power plant assets; 100% of the stock and other equity interests of Calpine’s first-tier
domestic subsidiaries; and a pledge of Calpine’s interests in certain of its subsidiaries (the
“Collateral”).
About fourteen months later, in September 2004, Calpine issued $785 million
principal amount of 9.625% First Priority Senior Secured Notes due 2014, that is, the
First Lien Notes.4 The First Lien Notes are secured by a first priority lien on the
Collateral and are governed by an Indenture similar in most relevant respects to the
Second Lien Indenture. Wilmington Trust Company is the Indenture Trustee under both
the First Lien Indenture and the Second Lien Indenture.
In conjunction with the issuance of Second Lien Notes, Calpine also entered into a
Collateral Trust Agreement, pursuant to which BONY was appointed Collateral Trustee
3 The Second Lien Notes are unregistered securities, initially purchased and later resold by
Goldman, Sachs & Co. (“Goldman Sachs”) and certain financial institutions in a private
placement pursuant to Rule 144A under the Securities Act of 1933. At the same time as the
issuances of the Second Lien Notes, Calpine entered into $750 million of term loans due 2007
for which Goldman Sachs Credit Partners L.P. serves as Agent. The Goldman Sachs Term Loan
Facility shares in the Collateral on a second lien basis and contains substantially similar terms to
the Second Lien Indenture, including the definition of “Designated Assets” and Asset Sale
Provisions.
4 The First Lien Notes are unregistered securities, initiallypurchased and later resold by Merrill
Lynch & Co.

for the Second Lien Notes.5 The Collateral Trust Agreement included a mechanism
whereby the representatives of additional secured debt holders could become a party to
the Collateral Trust Agreement by executing a Collateral Trust Joinder.6 When Calpine
issued the First Lien Notes, Wilmington Trust Company executed a Collateral Trust
Joinder (the “Joinder Agreement” or “Joinder”) by which it agreed to be bound by the
terms of the existing Collateral Trust Agreement. By virtue of this Joinder, the First Lien
Notes became “Priority Lien Debt”7 under the Designated Asset Sale Proceeds Control
Agreement (the “Control Agreement”) and the Collateral Trust Agreement and were
granted senior status in respect to priority of liens and repayment.
The Indentures, Collateral Trust Agreement, Joinder Agreement, and Control
Agreement constitute an integrated set of contracts that operate in concert. Taken
together, I refer to these various agreements at times as the “Instruments.” The
Instruments work together to ensure that Calpine only uses the pledged Collateral, in
particular the Designated Assets, in a manner consistent with the promises it made to its
creditors. Most relevant here, the Instruments harmonize the promises Calpine made to
the First and Second Lien Noteholders in the First and Second Lien Indentures regarding
the use of Designated Assets. Those promises are described next.
5 Originally, the Collateral Trust Agreement was entered into among Calpine, three of its
subsidiaries, the Bank of Nova Scotia (as Agent under a $500 million Credit Agreement),
Wilmington Trust Company (as Indenture Trustees), and Goldman Sachs Credit Partners L.P.
See supra note 3. Calpine used a portion of the proceeds from the issuance of the First Lien
Notes to retire completely the debt for which Bank of Nova Scotia served as Agent. Goldman
Sachs Credit Partners has been notified of this action and to date has not sought to intervene.
6 Collateral Trust Joinder Art. 3, § 3.8.
7 The term “Priority Lien Debt” is used in all the documents and includes the First Lien Notes

..........read more
https://courts.delaware.gov/opinions/(01uhya45fdcrwd45xlvqpo45)/download.aspx?ID=68920

 

"Greed will take everything from you if you let it."  jt

ITEM 2. PROPERTIES
We believe that our owned and leased facilities are suitable and adequate for our business needs. At a number of the locations described below, we are not currently occupying all of the space under our control. Where commercially reasonable and to the extent it is not needed for future expansion, we have leased or subleased, or seek to lease or sublease, this excess space. The following is a description of our principal properties, as of Dec. 31, 2014:

New York City properties In September 2014, we sold our One Wall Street office building that serves as our corporate headquarters and leased the building back under a short-term triple net lease.

In June 2014, we executed a lease for approximately 325,000 square feet of space in an office building located at 225 Liberty Street in downtown Manhattan that we anticipate will serve as our corporate headquarters once we relocate from One Wall Street in 2015.

We also own our 23story building located at 101 Barclay Street in downtown Manhattan, and lease the land on which that building sits under a ground lease expiring in 2080.

In addition, we lease approximately 313,000 square feet of space in an office building located at 200 Park Avenue and approximately 318,000 square feet of space in an office building located at 2 Hanson Place in Brooklyn.

The New York City properties are utilized by all of our business segments.

Pittsburgh properties We lease under a long-term, triple net lease the entire 54-story office building known as BNY Mellon Center located at 500 Grant Street.

In addition, we own a 42-story office building located at 525 William Penn Place and a 14-story office building located at 500 Ross Street. The Pittsburgh properties are utilized by all of our business segments.

Boston area properties We lease approximately 373,000 square feet of space in a Boston office building located at One Boston Place, 201 Washington Street.

We also lease under a triple net lease the entire 3-story office building located at 135 Santilli Highway in Everett, Massachusetts.

Additionally, we lease approximately 304,000 square feet of space at 4400 Computer Drive in Westborough, Massachusetts.

The Boston properties are utilized by all of our business segments.

Jersey City property We lease approximately 485,000 square feet of space in an office building located at 95 Christopher Columbus Drive, primarily utilized by our Investment Services segment.

United Kingdom properties We have a number of leased office locations in London (including approximately 234,000 square feet of space at BNY Mellon Centre at 160-162 Queen Victoria Street and approximately 152,000 square feet of space at The Tower at One Canada Square at Canary Wharf), as well as other leased office locations throughout the United Kingdom, including locations in Manchester, Poole, Leeds, Brentwood, Liverpool and Edinburgh.

The UK properties are utilized by all of our business segments.

India properties We lease approximately 656,000 square feet of space in Pune, India and approximately 540,000 square feet of space in Chennai, India.

