Banks and investment funds across the world lined up on Monday to admit investing billions of dollars in the companies of Bernard Madoff, whom US authorities accused of masterminding a massive fraud.
Britain’s HSBC was the latest bank to join the growing list, saying it had exposure of around $1 billion, making it one of the biggest victims of the alleged $50 billion fraud. Royal Bank of Scotland and Man Group in the UK, Japan’s Nomura and France’s Natixis also said they were hit by the worldwide scandal.
Financial companies, reeling after a year of enormous writedowns on bad credit assets, have so far tallied up more than $10 billion in direct and indirect exposure to the possible fraud by Madoff, the 70-year old trader who was arrested on Thursday. “There is a broader danger here for the industry,” an equity analyst said.
“This huge fraud, supposedly in blue-chip funds, is going to make people nervous, and you’ve already seen massive redemptions,” the analyst said. Shares in France’s Natixis were down 4.7% after it said it had as much as E450 million ($605 million) of exposure to the fiasco. The wider DJ Stoxx banking index was 0.9% lower.
US prosecutors and regulators have accused Madoff, a former chairman of the Nasdaq Stock Market, of running the fraud through his investment advisory business, which managed at least one hedge fund. Man Group, the world’s largest listed hedge fund manager, said it was exposed to Madoff through its fund of funds business RMF, which has $360 million invested in funds directly or indirectly sub-advised by Madoff. BNP Paribas and Santander detailed potential losses on Sunday, and others joined at the start of the trading week, with Italy’s UniCredit showing exposure of around E75 million.
RBS said its potential loss could amount to some £400 million ($595 million), if it assumed that the value of its assets in Madoff’s firm were nil.
Its exposure to the scandal was through trading and collateralised lending to funds of hedge funds invested in the group, the bank said in a statement.
Hedge funds are already struggling after a year that has badly damaged their boast that they can make money whichever way the market turns.
Source: Agencies
Showing posts with label reveal. Show all posts
Showing posts with label reveal. Show all posts
Tuesday, December 16, 2008
Thursday, November 27, 2008
Mumbai attacks: Are other cities not vulnerability?
Whatever group lies behind the attacks in Mumbai, security experts say one thing has been made abundantly clear: a massive city can be reduced to mayhem if a group of men is well-enough armed and prepared to die.
Rather than hijacking planes as in September 11, or smuggling delicately wired car bombs into a city, the Mumbai gunmen chose a frontal style of armed assault, killing more than 100 people, wounding around 250 and causing immense panic in a thriving city of 13 million.
Security specialists say the attack was probably months in the planning and appears to have been finely tuned in its execution, but it ultimately relied on only an estimated 25 gunmen lightly armed with assault rifles and hand-grenades.
Their ability to roam around and sustain the attack, while all the while being willing to die in the onslaught, made it all the more difficult to combat and far more drawn out than an instantaneous suicide bomb attack might have been.
"It's virtually impossible to stop 20 guys with guns from attacking anywhere in the world if they are prepared to die," said Sajjan Gohel, an analyst with the Asia-Pacific Foundation, an independent security and intelligence group based in London.
"That is the thing about the fedayeen strategy," he said, using an Arabic term used to describe self-sacrificial gunmen who have operated in Iraq, Kashmir and across the Muslim world.
"It's even more effective than a suicide mission. With a suicide mission, you blow up your explosives and you're gone. With a fedayeen attack, you try to last out as long as possible, killing as many people as possible," he told Reuters.
Nearly 20 hours after the attack began late on Wednesday night, Indian soldiers and the militants were still exchanging gunfire and more than 100 people were trapped inside the Taj Mahal hotel, one of two five-star hotels popular with Western tourists and businessmen that were targeted in the assault.
Indian authorities closed stock, bond and foreign exchange markets, schools were shuttered and panicked foreigners on holiday or on business were desperate to flee, reducing India's business powerhouse to a tense, semi-warzone.
"Men armed with automatic weapons are able to run amok and keep the situation going for much, much longer," Henry Wilkinson, a senior analyst with Janusian Security Risk Management, a London-based consultancy, told Reuters.
"Whether it's intended or not, that creates an extended drama which is all the more terrifying."
AL QAEDA
Given the boldness of the assault, its high-level of planning and the fact that foreigners were specifically targeted, security specialists believe there is likely to have been a degree of inspiration from or link to external groups allied to Al Qaeda, such as the Pakistan-based Lashkar-e-Taiba.
They say the tactics are different from the more common, post-9/11 attacks seen in Iraq and Afghanistan, but still bear similar hallmarks.
"It's very interesting that they didn't go in using car bombs, it was more of a direct armed assault on a city," said Wilkinson. "It's very reminiscent of the attacks in Saudi Arabia in 2003, when the gunmen were going around trying to find Westerners and kill them."
