The Daily Telegraph reports that Wall Street banks have just seven days to settle with state and federal regulators and agree to pay fines of several hundred million dollars. Unless they do so, New York state Attorney General Eliot Spitzer and other state regulators could lose patience and start talking and acting very tough.
Regulators are anxious to reach agreement on the so-called 'global settlement' which will put an end to federal and state probes into Wall Street stock research practices.
Final meetings are due to take place this week, but key issues are thought to remain unresolved. The banks wish to get away with paying up but without having to admit wrongdoing as they fear that to do so will encourage further investor lawsuits and leave them vulnerable to claims totalling billions of dollars. Regulators also wish to preserve the right to pursue individual bankers and charge them with criminal behaviour.
The Telegraph quotes one banker, 'close to the talks', who called the negotiations 'legalised extortion. It's pay up, or we will continue to investigate'.