JPMorgan, RBS Sued by Federal Agency Over Mortgage Bonds

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JPMorgan, RBS Sued by Federal Agency Over Mortgage Bonds

June 20, 2011, 4:32 PM EDT

By Steven Church


(Updates with plan for more lawsuits in fifth paragraph.)
June 20 (Bloomberg) -- JPMorgan Chase & Co. and Royal Bank of Scotland Group Plc units were sued by the federal agency that regulates credit unions, seeking to recover money lost on mortgage-backed securities.


The National Credit Union Administration Board, or NCUA, accused the institutions of packaging and selling mortgage bonds with loans that didn’t meet underwriting guidelines. The bonds, sold to federally chartered credit unions, caused more than $800 million in losses, according to the agency.


A material percentage amount of the loans included in the bonds “were all but certain to become delinquent or default shortly after origination,” the regulator said in two complaints filed in federal court in Kansas City, Kansas. It didn’t specify the amount of money sought.


Five so-called wholesale credit unions failed because they purchased mortgage-backed securities that lost about $50 billion, David Small, an NCUA spokesman, said in an interview. After repackaging about $28 billion worth of the bonds and selling $10 billion worth, the final loss to the entire federal credit union system will be between $7 billion and $9 billion, Small said.


The agency plans to sue between five and 10 additional banks related to the mortgage bonds, Small said. Agency officials are in settlement talks with the banks, he said.


Untrue Statements


JPMorgan sold credit unions almost $213 million of mortgage bonds using sale documents that contained untrue statements or lacked important information, according to one complaint. RBS used documents with the same flaws to sell credit unions about $138 million of bonds, the NCUA said in the other complaint.


The NCUA wants the banks to help cover losses caused by the failures of the credit unions, including U.S. Central Federal Credit Union, which was placed into conservatorship in 2009. The agency is liquidating the wholesale credit unions. Wholesale credit unions provide services to retail credit unions, which serve consumers.


The prospectuses for the bond sales contained “untrue statements of material fact or omitted material facts,” in violation of U.S. securities laws, according to the NCUA.


Michael Geller, a spokesman for Edinburgh-based RBS, and Jennifer Zuccarelli, a spokeswoman for New York-based JPMorgan, didn’t immediately return calls for comment today.


The cases are National Credit Union Administration Board v. J.P. Morgan Securities LLC, 11-cv-02341, and National Credit Union Administration Board v. RBS Securities Inc., 11-cv-02340, U.S. District Court, District Of Kansas (Kansas City).

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http://www.businessweek.com/news/201...age-bonds.html

they'll "settle" for nothing, lawyers win

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Originally Posted by boutons_deux

they'll "settle" for nothing, lawyers win

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They've been sued by a federal agency, not an individual whose attorneys are taking a percentage of some financial recovery. Whatever an ultimate settlement might be, its benefits run to the government.

I'm not sure how the lawyers will win in this instance.

get back to me when F&F cram back down to the lenders all the shit fraudulent mortgages they were sold.

Sure. It adds up over time.

Somehow I doubt the settlement will mean much to the banks they are suing.

Sometime I just wish, that just once, some bank would get bitch slapped so hard that the rest of them would think twice about peddling dishonest bullshit.

"I'm not sure how the lawyers will win in this instance."

the Wall st lawyers will win somehow. Do they ever lose? If they "settle" for some trivial sum vs the possible maximum, I assume they will get "contingency" bonuses.

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Originally Posted by RandomGuy

Somehow I doubt the settlement will mean much to the banks they are suing.

Sometime I just wish, that just once, some bank would get bitch slapped so hard that the rest of them would think twice about peddling dishonest bullshit.

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If we didn't have politicians bailing them out with our money, that might happen.

http://www.bloomberg.com/news/2011-0...than-weil.html

"If we didn't have politicians bailing them out with our money"

Wall Streeters, current/past/future, decided/extorted the bailout. Place the guilt and crime where it belongs. Wall St does the corrupting, not Congress.

slap that wrist...

Here's another one

Pension Fund Scandal Shows That Corruption Still Pays Well in New York

Forthcoming sentences to be imposed in New York on people involved in corruptly obtaining investment funds from the New York State Pension Fund will demonstrate what costs, if any, will be imposed on corrupters, rather than the public servants they corrupted.

Whether New York is serious about the battle against corruption involving the rich and powerful is very much a question. Evidence will be found in whether Hevesi's principal partners in crime serve real time, or get off with a slap on the wrist that allows them to go on with their lives as if they done nothing very seriously wrong. A man who stole $50,000 would face up to fifteen years in prison.

