For BlackHatJack and others: the promised State Street update.

[IdesOfOctober]

BlackHatJack,

As promised last night, here is the update.

Due in large part to the efforts of YKW, http://news.google.com/news?hl=en&tab=wn&ned=us&q=%22state+street+corporation%22">State Street is now facing increased regulatory scrutiny, class action lawsuits from pension plans, and other very unpleasant examinations. As http://www.sec.gov/cgi-bin/browse-edgar?company=&CIK=stt&filenum=&State=&SIC=&owner=include&action=getcompany">recent regulatory filings clearly show, the company is facing the ire - and the legal firepower - of http://www.google.com/search?hl=en&q=%22state+street%22+alaska+%22bond+fund%22+sued">very large institutional clients, including some progressive states' public pension plans. I especially commend your attention to the 8-K, 10-Q, UPLOAD, and CORRESPONDENCE filings from the past 12 months.

My understanding is that YKW's partner is sponsoring another shareholder proposal for inclusion in the 2008 proxy statement for State Street. He's successfully pushed through majority votes on a number of these measures, forcing by-law changes, election of all directors each year (instead of staggered terms), etc.

My understanding is that YKW has given Erin Brokovich a run for her money, in terms of the damning documents he's uncovered for the class action law firms seeking the retirees' recovery of assets.

You may recall that I noted http://www.google.com/search?q=idesofoctober+card+bombshell&hl=en&filter=0">a link between the CEO of State Street and Andy Card, and indicated that there was a link between MSM questions posed to the White House regarding that relationship and Card's sudden, abrupt resignation. I stand by that, and foresee some very serious charges arising from the events that took place with respect to the Enron pension funds.

In short, too many institutional clients are now coming forward with the same recurring tales of pension misconduct and malfeasance for even the Bush Administration to ignore. Perhaps more importantly (and I know we're speaking the same language here), the statutes of limitations on the predicate acts have not run, and won't before the next Administration can clean house at DOJ and SEC.

Ides

[KoKo]

1. Are you speaking in "Code" or could you clue the rest of us into what you are posting about...

:shrug:

[IdesOfOctober]

3. No, but it's a complex issue.

State Street services many pension funds (maybe even yours; you can find out at http://www.freeerisa.com/">FreeERISA.com, by looking up your plan's http://www.freeerisa.com/5500/Form5500.asp?mode=SEARCH">5500 filing).

BHJ followed this a while back, and asked about it last night during the debates on another thread.

Ides

[conscious evolution]

2. Thanks for the update.

Nice to see that some action is being taken.

[IdesOfOctober]

4. Lawsuits are still a fine tool for moving stuff like this along.

But without the evidence, often obtained by gumshoe instincts, the lawsuits would go nowhere.

Ides

[flashl]

5. K&R n/t

[Blackhatjack]

6. My money is on the Institutional Investors... they almost always win.

Didn't State Street 'settle' with numerous states' retirement funds in confidential agreements? Like Alaska?

Is there a timetable for events so we can be on the lookout for the next round of fireworks?

THanks for posting the OP!!

[IdesOfOctober]

7. Often, that's the case.

"Didn't State Street 'settle' with numerous states' retirement funds in confidential agreements? Like Alaska?"

Yes.

"Is there a timetable for events so we can be on the lookout for the next round of fireworks?"

I am currently keeping the link to STT's regulatory filings very, very close at hand. The company's annual meeting is typically the third Wednesday in April. YKW's partner's proposal this year could spark an SEC action.

Did you see in the news/regulatory filings about the high-level departure? That was the head of the asset management division, SSgA, where YKW worked.

"THanks for posting the OP!!"

I didn't forget.

Any follow-up questions, fire away.

Ides

[IdesOfOctober]

8. Forgot to mention that union pension funds are involved too.

In 2002, http://www.sec.gov/Archives/edgar/data/93751/000009375102000023/proxy2002.htm">The Amalgamated Bank LongView Collective Investment Fund sponsored a shareholder proposal at STT (see page 26 of the proxy statement).

As you may or may not know, YKW has strong ties to the executive leadership of the AFL-CIO, including Legal.

Incidentally, http://www.sec.gov/Archives/edgar/data/93751/000119312506051789/ddef14a.htm">YKW's partner took that same proposal across the finish line for the unions, forcing the redemption of State Street's poison pill in 2006 (see page 40). The http://www.sec.gov/Archives/edgar/data/93751/000110465906051533/a06-15557_110q.htm#Item4_SubmissionOfMattersToAVoteO_210412">vote tally was a lopsided disaster for management.