The India properties are utilized by all of our business segments.

Other properties We also lease (and in a few instances own) office space and other facilities at numerous other locations both within and outside of the U.S., including properties located in New York, New Jersey, Connecticut, Pennsylvania, Massachusetts, Florida, Delaware, Texas, California, Illinois, Washington and Tennessee; Brussels, Belgium; Wexford, Dublin and Cork, Ireland; Luxembourg; Frankfurt and Dusseldorf, Germany; Wroclaw, Poland; Singapore; Hong Kong and Shanghai, China; Seoul, Korea; Tokyo, Japan; Sydney, Australia and Rio de Janeiro, Brazil.


Source: https://www.bnymellon.com/_global-assets/pdf/investor-relations/form-10-k-2014.pdf

 

 

 

BNY Mellon Settles Charges Stemming From Miscalculations of Regulatory Capital Figures
FOR IMMEDIATE RELEASE
2017-9
Washington D.C., Jan. 12, 2017—
The Securities and Exchange Commission today announced that BNY Mellon has agreed to pay a $6.6 million penalty to settle charges stemming from miscalculations of its risk-based capital ratios and risk-weighted assets reported to investors.

An SEC investigation found that BNY Mellon deviated from regulatory capital rules by excluding from its calculations approximately $14 billion in collateralized loan obligation assets that the firm consolidated onto its balance sheet in 2010. BNY Mellon never obtained Federal Reserve Board approval as required under regulatory capital rules to exclude the assets from its calculations. Due to the miscalculations and the firm’s lack of internal accounting controls to ensure its financial statements were being prepared properly, BNY Mellon understated its risk-weighted assets and overstated certain risk-based capital ratios in quarterly and annual reports from the third quarter of 2010 to the first quarter of 2014.

“Regulatory capital ratios and risk-weighted assets are critical data points for investors in large banking institutions like BNY Mellon,” said Michael J. Osnato, Chief of the SEC Enforcement Division’s Complex Financial Instruments Unit. “We will continue to aggressively focus on these kinds of disclosures to ensure that control failures do not prevent investors from receiving accurate and timely information.”

Without admitting or denying the charges, BNY Mellon consented to an SEC order finding that it violated internal controls and recordkeeping provisions of the federal securities laws, specifically Sections 13(b)(2)(A) and 13(b)(2)(B) of the Securities Exchange Act of 1934.

The SEC’s investigation was conducted by Armita Cohen and Amy Flaherty Hartman and the case was supervised by Michael Osnato, Reid Muoio, and Jeffrey Shank. The SEC appreciates the assistance of the Board of Governors of the Federal Reserve System and the Federal Reserve Bank of New York.

###

Mellon Securities Trust Company
09/12/1985 NYS Chartered Mellon Securities Trust Company
07/01/2008 Merge To State Bank of New York Mellon, The

Mellon Trust of New York
06/16/1988 NYS Chartered Boston Safe Deposit & Trust Company of New York
05/01/1997 Name Change To Mellon Trust of New York
01/03/2001 Name Change To Mellon Trust of New York, LLC
07/01/2008 Merge To Federal Mellon New York Interim National Bank

Mellon Trust of New York, LLC
06/16/1988 NYS Chartered Boston Safe Deposit & Trust Company of New York
05/01/1997 Name Change To Mellon Trust of New York
01/03/2001 Name Change To Mellon Trust of New York, LLC
07/01/2008 Merge To Federal Mellon New York Interim National Bank
 

The Bank of New York Mellon Corporation, commonly referred to as BNY Mellon, is an American multinational banking and financial services corporation formed on July 1, 2007 as a result of the merger of The Bank of New York and Mellon Financial Corporation.

The company has US$1.6 trillion in assets under management and US$27.9 trillion in assets under custody and/or administration thereby being the largest deposit bank in the world.

The company employs 51,400 staff as of March 2014 worldwide and operates in six primary financial services sectors including advisory services, asset management, asset servicing, broker-dealer, issuance services, treasury services and wealth management.


Man who fell from BNY Mellon building committed suicide
Pittsburgh Post-Gazette logo
PITTSBURGH POST-GAZETTE
9:30 PM MAR 30, 2010
An autopsy of a man who died Monday after falling from the BNY Mellon Building Downtown confirmed that he committed suicide.

Thomas Senchisen, 37, of the North Side, was pronounced dead at 4:34 p.m., minutes after falling from the 54-story building near Ross Street. Pittsburgh homicide detectives said their investigation indicates Mr. Senchisen intentionally jumped to his death. An autopsy performed Tuesday indicated that he died from blunt force trauma.

An emergency dispatch supervisor said initial reports were of a man who had fallen from the building around 4:30 p.m.

Mr. Senchisen was a 10-year employee of the Mechanical Operations Co., which provides maintenance for the building.

A spokeswoman said the company would have no comment on the death.


http://www.post-gazette.com/local/city/2010/03/30/Man-who-fell-from-BNY-Mellon-building-committed-suicide/stories/201003300258




It is the oldest banking corporation in the United States, with origins stretching back to the establishment of the Bank of New York in 1784 by Alexander Hamilton.http://en.wikipedia.org/wiki/The_Bank_of_New_York_Mellon

Bank of New York came into existence in the year 1784, focusing on the needs of businesses and the management of wealth in understanding the complexity of the world's financial markets.

The bank merged with Mellon Financial Corporation in 2007 and till today the bank continues providing financial services under the new name Bank of New York Mellon.

Headquartered in New York, BNY Mellon is a global leading asset management and securities providing company, uniquely intended to help individuals, organizations, institutions, governments and several other clients manage their financial assets and help thrive in the complex global market.

The bank has $21.8 trillion in assets under custody and $1 trillion under management.

Operating in as many as 36 countries, the bank serves in more than 100 market locations worldwide with a workforce of more than 49,000 worldwide.

The bank provides a wide array of asset management, asset servicing and securities services solutions to help institutions and corporations build assets, enhance performance, improve operating efficiency and reduce risk.