It is not clear to me that a man who pays bribes of $800,000 or more to obtain $250,000,000 should go free.

http://www.huffingtonpost.com/john-w...tml?view=print

Bank Of America Nears $8.5B Settlement On Mortgage-Securities Claims

Bank of America Corp is close to a deal to pay $8.5 billion to settle claims from investors that lost money on mortgage-backed securities,

http://www.huffingtonpost.com/2011/0...tml?view=print

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The capitalists get paid off, while BoA continues to steal houses and mortgage payments from people for houses BoA, aided by the corrupt courts, can't show title and/or just by making errors.

Yves Smith with deeper article

Bank of America Likely to Settle Case with NY Fed, Pimco, BlackRock for $8.5 Billion

While most threatened litigation is settled out of court, this case in theory had to overcome procedural hurdles for any suit to be filed, and no group of investors had ever surmounted this impediment. Chris Whalen similarly noted that BofA could simply tell the investors to “pound sand.” However, we had noted that if it moved forward, that this type of case, a representation and warranties case, is always settled because they are too expensive to fight in court.

And representation and warranties cases of this type (which would demand that the servicer make the originator buy back dud loans) requires that the investors not merely prove that the seller lied, but that the lies were THE reason that the losses on specific mortgages took place (as opposed to normal “shit happens” loan losses, meaning due to unemployment or other loss of income, death, and disability). That means even if the judge approves the use of a sample that each side still will argue on the individual cases within that sample. Think how many loans that would involve across what as of the last sighting was reported to be 115 deals. Because these case are so costly to pursue, settlements historically have been 10% to 15% of the value of the loans alleged to have been misrepresented.

http://www.nakedcapitalism.com/2011/...+capitalism%29

$8.5 billion is a hell of a settlement.

There were $100Bs involved.

You minimize.

Guess How Much More Wall St. Spends on Bonuses Than on Penalties for Torpedoing the Economy?

JPM Chase, at the height of the federal bank subsidization program, got nearly $100 BILLION dollars worth of -- help.

Leaving aside the tepid characterization implied by the term "misconduct" instead of say, "racketeering," these fines don't, and won't, change the banking landscape. They won’t halt the manufacturing of potentially toxic securities crafter from the droppings on the dirty floor of banks’ books. They don’t stop banks from legally taking multiple sides of any trade in the name of "market making."

The SEC seems fine with that. The SEC was founded in conjunction with the Glass-Steagall Act that separated banks that dealt with the public's deposit and financing needs, from those that created and traded speculative securities for profit. It would be prudent to suggest a modern equivalent of that act. It might help the SEC do its job of protecting the public before devastation, or at the very least, untangle the web of fraud and debt at the core of these complex giants.

Put that in perspective with the $28 billion in bonuses that JPM Chase scooped up for just 2010, or the $424 billion in total bonuses the top six banks bagged between the crisis book-end years of 2007-2009, or the $128 billion of bonuses Wall Street got last year. Now, consider that not only is the penalty amount a pittance, but the impact of these fines is even smaller.

http://www.alternet.org/module/printversion/151434

Bank of America announced plans on Wednesday to set aside $14 billion to pay investors who bought securities it assembled from mortgages that later soured, an agreement that the company expected would lead to a second-quarter loss of $8.6 billion to $9.1 billion.

http://www.nytimes.com/2011/06/30/bu...gewanted=print

Now, if the financial sector set aside $1T+ to buy back the toxic shit they sold the Treasury, and bad mortagges they sold to Fannie and Freddie ....

That cost got socialized. We set aside $750B to buy even more of that toxic shit.

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Originally Posted by boutons_deux

Guess How Much More Wall St. Spends on Bonuses Than on Penalties for Torpedoing the Economy?

JPM Chase, at the height of the federal bank subsidization program, got nearly $100 BILLION dollars worth of -- help.

Leaving aside the tepid characterization implied by the term "misconduct" instead of say, "racketeering," these fines don't, and won't, change the banking landscape. They won’t halt the manufacturing of potentially toxic securities crafter from the droppings on the dirty floor of banks’ books. They don’t stop banks from legally taking multiple sides of any trade in the name of "market making."

The SEC seems fine with that. The SEC was founded in conjunction with the Glass-Steagall Act that separated banks that dealt with the public's deposit and financing needs, from those that created and traded speculative securities for profit. It would be prudent to suggest a modern equivalent of that act. It might help the SEC do its job of protecting the public before devastation, or at the very least, untangle the web of fraud and debt at the core of these complex giants.

