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US sues to seize US$1 bln of stolen Malaysian funds; HSBC managers charged over fx fraud; big Aussie non-bank merger; ASIC tells banks to "raise the culture bar"; UST 10yr yield at 1.59%; oil unchanged, gold lower; NZ$1 = 70.2 US¢, TWI-5 = 74.4

US sues to seize US$1 bln of stolen Malaysian funds; HSBC managers charged over fx fraud; big Aussie non-bank merger; ASIC tells banks to "raise the culture bar"; UST 10yr yield at 1.59%; oil unchanged, gold lower; NZ$1 = 70.2 US¢, TWI-5 = 74.4

Here's my summary of the key events overnight that affect New Zealand, with news of aggressive regulator actions around the world.

In Los Angeles, the US Justice Department is seeking to seize more than US$1 bln in assets bought with money that it believes was stolen from the Malaysian sovereign wealth fund. The Malaysian prime minister always seems to be at the center of these allegations, but this lawsuit does not name him. But a relative, a Malaysian financier and two Abu Dhabi government officials are named. The claim is the money was embezzled from the fund and moved around the world using secretive shell companies that masked its trail, and invested in American real estate, art and other luxury goods. And ironically, also claimed are the rights to the movie "The Wolf of Wall Street" which was partly funded as part of the fraud.

And in New York, a senior HSBC manager has been arrested as he got off a plane and charged alongside a former foreign exchange executive with engaging in a scheme to front-run a US$3.5 bln transaction by one of the bank's clients.

In Australia, two non-bank lenders are to merge to offer more competition to the main mortgage lenders. The joint business will lave loans of about AU$13 bln and has a presence in New Zealand.

And banks in Australia have been told to "raise the culture bar". ASIC boss Greg Medcraft has put the banks on notice, saying trust and confidence in the system is at stake.

Back in New York, UST 10yr yields are unchanged today now at 1.59%.

The US benchmark oil price is also pretty much unchanged, now just under US$45/barrel and the Brent benchmark is just over US$47/barrel.

But the gold price is lower, down $10 to US$1,318/oz.

The NZ dollar is also lower especially against the greenback, now at 70.2 US¢, at 93.9 AU¢, and at 63.8 euro cents. The TWI-5 index is now at 74.4.

If you want to catch up with all the local changes yesterday, we have an update here.

The easiest place to stay up with event risk today is by following our Economic Calendar here ».

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5 Comments

While I have no doubt there are other motivations behind the moves, I am pleased to see the American authorities acting against the movement of stolen money, and illegal behaviour. There is a strong message here. The question is now who are they turning a blind eye to?

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That word comprehensive just keeps popping up!
Associate Finance Minister Steven Joyce said: ".........., one thing we'd definitely agree on is a comprehensive response ..." Rest easy NZ
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=116…

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I couldn't agree more! The "halo effect" of the bubble on the provincial centres near Auckland etc. is offsetting the rural downturn, thus keeping the Government's approval ratings up. There's no incentive for Key to do more than duck-shove the blame for the bubble onto some other agency.

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"Trust and confidence", who needs that in a banking system?

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If true, the fraudulent funding of "The Wolf of Wall Street" is really funny!!!!

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