The involvement of union pension funds in this latest imbroglio bodes ill for STT. They're not interested in quiet settlements, from what I understand.

Ides

[DemReadingDU]

9. Ides! Thank you for the updates about State Street

We have missed your postings! Happy New Year!

P.S. What is YKW? I have googled, and can't find anything except: You Know Who?

LOL

[IdesOfOctober]

10. You're welcome.

Happy New Year to you as well. I have some time on my hands; it's been a busy many months. I needed a vaca.

"P.S. What is YKW? I have googled, and can't find anything except: You Know Who?"

The Internets hath served thee well.

:toast:

Ides

[CorpGovActivist]

29. Confirmed n/t

[CorpGovActivist]

30. .

[Laurab]

11. K&R even though this is quite complex, just for Ides

I know it's worth reading if long-lost Ides posted it!

PS: SOMEONE owes me a response to a PM.

[IdesOfOctober]

12. Uh-oh.

Don't sic the puppies on me. *eyelash bat*

The latest developments are good news, bottom line. I'll attend to that PM.

Ides

[Laurab]

13. Well, just for that, I'm giving it another kick.

Where's your partner-in-crime CGA? He was always quite good at explaining the State St. stuff.

:kick:

[IdesOfOctober]

14. Thanks.

Probably winding down his weekend with his partner.

I could probably take a stab at explaining it in smaller chunks tomorrow. If you read the links in the OP, then hit me up with any questions, that'd be good.

Ides

[Laurab]

17. Well it could be the pain medicine....

or that I'm not all that bright. I know it's something that's been going on for a long time, and I remember Dave posting a bunch of posts about it, and I KIND of understood, but it seems a lot more complicated now.

[IdesOfOctober]

20. Loopy Laura is on pain meds.

I'm sorry you're in pain.

A very simple bottom line is that the company invested some supposedly safe bond funds in some very risky things. Workers and retirees who thought they were investing in "low risk" investments found out otherwise, and now their plans are wise to a lot of other shenanigans that STT has pulled, too.

Once people start losing money, they tend to start paying attention to that little voice of reason in their own head, and they really start paying attention when a voice of reason outside their head provides them with smoking gun documents showing intentional malfeasance.

Hope I caught you between loops.

:hug:

Ides

[Laurab]

23. Well I kind of like the medicine, but if I remember correctly

this affects a LOT of people, who don't know they're affected, is that correct?


Oh and it would be Loopy Lori and once again you are PM challenged!:hug:

[CorpGovActivist]

28. Leave Him Alone...

... he's had a rough year. His tights don't even fit him anymore - they're all slack and bunched up.

:rofl:

(Hell yeah, I'll kick him when he's down. So rarely is the boot on the other foot.)

Yup, it affects a lot of unsuspecting American families, and is tied up in all those funny money instruments that the financial services folks were playing fast and loose with.

Look up http://www.google.com/search?hl=en&q=siv+structured+investment+vehicle">SIVs and http://www.google.com/search?hl=en&q=cdo+collateralized+debt+obligation">CDOs.

Then, look up http://www.google.com/search?hl=en&q=siv+structured+investment+vehicle+%22state+street%22">SIVs and http://www.google.com/search?hl=en&q=cdo+collateralized+debt+obligation+%22state+street%22">CDOs, with "State Street" added in to the mix.

Guess who runs the biggest "http://www.google.com/search?hl=en&q=%22state+street%22+conduit">conduit"?

That's sort of like saying: guess who runs the crookedest casino?

- Dave

[Laurab]

31. Oh, you never should have told me.

I'm usually nice, but he did disappear for a year or so, so I'd kick him, too! :hide:

In the google list, there's a long post on DU about State St thats NOT by you guys, from August - something about 4 conduits. I'm glad I don't have any money, but I don't even know where my hubby's accounts are.

Oh, you asked me to guess - does it start with an "S"? Maybe end with a "t"?

I forgot that the two of you were the Kings of Links, but now it's all coming back to me...........

[CorpGovActivist]

32. To Be Fair...

... he's been doing incredibly important work.

He'll rally soon enough.

"In the google list, there's a long post on DU about State St thats NOT by you guys, from August - something about 4 conduits. I'm glad I don't have any money, but I don't even know where my hubby's accounts are."

If you want help looking up your hubby's plan, PM me.

You guessed correctly.

"I forgot that the two of you were the Kings of Links, but now it's all coming back to me"

Well, *he's* like a bad penny.

:rofl:

- Dave

[IdesOfOctober]

34. YAWN!!!!

This vaca thing is lovely.

I am the Padishah Emperor of Links.