Put that in perspective with the $28 billion in bonuses that JPM Chase scooped up for just 2010, or the $424 billion in total bonuses the top six banks bagged between the crisis book-end years of 2007-2009, or the $128 billion of bonuses Wall Street got last year. Now, consider that not only is the penalty amount a pittance, but the impact of these fines is even smaller.

http://www.alternet.org/module/printversion/151434

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Make all the executives give back their bonuses as penalty.

That might get their attention. :pimpslap

Ah, one can fantasize.

Clawback? Anti-business!

Why did Bank of America escape prosecution

Charles R. Morris, a former banker and the author of "The Trillion Dollar Meltdown," told Salon on Wednesday that while it is clear that BofA behaved with "no shame," there are numerous reasons why the feds left the bank alone.

For instance, unlike in a case of insider trading, when the guilty party is caught red-handed on the phone, "it's really hard to make these criminal cases stick and if you really want to get the top guy, it will take forever," Morris said.

"You don't have a clean smoking gun," he explained. "It seems to me that Goldman Sachs was pretty much the only competent bank, in that when they took a view, they really took it and managed it up and down the institution." But proving "intent" at the top can be problematic.

Even with a case like Bear Stearns -- where there seems to be ample grounds for a criminal case (email trails that have come up in lawsuits that have reached discovery and Senate investigations show clear instances of fraud) -- criminal charges might not stick, Morris noted.

The desire of the federal government to follow up with criminal charges is relevant, too. When it came to bringing charges against Enron's Jeff Skilling and Ken Lay, the FBI worked very hard indeed, but "they haven't done that here," Morris said. "The federal government was confused over whether they wanted to save or punish the banks. They've decided to save them."

"The settlement is actually pretty modest considering the losses involved," he said. "The Wall Street Journal said the investors held securities originally valued over $100 billion, which I think is a bit steep. But on the Wall Street Journal figures, if they're settling for 8.5 percent of what the investment was originally worth, it's pretty modest."

http://www.salon.com/news/politics/w...iew/index.html

Yves Smith:

BofA “Settlement”: Not a Done Deal, and Not a Good Deal for Investors

http://www.nakedcapitalism.com/2011/...+capitalism%29

Lender proves to be a costly buy for Bank of America

Countrywide Financial Corp. turns out to be a huge miscalculation as red ink keeps flowing. The bank added $20.4 billion this week in expected costs to the tally.

E. Scott Reckard, Los Angeles Times

June 30, 2011

When Bank of America Corp. acquired mortgage giant Countrywide Financial Corp. three years ago this week, cementing BofA's position as a consumer banking leader, the purchase price was a measly $2.5 billion in stock.

But the real cost could easily be 10 to 15 times that amount after the home lender incurred huge losses under BofA's ownership and the bank agreed to pay billions of dollars to settle litigation over bad loans made by Countrywide during the housing boom. On Wednesday alone, the bank added $20.4 billion in expected costs to the tally.

The mounting numbers have made the acquisition of Countrywide one of the most misguided takeovers in the history of banking, analysts say.

"The worst by a mile," FBR Capital Markets analyst Paul Miller said — or at least the worst since he began following the industry in 1992.

When the Charlotte, N.C., bank agreed in January 2008 to buy Countrywide, the nationwide mortgage meltdown was well underway in the wake of surging defaults on subprime and other high-risk loans written by the Calabasas company and other lenders.

Shortly after the takeover was completed the following July 1, Kenneth Lewis, BofA's chief executive at the time, acknowledged that Countrywide's losses were running at the high end of what his staff had projected.

But because accountants had aggressively written down the value of Countrywide's assets before transferring them to BofA's books, Lewis predicted the combined home-loan business, consisting mostly of Countrywide's operations, would immediately show a profit — and could see huge earnings growth once the mortgage industry recovered.

Instead, the unit has bled about $16 billion in red ink since the Countrywide takeover — with no real industry recovery in sight.

The $20.4 billion in bad news disclosed Wednesday includes $8.5 billion in payouts to 22 institutional investors to settle demands that Bank of America repurchase bonds backed by Countrywide mortgages. An additional $5.5 billion is to beef up reserves for similar demands by other investors.

The bank also said it would record $6.4 billion in additional mortgage-related charges for the second quarter. That amount includes a $2.6-billion write-off of its Countrywide investment and expenses for revising its mortgage-servicing operations to comply with orders from the Federal Reserve and the Office of the Comptroller of the Currency, which regulates national banks.

