Banks: Fiduciary Responsibility Or Not?
You mean they're not market makers and in fact allocated trades to their benefit and client's detriment? Isn't that something like Hillary Clinton's cattle futures "trading"?
Bank of New York Mellon Corp. has been fighting accusations that it took advantage of clients while trading currencies. A Wall Street Journal analysis of more than 9,400 trades the bank processed over the past decade for a large Los Angeles pension fund could provide ammunition to its critics.
BNY Mellon priced 58% of the currency trades within the 10% of each day's trading range that was least favorable to the fund, the analysis shows. As a result, the trades cost the pension fund, the Los Angeles County Employees Retirement Association, $4.5 million more than if the average trade occurred at the middle of the trading range for each day, the analysis showed.
This sounds kinda like a bank that takes your deposits and checks and re-orders them to create as many overdraft fees as possible, doesn't it
But the bank said there was nothing improper about the practice. It said clients like the Los Angeles pension fund knew—or should have known—that the bank doesn't act in their interests when pricing the trades.
Ah, that's a nice defense: If it's possible for us to..
Read the full analysis here.
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