Whose bad news is Cyprus burying?

JPMorgan, SAC Capital, HSBC breathe a sigh of relief.

As CNBC's John Carney points out, it's a great time to bury bad news.  While everyone looks at Cyprus, JPMorgan Chase's story has been dropped by most publications - which is a good thing for them, as their panel hearing on Friday did not go well...

So here it is in brief, via extracts from the New York Times report, during which CEO Douglas Braunstein is berated "for nearly an hour":

For nearly an hour, the executive, Douglas L. Braunstein, was berated for playing down JPMorgan’s risky bets to investors and regulators on a conference call in April, just weeks before the bank disclosed the costly blowup.

“You give this very glowing call,” said Senator Carl Levin, Democrat of Michigan, “instead of telling them what you knew” — that the portfolio “had been losing money and violating risk limits.”

Mr. Braunstein defended his statements in the conference call, saying they were the most “accurate” depiction based on the information at the time.

“You thought that was a balanced presentation?” Mr. Levin asked incredulously, peering over his glasses.

..and during which Ina Drew, the former head of JPMorgan’s chief investment office (which was at the centre of the scandal), also comes under some aggressive over-the-glasses peering:

While Ms. Drew acknowledged that “things went terribly wrong,” she directed virtually all of the blame at lower-level traders in London and other subordinates. She returned to this defense throughout the hearing, deflecting culpability by faulting inaccurate information.

..eventually all this the blame-shifting starts prompting sarky comments from John McCain, the chief Republican on the panel:

“The traders seemed to have more responsibility and authority than the higher-up executives,” he said.

..and even Michael Cavanagh, co-head of the corporate and investment bank, which was more removed from the scandal, is questioned closely and sarcastically:

But Mr. Levin persisted, asking, “How do you possibly justify your process?” Was it a “coincidence,” he asked, that the models shifted just as losses on the trades were ballooning? At one point, he reminded Mr. Cavanagh that he was under oath.

The other pieces of submerged bad news are a money laundering fine for HSBC, and a record insider trading fine for SAC Capital - of $6000m, announced on Friday. This is huge (c.f. the second largest SEC insider trading sanction was $156 m, paid by Galleon Group founder Raj Rajaratnam back in May 2011).

"These settlements call for the imposition of historic penalties," SEC's George Canellos said during a press conference call on Friday.

 

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A new German law wants to force mothers to reveal their child’s biological father

The so-called “milkmen’s kids law” would seek protection for men who feel they have been duped into raising children they believe are not biologically theirs – at the expense of women’s rights.

The German press call them “Kuckuckskinder”, which translates literally as “cuckoo children” – parasite offspring being raised by an unsuspecting innocent, alien creatures growing fat at the expense of the host species’ own kind. The British press have opted for the more Benny Hill-esque “milkmen’s kids”, prompting images of bored Seventies housewives answering the door in negligées before inviting Robin Asquith lookalikes up to their suburban boudoirs. Nine months later their henpecked husbands are presented with bawling brats and the poor sods remain none the wiser.

Neither image is particularly flattering to the children involved, but then who cares about them? This is a story about men, women and the redressing of a legal – or is it biological? – injustice. The children are incidental.

This week German Justice Minister Heiko Maas introduced a proposal aimed at to providing greater legal protection for “Scheinväter” – men who are duped into raising children whom they falsely believe to be biologically theirs. This is in response to a 2015 case in which Germany’s highest court ruled that a woman who had told her ex-husband that her child may have been conceived with another man could not be compelled to name the latter. This would, the court decided, be an infringement of the woman’s right to privacy. Nonetheless, the decision was seen to highlight the need for further legislation to clarify and strengthen the position of the Scheinvater.

Maas’ proposal, announced on Monday, examines the problem carefully and sensitively before merrily throwing a woman’s right to privacy out of the window. It would compel a woman to name every man she had sexual intercourse with during the time when her child may have been conceived. She would only have the right to remain silent in cases should there be serious reasons for her not to name the biological father (it would be for the court to decide whether a woman’s reasons were serious enough). It is not yet clear what form of punishment a woman would face were she not to name names (I’m thinking a scarlet letter would be in keeping with the classy, retro “man who was present at the moment of conception” wording). In cases where it did transpire that another man was a child’s biological father, he would be obliged to pay compensation to the man “duped” into supporting the child for up to two years.

It is not clear what happens thereafter. Perhaps the two men shake hands, pat each other on the back, maybe even share a beer or two. It is, after all, a kind of gentlemen’s agreement, a transaction which takes place over the heads of both mother and child once the latter’s paternity has been established. The “true” father compensates the “false” one for having maintained his property in his absence. In some cases there may be bitterness and resentment but perhaps in others one will witness a kind of honourable partnership. You can’t trust women, but DNA tests, money and your fellow man won’t let you down.

Even if it achieves nothing else, this proposal brings us right back to the heart of what patriarchy is all about: paternity and ownership. In April this year a German court ruled that men cannot be forced to take paternity tests by children who suspect them of being their fathers. It has to be their decision. Women, meanwhile, can only access abortion on demand in the first trimester of pregnancy, and even then counselling is mandatory (thereafter the approval of two doctors is required, similar to in the UK). One class of people can be forced to gestate and give birth; another can’t even be forced to take a DNA test. One class of people can be compelled to name any man whose sperm may have ventured beyond their cervix; another is allowed to have a body whose business is entirely its own. And yes, one can argue that forcing men to pay money for the raising of children evens up the score. Men have always argued that, but they’re wrong.

Individual men (sometimes) pay for the raising of individual children because the system we call patriarchy has chosen to make fatherhood about individual ownership. Women have little choice but to go along with this as long as men exploit our labour, restrict our access to material resources and threaten us with violence. We live in a world in which it is almost universally assumed that women “owe” individual men the reassurance that it was their precious sperm that impregnated us, lest we put ourselves and our offspring at risk of poverty and isolation. Rarely do any of us dare to protest. We pretend it is a fair deal, even that reproductive differences barely affect our lives at all. But the sex binary – the fact that sperm is not egg and egg is not sperm – affects all of us.

The original 2015 ruling got it right. The male demand for reassurance regarding paternity is an infringement of a woman’s right to privacy. Moreover, it is important to see this in the context of all the other ways in which men have sought to limit women’s sexual activity, freedom of movement and financial independence in order to ensure that children are truly “theirs”.  Anxiety over paternity is fundamentally linked to anxiety over female sexuality and women’s access to public space. Yet unless all women are kept under lock and key at all times, men will never, ever have the reassurance they crave. Even then, the abstract knowledge that you are the only person to have had the opportunity to impregnate a particular woman cannot rival the physical knowledge of gestation.

We have had millennia of pandering to men’s existential anxieties and treating all matters related to human reproduction, from sex to childbirth, as exceptional cases meaning women cannot have full human rights. Isn’t it about time we tried something new? How about understanding fatherhood not as winning gold in an Olympic sperm race, but as a contract endlessly renewed?

What each of us receives when a child is born is not a biological entity to do with as we choose. It is a relationship, with all of its complexities and risks. It is something worth contributing to and fighting for. Truly, if a man cannot understand that, then any money wasted on a Kuckuckskind – a living, breathing child he could get to know – has got to be the least of his worries. 

Glosswitch is a feminist mother of three who works in publishing.