 To the individuals the bank provides financial solutions such as wealth management, private banking, mortgage programs and shareowner services. http://www.onlinebanksguide.com/bny-bank-of-new-york-mellon/

We have evolved in many ways since our founding in 1784, but our commitment to the true innovative spirit of our founder, Alexander Hamilton, remains the same. It’s the driving force behind our legacy of firsts and what continues to push us forward into the future.

The Buck Started Here
Started by Alexander Hamilton in 1784, BNY Mellon is one of the longest-lasting financial institutions in the world. We have endured, been innovative and went on to prosper through every economic event and market move over the past 230 years.
READ TRANSCRIPT (PDF - 169 KB) https://www.bnymellon.com/us/en/who-we-are/our-story.jsp

When Citifinancial ,supposedly, paid off all owing Washington Mutual- Mellow Bank sent Janice Sanford a check, dated March 15, 2007, for $1.70-with only "Payoff  Overage" on MEMO line-no account #.

 I recently lost a mortgage suit to Citifinancial..... who presented a computer printout of payment history, with included, according to Citifinancial wittiness, information that Washington Mutual Finance had been paid off

Records on file in the Clerk of Court's off show that Washington Mutual never filed mortgage release. The witiness also made the claim that there were NEVER any assignment or sale of the mortgage note- I have original letters to prove that was not true.

There is a doublewide trailer on the property, that was foreclosed on, which I have the titles to in my possession.

Citifinancial(owned by Citigroup) lawyers even wanted that ADDED on to the property being foreclosed on.

I presented the titles in court. Attached to the titles is this note, apologizing ,my titles were found in back file.

A summery of what Magistrate judge said:

He could understand if I had argued that i should have been paying, Washington

Mutual......

I informed the court that, I had only recently learned, from court records, that Washington Mutual's mortgages[ made prior to Washington Mutual  SWITCHING its name to Citifinancial]  had not filed  any mortgage releases.

The court simply took Citifinancial's word that the Washington Mutual mortgage had been paid off, someone just hasn't filed lien release.

To say the least, after setting in the courtroom and hearing the judge, through his legal authority

take other people's home away from them, I was not surprised when the he gave my daughter 90 days to leave the property.

Of course, with me holding the titles to the trailer and the note showing that it is not  apart of the property note being foreclosed on, I got to keep the trailer [ which will cost 1000s of dollars to moved the few hundred feet it needs to be moved...And then there is the problem of keeping the property ,that it would set on, from being taken away by the courts in the other mortgage foreclosure case, which is presently in the court too.

I was cautioned by the Magistrate judge that if I pursued the matter, by disagreeing with his order, that I might lose not only the property but my trailer as well.

I'm not an attorney. It is not the trailer that matters to me .... America, truly is, being destroyed from within-by those who took an oath of office, to defend her. The sad thing is Every American now live under the threat of communism at its best..

to be continued......

BNY Mellon, A Vision of Growth and a History of Performance
Through Good Times and Bad

BNY Mellon's history of providing distinguished service spans 225 years. Founded in 1784, soon after the birth of the new American republic, our history is inextricably woven into the broader history of the nation.

Two of our leaders, during different centuries, played key roles in the development of the American government and economy, helping to shape the nation and the prosperity enjoyed by its citizens and businesses.

Alexander Hamilton, one of America's founding fathers and a highly respected New York attorney, personally wrote the company's constitution and, during the early years, remained the individual most actively involved in the organization. Hamilton's economic vision and firm grasp of financial principles served the company well. Hamilton went on to become the first U.S. Secretary of the Treasury and a member of George Washington's first cabinet.

Less than a century later, this focus on driving business development was amplified by Andrew Mellon, whose willingness to fund and invest in new business startups helped launch the American industrial revolution. Mellon became one of America's foremost financiers, industrialists and philanthropists. As with Hamilton, in time Mellon was appointed U.S. Secretary of the Treasury, a position he held under three U.S. Presidents.

From the beginning, we have embraced the changes and challenges that face our clients and helped them navigate the increasing complexity of the world's financial markets. This tradition of focusing on the needs of businesses and the management of wealth has served BNY Mellon well for 225 years. And it is our goal to continue to do so well into the future.

http://www.bnymellon.com/about/history/index.html http://web.archive.org/web/20130823095325/http://www.bnymellon.com/about/history/index.html

Russia sues Bank of New York for 22.5 bln usd
05.17.07, 8:29 AM ET

MOSCOW (Thomson Financial) - Russia's Federal Customs Service has filed a 22.5 bln usd lawsuit against the Bank of New York for money laundering, a lawyer for the service told AFP.

'From 1996 to 1999, the Bank of New York (nyse: BK - news - people ) took part in a money laundering scheme in which the Russian Federation suffered 22.5 bln usd worth of harm,' lawyer Maxim Smal said after filing the suit at Moscow's arbitrage court.

tf.TFN-Europe_newsdesk@thomson.com

afp/cml
http://web.archive.org/web/20081202170950/http://www.forbes.com/markets/feeds/afx/2007/05/17/afx3731121.html

Fortune Magazine: Legal Pad


Russia settles suit against U.S. bank for a pittance

After two years, a racketeering case is reaching what may be a profitable conclusion for Bank of New York Mellon.

By Roger Parloff, senior editor

Last Updated: September 22, 2009: 11:25 AM ET


NEW YORK (Fortune) -- A bizarre and troubling civil racketeering case filed against the Bank of New York Mellon by the Russian customs service -- ostensibly brought under U.S. law but filed in a Moscow court -- may be coming to an unexpectedly rational end.

In remarks this morning to the State Duma, the lower house of Parliament, Russia's Finance Minister Alexei Kudrin announced that the case, in which Russia had sought $22.5 billion from the bank, would be settled for about six ten-thousandths of that sum, or $14 million, which Kudrin described as "trial expenses."

Once the case is settled, the bank has pledged to enter into a five-year, trade finance agreement whereby it would extend $400 million in loans to Russian banks at a rate of 2.5% above LIBOR, with debts coming due every six months.

In a report issued this morning by Rochdale Research, bank analyst Richard Bove is calling the settlement "a home run" for the bank, and the loan deal "a profitable piece of business" in itself.