Ides

[CorpGovActivist]

35. Watch the Notch! n/t

[IdesOfOctober]

41. You've been waiting four years to say that, haven't you?

[CorpGovActivist]

43. Nope. It Came to Me. n/t

[DemReadingDU]

36. Good morning! I do have a question

actually two questions.

I have seen city plans in California, Florida, Connecticut, Massachusetts, Montana, Maine and King County, Washington also have disclosed investments in SIVs.
http://www.bloomberg.com/apps/news?pid=20601103&sid=a22h5SFL8vWU&refer=news

1. Wouldn't disclosure of the companies involved with these risky pension plans be discussed in the news somewhere like the city plans above? Otherwise, if we don't get a letter from our company's pension plan telling us our pension is reduced, how are we going to know the plan has lost money (other than by looking at the ERISA links to find our pension plan)?


2. There was something discussed last year about the method of voting. Something about a slick way of a person voting with more shares than were supposedly held. If the person involved with a risky pension plan that generated so much money, would that person be entitled to vote with more shares? Maybe I am confused trying to relate these 2 questions together? Or maybe these phantom shares are generated by a unique method of electronic registration?


Thank you! Hope you are enjoying your vacation!


:hi:

[IdesOfOctober]

42. I'm cogent enough to tackle these now.

"1. Wouldn't disclosure of the companies involved with these risky pension plans be discussed in the news somewhere like the city plans above? Otherwise, if we don't get a letter from our company's pension plan telling us our pension is reduced, how are we going to know the plan has lost money (other than by looking at the ERISA links to find our pension plan)?"

The companies involved with the SIVs, CDOs, and conduits have come in for a lot of media scrutiny already; and they will even more this quarter. More and more companies are required to divulge their Tier 1, 2, and 3 instruments (ranging from easily priced/liquid, to "SWAG" pricing). David could probably run circles around me on the regulatory requirement that makes that so.

Definitely protect yourself by looking up the links to your plan at FreeERISA.com.

"2. There was something discussed last year about the method of voting. Something about a slick way of a person voting with more shares than were supposedly held. If the person involved with a risky pension plan that generated so much money, would that person be entitled to vote with more shares? Maybe I am confused trying to relate these 2 questions together? Or maybe these phantom shares are generated by a unique method of electronic registration?"

Again, I defer to David. But, it has to do with book-entry bookkeeping, instituted in the late 60s. Look up DTCC and "Cede & Co" (pronounced seedy, for real).

"Thank you! Hope you are enjoying your vacation!"

I got tired of running on fumes.

Ides

[DemReadingDU]

44. Hm, how do we protect ourselves?

Do we get body armor, wear bullet-proof vests? lol


If I am already receiving a pension, and it is affected by this subprime mess, how can the pension be protected before it becomes worthless? Can a person withdraw the remaining balance in a pension, and transfer it to a savings account?

[IdesOfOctober]

45. Don't panic.

"If I am already receiving a pension, and it is affected by this subprime mess, how can the pension be protected before it becomes worthless?"

Really. Don't panic.

"Can a person withdraw the remaining balance in a pension, and transfer it to a savings account?"

The tax consequences vary by age, with 59.5 being one of the key ages. Don't do anything hasty. Talk to a tax advisor. Feel free to PM me with specifics.

Ides

[DemReadingDU]

46. I assume State Street is not the only bank managing pensions

My small pension from my former employer is managed by State Street and CitiStreet. But my spouse has a union pension and we are worried that it may be managed poorly.

Do you know of other investment companies who manage pension plans that are involved in this subprime mess?

What about Cook and Bieler, or Manning and Napier, or Key Trust, or Harris or Columbia, or AXA, or Hewitt?

Thank you Ides

[IdesOfOctober]

47. Correct.

"My small pension from my former employer is managed by State Street and CitiStreet."

CitiStreet is a 50/50 joint venture between Citi and State Street. BEWARE!

"But my spouse has a union pension and we are worried that it may be managed poorly."

Which? PM if you prefer.

"Do you know of other investment companies who manage pension plans that are involved in this subprime mess?

What about Cook and Bieler, or Manning and Napier, or Key Trust, or Harris or Columbia, or AXA, or Hewitt?"

For publicly-traded companies, check out their SEC filings. I can walk you thru a crash course on what to look for.

Ides

[DemReadingDU]

48. crash course, excellent!

Where would we go for further research into these publicly-traded companies? What do we look for in their SEC filings? Thank you!

edited to ask for a tutorial
:)

[IdesOfOctober]

50. Couldn't be easier, once you get the hang of it.

Start at the http://www.sec.gov/index.htm">SEC website, which contains lots of FASCINATING reading.