Wilkinson highlighted the fact the Mumbai gunmen appeared to have used only assault rifles and hand-grenades, giving them much more mobility and freeing them up to take hostages.
"I would suggest that using guns and hand-grenades was a deliberate choice... The amount of planning and training they must have done to carry out such an attack is impressive."
Such an assault might be mounted virtually anywhere in the world, he said, making cities in Europe and the United States vulnerable, even if such an outcome remains unlikely.
In London in 2005 four suicide bombers killed 52 people on public transport and brought the city to a standstill.
Both attacks underline just how hard it is for democratic states to protect themselves against such attacks without draconian security measures and powerful intelligence.
"I can't see any reason -- if there is a terrorist group that has the capability... attacks like this in Europe or the United States can't be discounted," he said.
One advantage for Indian authorities and any intelligence services called in to help investigate the Mumbai attacks is that at least nine gunmen are reported to have been seized.
In a suicide bombing, forensics can help investigators establish only so much. In this case, those detained are likely to reveal much more intelligence about who plotted the attack.
"The fact that a few of them have been seized is highly significant," said Wilkinson. "I think a lot more information about these attacks and who was behind them is going to come to light."
Source: Reuters
Rather than hijacking planes as in September 11, or smuggling delicately wired car bombs into a city, the Mumbai gunmen chose a frontal style of armed assault, killing more than 100 people, wounding around 250 and causing immense panic in a thriving city of 13 million.
Security specialists say the attack was probably months in the planning and appears to have been finely tuned in its execution, but it ultimately relied on only an estimated 25 gunmen lightly armed with assault rifles and hand-grenades.
Their ability to roam around and sustain the attack, while all the while being willing to die in the onslaught, made it all the more difficult to combat and far more drawn out than an instantaneous suicide bomb attack might have been.
"It's virtually impossible to stop 20 guys with guns from attacking anywhere in the world if they are prepared to die," said Sajjan Gohel, an analyst with the Asia-Pacific Foundation, an independent security and intelligence group based in London.
"That is the thing about the fedayeen strategy," he said, using an Arabic term used to describe self-sacrificial gunmen who have operated in Iraq, Kashmir and across the Muslim world.
"It's even more effective than a suicide mission. With a suicide mission, you blow up your explosives and you're gone. With a fedayeen attack, you try to last out as long as possible, killing as many people as possible," he told Reuters.
Nearly 20 hours after the attack began late on Wednesday night, Indian soldiers and the militants were still exchanging gunfire and more than 100 people were trapped inside the Taj Mahal hotel, one of two five-star hotels popular with Western tourists and businessmen that were targeted in the assault.
Indian authorities closed stock, bond and foreign exchange markets, schools were shuttered and panicked foreigners on holiday or on business were desperate to flee, reducing India's business powerhouse to a tense, semi-warzone.
"Men armed with automatic weapons are able to run amok and keep the situation going for much, much longer," Henry Wilkinson, a senior analyst with Janusian Security Risk Management, a London-based consultancy, told Reuters.
"Whether it's intended or not, that creates an extended drama which is all the more terrifying."
AL QAEDA
Given the boldness of the assault, its high-level of planning and the fact that foreigners were specifically targeted, security specialists believe there is likely to have been a degree of inspiration from or link to external groups allied to Al Qaeda, such as the Pakistan-based Lashkar-e-Taiba.
They say the tactics are different from the more common, post-9/11 attacks seen in Iraq and Afghanistan, but still bear similar hallmarks.
"It's very interesting that they didn't go in using car bombs, it was more of a direct armed assault on a city," said Wilkinson. "It's very reminiscent of the attacks in Saudi Arabia in 2003, when the gunmen were going around trying to find Westerners and kill them."
Wilkinson highlighted the fact the Mumbai gunmen appeared to have used only assault rifles and hand-grenades, giving them much more mobility and freeing them up to take hostages.
"I would suggest that using guns and hand-grenades was a deliberate choice... The amount of planning and training they must have done to carry out such an attack is impressive."
Such an assault might be mounted virtually anywhere in the world, he said, making cities in Europe and the United States vulnerable, even if such an outcome remains unlikely.
In London in 2005 four suicide bombers killed 52 people on public transport and brought the city to a standstill.
Both attacks underline just how hard it is for democratic states to protect themselves against such attacks without draconian security measures and powerful intelligence.
"I can't see any reason -- if there is a terrorist group that has the capability... attacks like this in Europe or the United States can't be discounted," he said.
One advantage for Indian authorities and any intelligence services called in to help investigate the Mumbai attacks is that at least nine gunmen are reported to have been seized.
In a suicide bombing, forensics can help investigators establish only so much. In this case, those detained are likely to reveal much more intelligence about who plotted the attack.
"The fact that a few of them have been seized is highly significant," said Wilkinson. "I think a lot more information about these attacks and who was behind them is going to come to light."
Source: Reuters
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