Russia's lead lawyer in the case has been Steven C. Marks, an American plaintiffs lawyer at Miami's Podhurst Orseck. But Finance Minister Kudrin appeared to repudiate Marks' theory of the case in his remarks to the Duma, according to both American and Russian wire service reports, calling the evidence "insufficient to win this kind of case."

Marks did not respond to Fortune's messages seeking comment.

The bank's lead outside lawyers -- Jonathan Schiller and Damien Marshall of Boies Schiller & Flexner -- also had no comment, nor did the bank's executive vice president and deputy general counsel Matthew L. Biben, who has been overseeing the case.

Marks had theorized that the bank was criminally responsible for a scandal perpetrated in the late 1990s by one of the bank's vice presidents, Lucy Edwards. Edwards and her husband pled guilty in 2000 to having helped Russian depositors illegally wire transfer $7.5 billion out of that country via Bank of New York accounts.

Though federal prosecutors investigated the bank for complicity, they chose not to prosecute. Instead, in November 2005 the bank accepted "responsibility" for having failed to adequately monitor Edwards and agreed to pay the U.S. government a $14 million fine, representing ten times its revenue from the wire transfer fees ($1.4 million) generated by Edwards's scheme. (The $14 million the bank will now pay the Russian government is obviously a conscious echo of the sum paid the U.S. government.)

Marks had theorized that by entering into this non-prosecution agreement in 2005, the bank had admitted criminal culpability in Edwards' scheme. Though nothing in the non-prosecution agreement said that, a government press release issued at the time did mistakenly contain language to that effect. (In August 2008, more than a year after Marks filed suit, the Manhattan U.S. Attorney's Office corrected the press release -- deleting the language Marks frequently quoted -- and affirming in a separate letter that the bank had never admitted criminal liability. Nevertheless, Marks never altered his position.)

In May 2007, Marks, whose retainer agreement calls for him to receive 29% of any recovery, brought a civil suit on behalf of the Russian Federal Customs Service under the U.S. Racketeer Influenced and Corrupt Organizations (RICO) Act, seeking $22.5 billion. But rather than file it in federal court in Manhattan, the expected venue, he brought it in the Moscow Arbitrage Court, a Russian commercial court.

Marks' suit alleged, among other things, that Russia had been cheated out of tax and customs duties on the depositors' funds that had been transferred. (Russia never identified any taxes actually evaded, however. Indeed, when the scandal originally broke in 1999, Russian officials downplayed the gravity of what Edwards had done, suggesting that most of her transfers hadn't violated Russian law.)

Had Marks filed the case in Manhattan, it would have faced severe obstacles, including, first, an apparently expired four-year statute-of-limitations and, second, a federal judicial doctrine barring foreign taxing authorities from using U.S. courts to collect foreign tax and customs duties.

By bringing the case in the Moscow Arbitrage Court -- one of a very few instances in which anyone has tried to bring a RICO case outside the United States court system -- these problems were averted. Indeed, the choice of forum was deeply concerning for the bank, because many experts on Russian law believe that arbitrage courts simply lack the judicial independence to be able to rule against the Russian government in a high-stakes case. (For a feature story I wrote in Fortune about this case in September 2008, click here.)

The suit has now been seemingly stuck in the ordinarily fast-moving arbitrage court for more than two years, with the judge, for many months now, urging the parties to settle.

Piecing together wire service accounts from Reuters and Novosti RIA, Kudrin appears to have said the following in his remarks this morning to the Duma:

"Previously, the US Government had brought a case against Bank of New York for money laundering but never found the bank to be guilty of laundering. . . . As a result Bank of New York paid the Government for costs associated with the court case, for mistakes made by some of its employees. This was not a payment in recognition of having committed laundering; in this case the sum would have been much greater. . . . Subsequently, the Russian Federal Customs Service decided to try to prove in a Russian court that laundering took place in the United States with the alleged participation of Russian companies. This type of data or material, simply on the basis of the original legal proceedings in the United States, is insufficient to win this kind of court case. This is why at the moment, as far as I know, the two sides needed to settle, and to pay for certain costs."

Kudrin also characterized the bank's commitment to make the trade-finance agreement as an "act of good will, to demonstrate the bank's desire to work with Russia." He added, "guilt has not been proven and the settlement will be signed.

Read the complete Legal Pad archive To top of page

First Published: September 16, 2009: 4:23 PM ET

http://archive.fortune.com/2009/09/16/news/companies/russia_bank_new_york.fortune/index.htm



Bank of New York's $22.5 billion headache

The Russian government is suing the Bank of New York for smuggling cash out of the country. Can a U.S. bank get a fair trial in Moscow?

By Roger Parloff, senior editor

Last Updated: September 24, 2008: 7:22 AM ET

(Fortune Magazine) -- Inside a rundown government building on Novaya Basmannaya Street in Moscow, a bizarre lawsuit is playing out involving $7.5 billion in illicit money transfers and America's ninth-largest bank.

The Russian government is suing the Bank of New York Mellon (BK, Fortune 500) under the U.S. civil RICO statute - the Racketeer Influenced and Corrupt Organizations Act - seeking $22.5 billion.

And what a cast of characters. Russia is represented by a Miami plaintiffs lawyer who specializes in airplane crash cases, whose experts include Harvard law professor Alan Dershowitz. The bank's defense is being led by Jonathan Schiller, a founding partner of super-lawyer David Boies's law firm, Boies Schiller & Flexner, and he has assembled his own phalanx of experts, led by former U.S. Attorney General Richard Thornburgh.

In the suit the Russian Federal Customs Service seeks to recover taxes it says it should have collected on the $7.5 billion that one of the Bank of New York's employees helped smuggle out of the country about a decade ago. The bank maintains that the case has no merit.

What makes the dispute unique is that Russia has filed the suit not in "any appropriate United States district court," as the RICO statute contemplates, but in a Russian court. Moscow's commercial court is widely regarded as not only a place susceptible to corruption but one in which judges simply lack the judicial independence required to rule against important state interests.