:boring:

Wake up, make a pot of coffee, and then go to "http://www.sec.gov/edgar/searchedgar/webusers.htm">Search for Company Filings," under the blue heading of "Files & Forms (EDGAR)."

Take a big swig of coffee, and make a choice: (1) go to "http://www.sec.gov/edgar/searchedgar/companysearch.html">Companies & Other Filers," or (2) go to "http://searchwww.sec.gov/EDGARFSClient/jsp/EDGAR_MainAccess.jsp">Full-Text Search."

I recommend option 1 at first. The problem with option 2 is, well, if you look up AXA, for example, you'll get not only their filings, but every filing in which they're mentioned. If you need to look up a company's stock ticker, there are online ticker lookups that are painless.

Let's start with http://www.sec.gov/cgi-bin/browse-edgar?company=&CIK=axa&filenum=&State=&SIC=&owner=include&action=getcompany">AXA, since you AXA'ed about it.

Now, you've got all those form numbers, which look like gibberish. You'll soon know a Form 4 from a DEF14A in no time. Way back on the SEC homepage, there is a "http://www.sec.gov/info/edgar/forms/edgform.pdf">Description of SEC Forms" link. You might wanna keep that open in another window to refer to (even old pros do it for really oddball or rare filings).

OK. You can get around, you can figure out the form(s) you might want to look at, so now what?

Abandon all hope. These things are written by some of the most mealy-mouthed lawyers on the planet.

But seriously, take any given issue you're worried about. Read the financial press descriptions of that crisis or problem. Learn the lingo. Then start typing in some keywords.

Let's go back to http://www.sec.gov/cgi-bin/browse-edgar?company=&CIK=axa&filenum=&State=&SIC=&owner=include&action=getcompany">AXA.

Say you want to look at their latest quarterly report. Those are either 10-Q, or 10-K (the quarter ending their fiscal year is the annual report, so the 10-K takes the place of the 10-Q). See the upper righthand corner? Type in 10 for form type, to broaden the search to include both types.

You should get 0 results.

Confused? That's because AXA is a foreign company. Only domestic US companies file 10's.

Go back, and look down the list of descriptions. You'll see 13F-HRs, which are the quarterly holdings filings that AXA files, detailing the insurer's stock portfolio, held and invested as a corporate entity (as an insurer, AXA seeks to bring more in in premiums and return on investment than it pays out in claims). You'll also see 6K's and 20-F's. Those are akin to a domestic company's quarterly reports. So, to see just the 6's, go back up in the righthand corner and type 6. Now you've got an uncluttered collection to look back thru.

Clear as mud, right?

Honest, it takes practice, and it takes asking questions. Don't be shy.

Ides

[DemReadingDU]

54. Got it!

Similar to the link that in the OP for STT recent regulatory filings...

http://www.sec.gov/cgi-bin/browse-edgar?company=&CIK=stt&filenum=&State=&SIC=&owner=include&action=getcompany


I can substitute AXA for STT in the above link, and as you said...there are no Form 10 reports. But I appreciate all the additional fascinating facts about the SEC.

:)

[IdesOfOctober]

59. Cool.

Don't hesitate to ask if you run into a roadblock.

Ides

[conscious evolution]

55. LOL!

'Abandon all hope. These things are written by some of the most mealy-mouthed lawyers on the planet.'

Mealy mouthed is right.
But once you figure out the code it all comes clear.

Most filings are long reports that will bore you to tears.But hidden away in them are some real nuggets.

Also,take notes of names in ownership filings.You will notice how a lot of the same names keep popping up.Also keep an eye on addresses.

[DemReadingDU]

57. Ugh, I have browsed some of those filings

Boring is right, unless you know the secret code.

:boring:

[IdesOfOctober]

60. Good advice.

Once you learn to read between the lines, the signals are very easy to read for investing and shareholder activism purposes.

Ides

[DemReadingDU]

61. Note to self: read more SEC filings

need to learn the signals and secret codes for shareholder activism purposes

:)

[IdesOfOctober]

62. The one upside is that stories like these become easier to follow.

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=389&topic_id=2630515&mesg_id=2630515

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=389&topic_id=2630799&mesg_id=2630799

You also learn to ask the right questions, and make informed investing decisions based on the filings.

Ides

[DemReadingDU]

63. Yes, indeed! Thanks for the heads-up

From a chance glance reading yours and Dave's postings in October 2006, I have become more aware of the deep corruption in this current administration. From the high turnout of voters in Iowa and New Hampshire, it looks like thousands of voters are wanting a change in government.

