Good morning. I'm Kaja Whitehouse and I'm filling in for Aaron Weinman. The mood on Wall Street, and financial hubs across the globe, is somber this morning following the death of former Japanese prime minister Shinzo Abe, who was shot while giving a speech at a campaign event in Nara, western Japan.
In today's newsletter, we are also looking at a story from Chicago, where three JPMorgan traders are standing trial over an alleged scheme to manipulate gold and other precious metal prices.
We will explore why that trial is relevant to today's Wall Street (even though it dates back to 2019) — and introduce readers to the 10 members of Congress who really dislike the financial industry's hottest new trend: ESG investing.
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1. It's all about the messages. At the heart of the government's metals rigging case against three former JPMorgan traders will be a slew of internal bank chat logs that the prosecution will use as evidence. According to Bloomberg, JPMorgan has been fighting to keep some internal communications out of the trial, including messages involving current executives.
For Wall Street bankers and traders, it's just the latest reminder that what they say to colleagues and clients is never private. Bankers who take to unauthorized apps like WhatsApp to conduct business stand to lose their jobs, even if no inappropriate messages were found.
It's part of a larger government crackdown that has rattled financial industry pros whose clients often prefer WhatsApp and SMS to email. It's also putting some employees at odds with their employers as banks, JPMorgan, do whatever it takes to keep tabs on their workers.
As Insider has previously reported, Wall Street's monitoring has some employees spooked. But banks appear to be doubling down nonetheless.
In other news:
2. ESG's newest enemy works for Congress. Funds that invest with environmental, social, and governance considerations in mind are coming under attack from a group of Republican lawmakers, one of whom called ESG investing "a scam." Insider's Rebecca Ungarino breaks down who they are and what they want.
3. Elon Musk's deal to buy Twitter in 'peril'. Advisors to the Tesla CEO have concluded that Twitter's figures on spam accounts are unverifiable, the Washington Post reported. Meanwhile, the billionaire has stopped engaging in certain discussions around funding for the $44 billion deal, including with a likely backer, WaPo said, citing anonymous sources.
4. There's a new financial advisor toolkit. Wealth-management firms are poised to reevaluate the financial software they use to help clients manage money in the face of tumbling stocks. Insider spoke to seven industry insiders about the fintechs that will be deemed essential — and the ones that could be tossed.
5. Bank of America's refugee-turned-banker to the ultra rich. Dega Nalayeh shares how she went from nothing to a $6.4 billion book of business that includes players for the Atlanta Hawks basketball team. Read her story here.
6. SoftBank veteran Rajeev Misra is setting up his own fund. Misra is stepping back from his role overseeing SoftBank's latest megasized investment vehicle, Vision Fund 2. He'll still head up softBank's first Vision Fund, while launching own $6 billion fund. More details here.
7. Should you change jobs right now? The stock market is down, inflation is at a 40-year high, and experts are bracing for a recession — so your window may be closing. Here's how to decide what to do.
8. The battle over Spirit Airlines. Shareholders of Spirit Airlines are scheduled to vote today, July 8, on the company's proposed merger with Frontier Airlines. But will it happen? The company has already postponed the vote twice to explore overtures from rival suitor JetBlue.
9. Another contentious hedge fund divorce. John Paulson was accused by his wife, Jenica, of secretly stashing billions of assets into secret trusts to avoid having to share his wealth with her as part of their divorce, Bloomberg reported.
10. Our "Banker of the Week" feature is on vacation — it'll be returning next week. But in the meantime, get to know the last four bankers we featured:
- Naveen Nataraj, senior managing director at Evercore, held nine big-ticket transactions in 2021 that amassed almost $60 billion in enterprise value.
- Uzair Dossani, a managing director at Intermediate Capital Group, is a 25-year private-equity veteran who recently closed a deal for Seaway Plastics Engineering.
- Harold Butler, a huge advocate for greater equity on Wall Street, leads Citi's diverse financial institutions group.
- Pete Stavros, the co-head of US private equity for KKR, just closed the sale of C.H.I Overhead Doors to Nuco.
If you know of any bankers who recently closed big deals or are making strides on Wall Street, submit them as potential "Bankers of the Week" to Aaron at [email protected]
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