While a judgment in Moscow might well not be enforceable in the U.S., the Bank of New York does business in more than 100 countries, and the judgment would almost certainly be enforceable in some of them. Moreover, as a multinational operation, the Bank of New York does not relish the prospect of defying any country's judiciary. After an 80-year presence in Russia, it also dreads the prospect of having to pull out now, when Russia is the world's sixth-largest economy, its second-largest producer of oil, and a global superpower once again.

The case raises a larger issue: Can any Western company get a fair shake in the Russian court system when the adversary is the Russian government?

In recent years Russia has often used the selective enforcement of its laws to advance policy objectives - most notably the nationalization of natural resources. From 2003 to 2006 it cited tax claims as the basis for seizing the assets of Yukos, then its largest oil company; in 2006 it alleged environmental violations in forcing Shell (RDSA), Mitsui (MITSY), and Mitsubishi (MSBHY) to cough up half their stake in their Sakhalin Island oil franchise; and in recent months it has invoked transgressions of labor, migration, and tax laws to wring concessions from the Western half of the TNK-BP (BP) oil joint venture, including the ouster of its American CEO, Richard Dudley.

Yet the Bank of New York suit might also reflect a quirkier, narrower agenda. Russia's President, Dmitry Medvedev, has acknowledged that his nation's courts sometimes become the tool of powerful individuals. As the Financial Times reported in June - citing Moscow sources - "the Bank of New York case could not have got this far without support from a high-level 'sponsor' in government, the security services, or business - or one well connected in all three areas."

How high up in the Russian government hierarchy does one need to go to get approval to sue an American bank for $22.5 billion? Louise Shelley, an expert on the Russian legal system at the George Mason School of Public Policy in Arlington, Va., says, "The head of the customs service wouldn't have approval to do something like this on his own." Approval probably came, she says, from "somewhere in the Kremlin." [NOTE: IT WAS 4 PAGES LONG BUT 3 HAD BEEN REMOVED.0]http://archive.fortune.com/2008/09/23/news/companies/parloff_bank_new_york.fortune/index.htm?postversion=2008092407

 

Bank of New York Mellon

Bank of New York Mellon logoBank of New York Mellon Corp. (BNY Mellon) is a global financial services company formed on 1 July 2007 as result of the merger of The Bank of New York and Mellon Financial Corporation. BNY Mellon is a leading provider of financial services for institutions, corporations and high-net-worth individuals, providing superior asset management and wealth management, asset servicing, issuer services, clearing services and treasury services through a worldwide client-focused team. Total assets: US$ 325.27 billion (as of December 31, 2011). Net income: US$ 2,518 million (2010), US$ 2,516 million (2011)

http://www.banksdaily.com/info/bnymellon


We are BNY Mellon

BNY Mellon is a global investments company dedicated to helping its clients manage and service their financial assets throughout the investment lifecycle. Whether providing financial services for institutions, corporations or individual investors, BNY Mellon delivers informed investment management and investment services in 35 countries and more than 100 markets. As of December 31, 2013, BNY Mellon had $27.6 trillion in assets under custody and/or administration, and $1.6 trillion in assets under management. BNY Mellon can act as a single point of contact for clients looking to create, trade, hold, manage, service, distribute or restructure investments. BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation (NYSE: BK). Additional information is available on www.bnymellon.com, or follow us on Twitter @BNYMellon.
http://www.bnymellon.com/about/index.html

Company Profile

Established 1784
History
Headquarters One Wall Street
New York, NY 10286
USA
Ticker Symbol NYSE: BK
Investor Relations
Client Assets US $1.6 trillion under management*
US $27.6 trillion under custody or administration*
Locations 35 countries, serving more than 100 markets worldwide*
Worldwide Locations
Chairman and CEO Gerald L. Hassell
Employees 51,100 worldwide*
Key Facts and Financials BNY Mellon At a Glance

*As of December 31, 2013

http://www.bnymellon.com/about/companyprofile.html


OVERVIEW

The Bank of New York Company, Inc. (NYSE: BK) is a global leader in
providing a comprehensive array of services that enable institutions and
individuals to move and manage their financial assets in more than 100 markets
worldwide. The Company has a long tradition of collaborating with clients to
deliver innovative solutions through its core competencies: securities
servicing, treasury management, investment management, and individual &
regional banking services. The Company's extensive global client base
includes a broad range of leading financial institutions, corporations,
government entities, endowments and foundations. Its principal subsidiary,
The Bank of New York, founded in 1784, is the oldest bank in the United States
and has consistently played a prominent role in the evolution of financial
markets worldwide.



The Company has executed a consistent strategy over the past decade by
focusing on highly scalable, fee-based securities servicing and fiduciary
businesses, with top three market share in most of its major product lines.

The Company distinguishes itself competitively by offering the broadest array
of products and services around the investment lifecycle. These include:
advisory and asset management services to support the investment decision;
extensive trade execution, clearance and settlement capabilities; custody,
securities lending, accounting and administrative services for investment
portfolios; and sophisticated risk and performance measurement tools for
analyzing portfolios. The Company also provides services for issuers of both
equity and debt securities. By providing integrated solutions for clients'
needs, the Company strives to be the preferred partner in helping its clients
succeed in the world's rapidly evolving financial markets.

The Company has grown both through internal reinvestment as well as
execution of strategic acquisitions to expand product offerings and increase
market share in its scale businesses. Internal reinvestment occurs through
increased technology spending, staffing levels, marketing/branding
initiatives, quality programs, and product development. The Company
consistently invests in technology to improve the breadth and quality of its
product offerings, and to increase economies of scale. With respect to
acquisitions, the Company has acquired 93 businesses since 1995, almost
exclusively in its securities servicing and fiduciary segment. The
acquisition of *Pershing in 2003 for $2 billion was the largest of these
acquisitions.

As part of the transformation to a leading securities servicing provider,
the Company has also de-emphasized or exited its slower growth traditional
banking businesses over the past decade. The Company's more significant
actions include selling its credit card business in 1997 and its factoring
business in 1999, and most recently, significantly reducing non-financial
corporate credit exposures by 47% from December 31, 2000 to December 31, 2004.
Capital generated by these actions has been reallocated to the Company's
higher growth businesses.