:toast:

[IdesOfOctober]

64. I'll drink to that.

:toast:

Ides

[conscious evolution]

66. It is not so much a code

It is more along the lines of reading between the lines and recognizing the spin they are using to deflect attention.
Think Clear Sky Initiative or No Child Left Behind.They use similar distortions of legalese to hide unpleasant facts.

[IdesOfOctober]

67. Euphemistic kabuki dances.

[IdesOfOctober]

40. Just you wait.

Just you wait and see what Edna does with my new tights.



Ides

[IdesOfOctober]

39. Loopy Lori, your Inbox runneth over.

I know your real name, just didn't want to blow your cover.

Yup, it affects literally millions of American families, lots of Canadian ones too.

Ides

P.S. I told you the location in your PM.

[CorpGovActivist]

33. Don't Take It Personally...

... he falls off the radar with closest friends, too.

- Dave

[Lugnut]

15. K&R n/t

[DemReadingDU]

16. morning kick

:)

[Buttercup McToots]

18. Howdy Doody?

Hoots Ides!!!
:hi:

[IdesOfOctober]

21. Buttercup!

How be ye?

How be the family?

Good holidays?

Ides

[DemReadingDU]

25. Hi Buttercup!

How's it going?

:)

[CorpGovActivist]

27. HEY!

I owe you a letter.

- Dave

[Richard Steele]

19. K&R

[CorpGovActivist]

22. I Can Confirm...

"My understanding is that YKW's partner is sponsoring another shareholder proposal for inclusion in the 2008 proxy statement for State Street."

My partner *has* submitted another shareholder proposal.

"He's successfully pushed through majority votes on a number of these measures, forcing by-law changes, election of all directors each year (instead of staggered terms), etc."

Yup. I'll never forget the time we got called for comment on this story ("http://www.boston.com/business/articles/2004/12/23/directors_feel_the_heat/">Directors Feel the Heat"), as we were heading out the door for the holidays. STT tried to bury the news in the holiday news cycle, and hoped that we were already out of pocket.

The rest I'm better off remaining mum about right now.

- Dave

[Laurab]

24. There you are - the Robin to Ides of Mystery's Batman

I loved this line "Smith and, by extension, Jorstad, tormented State Street for years."

I once tormented a former employer, and was quite proud of my work, since they'd been unfair to me, and MANY others. They thought someone was helping me, but I did it all on my own, forcing the director to resign far earlier than he'd planned, and the woman who caused me to quit to no longer have any power over any of the employees. It was a GREAT feeling! "Little people" CAN make a difference.

[CorpGovActivist]

26. Personally...

... I liked the "chewing glass" line.

: )

I'm proudest of the work we've done to force changes in non-discrimination employment practices there: women, minorities, LGBT.

As for Ides: he's had a rough (but rewarding) year, and is recuperating. He's been holed up lately (which usually means that he's recharging, and that I should be worried).

- Dave

[Rockholm]

37. Morning Kick. This is important to know.

[CorpGovActivist]

38. Careful

You're in Red Sox Nation. State Street might have your season tickets revoked.

; )

- Dave <-------------Yankees fan who wore his ballcap into Southie and lived to tell the tale

[Rockholm]

49. My tickets are quite secure.

And being the gracious person that I am, I will even allow your allegiance to the Yankees to not be a bad thing. I even capitalized Yankees, as a sign of respect.

[CorpGovActivist]

51. 1918 Was a Very Good Year...

... and I have a healthy respect for (most) Sox fans.

:toast:

- Dave

[Rockholm]

52. The feeling is mutual!

:hi:

[CorpGovActivist]

53. The Only Times I Went to Fenway...

1. When the Yankees were in town.

2. On my way to http://www.google.com/search?hl=en&q=boston+lansdowne+street">Lansdowne Street "establishments."

:toast:

- Dave

[Rockholm]

56. Fenway has changed a good bit, for the better.

Landsdowne Street has as well. Not as fun as it used to be.
By the way, as previous thread we were talking on got locked. You had commented on a statement I had made "Give a man a fish and he eats, Teach a man to fish and he starves. Yes, I do live in Gloucester. Wonderful city!

[CorpGovActivist]

58. I Like MA More...

... the further I get from Boston!

My partner has lots of family up in MA and RI. We get up there all the time, and I still see a lot of my college friends who never achieved "escape velocity" to break out of Boston's orbit.

:rofl:

GREAT food up there. Or they-uh.

; )

- Dave

P.S. Gloucester and Worcester - took me for-friggin'-ever to find them on a map. Ya'll talk funny.

[DemReadingDU]

65. morning kick