US regulators sue RBC. “You’re constantly doing things that in hindsight someone can come along and conclude differently,” says one bank analyst.
US regulators sue RBC. “You’re constantly doing things that in hindsight someone can come along and conclude differently,” says one bank analyst.
I wrote a blog post this morning on this subject: How to deflect attention from Jon Corzine and MF Global: Charge a Canadian bank
This isn’t FATCA-related, but does show how the US likes to be the jolly enforcer when they can’t even work out something as simples as “SEGREGATION OF CLIENT FUNDS!” That one is such a no-brainer, and I can’t understand why the CFTC is holding back.
@petros
missed your unique editorializing skills.
Seems like Canada is quite often the US’s punching bag as they never want to take responsibility for their own actions. Brings to mind a very satirical song from the South Park series called, you guessed it.. “Blame Canada!”
http://youtu.be/5JX4gWcWRAo
@zucchero81
LOL. Don’t you just love it when every headline about Canada down there starts with “Oh, Canada”, followed by what we’re whining to them about at the time?
From just reading some more recently published articles this case smells really bad from the US perspective. Canadian regulators for example were given no notification that a lawsuit was about to be filed.
@tim. Don’t have a great deal of knowledge in these matters, but the fact that US regulators didn’t do what they usually do by contacting their Canadian counterparts, then offering to settle prior to the launch of the suit kind of smells bad to me. RBC says that this matter will be more damaging to their reputation than anything else. It may benefit the US to have the reputation of a few Canadian tarnished with FATCA looming.
@bubblebustin
‘It may benefit the US to have the reputation of a few Canadian tarnished with FATCA looming.’ I fear I might be starting to get paranoid but I really smell something very suspicious here. Could the US be hoping to use this legal action against a huge Canadian bank as some sort of club to get our government to agree to the FATCA regulations.
@tiger
Re: “I really smell something very suspicious here. Could the US be hoping to use this legal action against a huge Canadian bank as some sort of club to get our government to agree to the FATCA regulations.”
It’s not a club, it’s a bargaining chip. The US is setting the table, heavily slanted of course toward their interests. So far we have Volcker, FATCA, and the RBC suit. I reckon there’s more to come. Maybe something around establishing more common border security mechanisms between the US, Canada and Mexico.
When the only tool you have is a hammer everything starts to look like a Canadian.
All I’ll say for now is that Gary Gensler, the head of the CFTC is a former Treasury Dept Official and a close personal friend of Tim Geithner.
@all, me thinks along the same lines, hence the headline “let the spin begin”. Bloomberg’s article has RBC guilty as charged: http://www.bloomberg.com/news/2012-04-02/rbc-sued-by-u-s-regulators-over-wash-trades-seeking-tax-benefit.html
@ Tim US regulators are part of the cesspool of corruption.
I just received this from someone at RBC Dominion. It’s their official response to the allegations:
http://www.rbc.com/newsroom/2012/0402-cftc.html
UPDATE:
Apparently a “settlement” has been reached:
http://www.theglobeandmail.com/report-on-business/international-business/us-business/rbc-to-pay-35-million-over-us-regulators-trading-scheme-lawsuit/article22147572/