3

The Company's business model is well positioned to benefit from a number
of long-term secular trends. These include the growth of worldwide financial
assets, globalization of investment activity, structural market changes, and
increased outsourcing. These trends benefit the Company by driving higher
levels of financial asset trading volume and other transactional activity, as
well as higher asset price levels and growth in client assets, all factors by
which the Company prices its services. In addition, international markets
offer excellent growth opportunities.

http://www.getfilings.com/o0000009626-05-000128.html


*About Us

Pershing is committed to supporting the success of our clients. We provide you and your investors with a strong foundation for growth, and deliver industry-leading technology and innovative solutions to help you grow your business without limits.

Leadership

Pershing is the industry's largest global business solutions provider, with more clients who clear with us than with any other firm1. We offer unequaled experience built over seven decades of serving financial organizations of every size and business model.

Strength

You can gain confidence from our financial position. Pershing has over $1 trillion* in global client assets. Our parent company, BNY Mellon has $27.6 trillion* in assets under custody and/or administration.

Scale

Pershing's market leadership enables us to make an exceptional investment in your success. We offer state-of-the-art technology, a highly reliable and scalable infrastructure, and a host of innovative products and services to help you expand your offering.

Commitment

We exclusively serve financial organizations, money managers, and registered investment advisors, with no retail lines of business to distract us, and no proprietary trading for our own book of business. Our success completely depends on yours.

Service

Our story begins and ends with our people. Pershing invests in a high-touch, dedicated service model, and takes a consultative approach to helping you succeed. Our long associate tenures let you build lasting relationships with experienced professionals who know your business.

Caring is the foundation of our commitment to serve our clients worldwide, and each other. Our Client Care Standards help each of us fulfill a personal responsibility to deliver service excellence.
1.We strive to anticipate our clients' needs and provide personalized, reliable service.
2.We take pride in our work and seek to continually enhance our clients' experiences.
3.We always aim to treat our clients with dignity and respect and look to demonstrate a high regard for their diverse points of view.
4.We continuously aspire to take ownership for client satisfaction.
5.We work as a team and with a collaborative spirit across the firm to deliver service excellence in all that we do.

Global Reach
We are the industry's largest global outsourcing provider, serving more than 300 international financial organizations and doing business in more than 60 markets. Turn to us for a one-stop, full-service global solution with integrated, multicurrency clearing and execution, plus a full range of global resources.

1 Source: Investment News datebook, 2013

* As of December 31, 2013.

http://www.pershing.com/about_us/index.html

http://www.bnymellon.com/

Surprise: Citigroup replaces Smith Barney with Pershing, not Fidelity

Posted by RJ & Makay on December 16, 2010
citigroup, custody-agent, deborah-mcwhinney, fidelity, mark-tibergien, pershing, ria, weatlh-management

--------------------------------------------------------------------------------
Surprise: Citigroup replaces Smith Barney with Pershing, not Fidelity
Citigroup surprised the financial world recently when it announced Jersey City, N.J.-based Pershing, LLC would be its clearing/custody agent as well as the backbone of its RIA business. Fidelity, which is located in Boston, had originally been named as the front-runner for the job.

As part of the deal, Pershing's RIA custody arm, Pershing Advisor Solutions, will support a Citigroup referral network that advisors have long been anticipating. Deborah McWhinney, Citigroup’s president of personal banking and wealth management, said the Citigroup plans to refer high-net-worth customers on the banking side to RIAs that Citi Personal Banking and Wealth Management chooses. Because Pershing is managing the referral network, it may be better able to get its advisors named as recipients of those referrals.

The goal, said McWhinney, is to revive Citigroup's ability to serve affluent clients, which suffered greatly after the Smith Barney/Morgan Stanley merger in 2009. Because of the merger, Citigroup lost its large sales force and was no longer in a position to handle the avalanche of leads its $30 billion in assets under management could potentially generate.

Indeed, Citigroup had only about 600 advisors after the merger and, in June, the company said the number would drop even lower -- to around 450 -- after attrition and layoffs of low producers and new hires. The attrition was due in part to the imposition of fee-based compensation in place of transactional-based pay. According to anonymous sources, Citigroup said it would charge a flat annual 20% of an RIA’s fee on the referred assets.

Although the Citigroup-Pershing deal was a surprise, both companies could benefit greatly from it. As an exclusive arrangement, the deal may be particularly helpful in expanding Citi's already large asset base and boosting its brand. Pershing could win big because the deal improves its ability to attract RIAs who want referrals to the Pershing platform.

Notably, McWhinney is a close friend of Mark Tibergien, CEO of Pershing Advisor Solutions, so it’s not surprising that she would be comfortable choosing Pershing. The two executives knew each other when McWhinney was head of Schwab’s RIA custody business until 2007 and Tibergien headed the practice management consulting business at Moss Adams.

Citigroup has not yet specified how many RIAs would be joining its referral network, but said it was in “advanced discussions” with top RIA firms around the United States. It did reveal that New York and San Francisco would likely be the initial two test markets for the program.

Critics of the Citigroup-Pershing deal have said McWhinney is trying to pull off a referral scheme that has often been attempted with only limited success. Schwab, TD Ameritrade, and Fidelity, for example, have all tried something similar and found it very challenging.

Source:
Pershing wins Citigroup account and will support its RIA referral network ( http://www.riabiz.com/a/4911038

 )

RJ & Makay
http://www.rjandmakay.com/rj-and-makay-blog/1093-surprise-citigroup-replaces-smith-barney-with-pershing-not-fidelity/



Was Billionaire Ackman Right To Sell Citigroup, Buy Procter & Gamble?

Oct. 4, 2012 10:13 AM ET | About: C, Includes: BAC, JNJ, JPM, PG

By Matt Doiron

In July, billionaire Bill Ackman wrote to investors in Pershing Square Capital Management that it had sold all of its shares of Citigroup Inc. (C) and used the capital to take a position in The Procter & Gamble Company (PG). Pershing Square had begun carrying out this plan during the second quarter of 2012 - at the end of June it only owned 1.1 million shares of Citigroup, down from 26 million at the beginning of April, and has initiated a position of 22 million shares in Procter & Gamble.

At the time, we didn't think that this was a good substitution, concluding that Ackman was likely expecting a global recession (in which case a consumer staples business would be an obvious pick over a financial stock) but that even low to moderate growth would lead to a rebound at Citigroup. Since the news of Ackman's sale of Citigroup Inc. broke on July 12, the stock is up 33%; since the end of June, it is up 23%; since the middle of the second quarter, it is up 21%. The Procter & Gamble Company? Up 8% since July 12, 13% since the end of June, and up 8% since the middle of the second quarter. Even if P&G is credited for its larger dividend yield (3.2% on an annual basis) its returns have fallen well short of Citi's. True, Pershing Square has taken less risk in the process - Ackman specifically referred to problems in the financial sector, which emphasized that one bad event could cause large declines in Citi's stock price, and actually still thought the bank was cheap - but at this point the trade looks like a loss.

Even after the gains in its share price, Citigroup Inc. still trades at only half the book value of its equity. It probably does warrant a discount to book value, but joins its peer Bank of America Corp (BAC) as likely still being priced too low in terms of book value (Bank of America trades at about 40% of book value). In terms of forward earnings Citigroup is clearly cheaper than its peers, with its P/E multiple of 7 comparing favorably with Bank of America's 10 and JPMorgan Chase & Co.'s (JPM) 8. JPMorgan Chase also trades much closer to the book value of its equity, at a P/B of 0.8. Admittedly Citigroup is losing revenue and earnings, with both down in its most recent quarter compared with a year ago, and JPMorgan Chase is in the same boat as well. Still, we actually like all three of these banks at their current prices, as they are considerably cheaper than others in the industry. Andreas Halvorsen's Viking Global increased its stake in Citigroup during the second quarter to a total of 8.4 million shares.

Procter & Gamble's revenue was about flat last quarter compared with the same period in the previous year, but earnings surged 45%. The company now trades at 19 times trailing earnings; even with the dividend yield, and taking into account that the stock's beta of 0.3 limits an investor's downside, this suggests that the market is pricing in high growth in the future. The forward P/E is 16, which would represent something pretty close to what we think would be fair value if the company can hit that target. Warren Buffett's Berkshire Hathaway (BRK.A) was a major shareholder at Procter & Gamble at the end of June, though the holding company did sell shares during the second quarter. The Procter & Gamble Company is best compared with Johnson & Johnson (JNJ), which saw a large decline in its earnings in the second quarter versus Q2 2011and now trades at 22 times trailing earnings. The sell-side expects a return to normalcy, and the forward P/E of 13 beats Procter & Gamble's (again, assuming the company can meet expectations). The 3.5% dividend yield is also about in line with its peer. Even after the recent rise in financial stocks, we would prefer any of the three banks - including Citigroup - to either of these companies.

Source: Was Billionaire Ackman Right To Sell Citigroup, Buy Procter & Gamble?


http://seekingalpha.com/article/904371-was-billionaire-ackman-right-to-sell-citigroup-buy-procter-and-gamble




Pershing wins Citigroup account and will support its RIA referral network

The win is 'huge' and affirming of NetX360 because the account is big, branded and exclusive, analysts say

Thursday 12.16.10 by Brooke Southall
NetX360 | Pershing | Smith Barney | Citigroup | McWhinney | Palaveev | Tim Welsh


In a surprise move, Citigroup has chosen Pershing LLC as its clearing agent and the backbone of its RIA business.

The New York-based money center bank will use the Jersey City, N.J.-based clearing and custody company to replace Smith Barney in 2011 after its merger with Morgan Stanley. Fidelity had originally been named as the front-runner for the deal that appears to involve tens of billions in assets now and potentially much more in the future. Boston-based Fidelity declined comment.

Pershing Advisor Solutions, the RIA custody arm of the clearing firm, will support a referral network that’s been much anticipated in the advisory community. The plan was first laid out in October 2009 by Deborah McWhinney, Citi’s president of personal banking and wealth management.


She said Citi plans to refer high net worth customers on the banking side to RIAs that Citi Personal Banking and Wealth Management chooses. (McWhinney, 55, has moved to another position within CitiGroup since then and no replacement has been named.)

Leg up?

Because Pershing is managing the referral network, it may have a leg up in getting its advisors named as recipients of the mega-bank’s leads, according to an analyst.

McWhinney’s move is designed to ramp up the capacity of her company to serve affluent clients. Smith Barney’s merger meant that Citi lost its big sales force. In October of 2009, when McWhinney disclosed the plan, Citi had only 600 branch brokers and $30 billion of assets under advisement which is not nearly enough manpower or expertise to handle the volume — and in some cases sophisticated needs — of a potential avalanche of leads. See:Citigroup puts RIAs at the center of its strategy to retain banking clients

In June, the company said that after attrition, layoffs of low producers and new hires, Citi would have even fewer advisors: 450, according to an article by Jed Horowitz in InvestmentNews. The attrition related in part to the imposition of fee-based compensation in place of transactional-based pay. Citi said it would charge a flat annual 20% of an RIA’s fee on the referred assets, according to the InvestmentNews article. This information was from an anonymous source in the article. See: Citi advisors seek potential suitors after McWhinney’s tectonic pay shift

Citigroup had not responded to email and phone requests for an interview by the time of publication (though if we hear today, we’ll add the company’s thoughts). Pershing Advisor Solutions, which has about $80 billion of assets in custody, also declined requests for an interview. But Pershing’s spokeswoman Barbara Gallo issued a statement to RIABiz confirming the deal and what her company’s role will be in it.

“Pershing is delighted to have the opportunity to expand its relationship with Citi…by supporting its global Private Bank and Wealth Management businesses as they transition from self clearing to a fully disclosed relationship with Pershing,” she says. “Pershing will be supporting aspects of Citi’s global brokerage, advisory and corporate RIA services. Pershing Advisor Solutions will support the referral network planned for its RIAs.

“We look forward to delivering our comprehensive breadth of investment product choices, services and technology solutions to help their private bankers continue to serve their diverse client base well and grow their businesses.”

Watershed

The deal is a watershed for Pershing and Citi, according to two consultants.

“Because it’s an exclusive arrangement, it’s a big brand and a big asset base at Citi, it’s a huge win for Pershing,” says Timothy Welsh, president of Nexus Strategy of Larkspur, Calif.

The deal is a major affirmation of all the work that Pershing has done to create a multi-faceted platform (encompassing NetX360) for fee and transactional business, according to Philip Palaveev, president of Fusion Advisor Network. Looking ahead, it’s potentially even bigger because it adds a new dimension to Pershing as it seeks to attract RIAs to its own platform, he added.

“It should generate opportunities for Pershing to attract RIAs who want to be recipients of referrals. Advisors went to Schwab, Fidelity and TD Ameritrade for referrals (from their retail branches).”

NetX360 is the platform technology that Pershing is using as part of its efforts to show that it can handle the holistic needs of broker-dealers who need RIA capabilities. Suresh Kumar, Pershing’s managing director, chief information officer and a member of the executive committee heads the effort. See:Pershing believes its case for NetX360 as the Apple equivalent for advisors is solid

In an earlier interview, McWhinney had named Fidelity as having the inside track on winning the Citi clearing and custody account because it could couple its offering with National Financial Services. At the time, Charles Goldman, who worked under McWhinney at Schwab, was head of the custody unit at Fidelity. He left there in March.

McWhinney and Tibergien ties

McWhinney is also very close personally with Mark Tibergien, CEO of Pershing Advisor Solutions, so it’s not surprising that Pershing would also be a comfortable choice for her, Welsh said. The two executives knew each other when McWhinney was head of Schwab’s RIA custody business until 2007 and Tibergien headed Moss Adams’ practice management consulting business. See: Mark Tibergien is making Pershing an industrial strength custodian with an RIA service touch

Citi is building the referral bridge to RIAs because its trust department and a private banking unit is geared to the ultra-affluent — not the merely high net worth investor, according to what Alex Samuelson, spokesman for Citi, said in an interview last Fall.

At the time McWhinney declined to specify how many RIAs would join in the referral program but Citi said that the company was in “advanced discussions” with top RIA firms around the United States. The two test markets for these referrals are likely to be New York and San Francisco, according to McWhinney

“We’ll see how many we need,” she said.

Still Palaveev cautions that McWhinney is trying to pull off a referral scheme that has been oft attempted and met with limited success.

“It’s going to be challenging as Schwab, TD and Fidelity have shown but they have an ambitious business plan and we can all keep our fingers crossed,” he said.
http://www.riabiz.com/a/4911038/pershing-wins-citigroup-account-and-will-support-its-ria-referral-network 

 

 

BNY Mellon has a History with Russia



October 7th, 2011
in econ_news



from-russia-with-love Econintersect: Yesterday GEI News reported on the suits by New York City, New York State, the U.S. Attorney’s office in New York and several other states to recover damages from Bank of New York Mellon for currency trading fraud alleged over a ten-year period. Reader RH has brought to our attention another interesting case brought against BNY Mellon four years ago by the Russian government, who accused the bank on money laundering.

Follow up:
According to Global Research (May 18, 2007):



The Federal Customs Service filed a lawsuit in Moscow on Thursday seeking $22.5 billion in damages from the Bank of New York for suspected money laundering, the service and its lawyer said.

The lawsuit could be linked to the money laundering charges brought against former Yukos chief Mikhail Khodorkovsky and his business partner Platon Lebedev earlier this year, a member of their defense team said.

The bank, the world's second-largest custodian of investor assets, dismissed the claims as being "totally without merit" and promised to mount a vigorous defense.

Customs service lawyer Maxim Smal accused the bank of involvement in "an illegal scheme" that helped Russian businesses bring money into Russia without paying taxes from 1996 to 1999, Interfax reported. He filed the lawsuit with the Moscow Arbitration Court.

The customs service confirmed the filing of a lawsuit against the Bank of New York in a statement later in the day, and said it would reveal more details at a news conference Friday.

The lawsuit stems from a confession by former BNY vice president Lucy Edwards in 2000, which followed a lengthy U.S. investigation into suspicious transactions at the bank, Smal said.

Several accounts that existed at the bank in the 1990s, Edwards said, were part of an illegal network that allowed Russian businesses to defraud their government of customs duties and tax revenues by transferring funds in and out of Russia in violation of currency controls.

Twenty-eight months later, the New York Times reported on September 16, 2009 that the BNY Mellon and the Russian government agreed to settle the case for the payment of Russia’s legal fees plus an additional $14 million. The Times indicated that this was far less than the $1 billion settlement that the Russian government had sought.

That is quite a comedown from the initial complaint for $22.5 billion in 2007.

The NYT gives some additional background. It seems that the Russian complaint was filed some two years after the U.S. government settled a different money laundering suit against the bank:

The[Russian] case spun out of the bank’s huge money laundering scandal of the late 1990s. A group of trial lawyers in Miami took the case on a contingency fee for the Russian government after the Bank of New York reached a $14 million settlement with the American government in 2005.

The bank conceded a rogue employee had laundered $7.5 billion from Russia through the bank in the 1990s, but said it had admitted no criminal wrongdoing.

It is curious that the going “kickback” from BNY Mellon for multibillion dollar money laundering schemes seems to be $14 million.

Another excerpt from the NYT discloses an additional curiosity:

Separately, the Bank of New York agreed to offer a line of credit to Russian state banks to finance import and export business, the finance minister, Aleksei L. Kudrin, said in testimony to Parliament. The $400 million loan on favorable terms, though, would be an “act of good will” not formally linked to the settlement, he said. “It has nothing to do with costs of the court case, and is not an admission of guilt.”

Source: Global Research.ca and The New York Times
http://econintersect.com/b2evolution/blog1.php/2011/10/07/bny-mellon-has-a-history-with-russia



LINK TO INTERESTING PAGE... http://www.bnymellonmarketeye.com/tag/russia/