The Fed and the comptroller's office were acting in response to revelations that Bank of America and other large mortgage servicers had cut corners in their handling of troubled borrowers, including "robo-signing" documents supporting foreclosures without having the signers actually verify the information.

A coalition of state attorneys general and federal officials are negotiating a separate, broader settlement of the foreclosure fiasco with Bank of America and four other big banks that are major mortgage servicers.

Those authorities, who began their investigation in October, met with the servicers last week but were unable to reach an agreement with the banks on the penalty they must pay, a spokesman for Iowa's attorney general said. Estimates of the total to be paid by the five banks have ranged from $5 billion to $20 billion.

BofA said the newly announced costs meant it would report a net loss of $8.6 billion to $9.1 billion for the second quarter, instead of a profit of $3.2 billion to $3.7 billion. Wall Street seemed to breathe a sigh of relief that things weren't even worse. Bank of America shares ended the day up 32 cents, or 3%, at $11.14.

The new Countrywide-related costs are in addition to these previously announced items, some of which contributed to the operating losses at BofA's mortgage unit since the takeover:

A 2008 settlement with California to cut payments by as much as $8.6 billion on mortgages that state officials said were abusive.

A 2010 accord to forgive as much as $3 billion in principal for severely delinquent Countrywide borrowers in Massachusetts who owed more on their mortgages than their homes were worth.

An agreement last year to pay $600 million to former Countrywide shareholders to settle a securities-fraud lawsuit.

An agreement in April to pay $1.1billion to mortgage insurer Assured Guaranty Ltd. related to losses on Countrywide loans.

More than $6 billion in payments to government-controlled loan buyers Fannie Mae and Freddie Mac to settle demands for buybacks of flawed home loans.

Bank of America can take some consolation, however small, in the fact that it paid for Countrywide entirely with BofA stock.

When it agreed to the deal in January 2008, those shares were valued by the stock market at $4 billion. When the transaction closed, their value had fallen to $2.5 billion as the global financial crisis had intensified. They are now worth about $1.2 billion.

http://www.latimes.com/business/real...26,print.story

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So it was a bad deal, a bad mgmt decision, so the board punished the mgmt with reduced bonuses? :lol

J.P. Morgan to pay $228 million for bond bid-rigging scheme

US bank JP Morgan Chase was slapped with fines and repayment penalties of $228 million for a bid-rigging scheme that shortchanged issuers of municipal bonds, US authorities announced Thursday.

In a case that has also seen Swiss bank UBS and Bank of America heavily fined, JP Morgan admitted that employees of JP Morgan Securities (JPMS) conspired to manipulate the bidding process for the right to handle the proceeds of billions of dollars in muni bond auctions between 2001 and 2006.

The payout covers penalties, restitution of $51.2 million to the affected borrowers and disgorgement of profits on the deals, according to the Department of Justice and the Securities and Exchange Commission.

In parallel agreements with state and federal authorities, the company avoided being legally prosecuted on the charges while admitting to anticompetitive conduct.

Eighteen former employees of banks and financial service firms have been hit with criminal charges in the scheme, and nine have pleaded guilty, including former JP Morgan executive James Hertz, the Justice Department said in a statement.

JP Morgan's involvement in the ring tied it to at least 93 bids which were fraudulently fixed in 31 states, according to the SEC.

http://www.rawstory.com/rs/2011/07/0...e+Raw+Story%29

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Fuckers, ripping off taxpayers for fun and profit and bonuses and stock price rises/dividends to capitalists.

Do these fines come anywhere close to nullifying the ripoffs JPM and friends pocketed?

I always assume that these cases represent only a tiny fraction of what's really going on.

But taxing these kleptocratic assholes is "stealing" --- WC

BofA to take $13 billion more in charges: Bernstein

Bank of America will take another $13 billion in charges related to pending settlement with private label mortgage-backed securities investors, Sanford C Bernstein said.

A group of public pension funds and a group of bondholders have challenged Bank of America Corp's $8.5 billion settlement with holders in soured mortgage-backed securities, which the bank expects will result in $20 billion of charges and a second-quarter loss.

The bank was hit hard by toxic home loans after BofA bought mortgage lender Countrywide Financial in 2008, just as the housing market bubble was bursting, ensuing billions of dollars in losses.

http://www.reuters.com/article/2011/...2F+Top+News%29

As Wall St. Polices Itself, Prosecutors Use Softer Approach

As the financial storm brewed in the summer of 2008 and institutions feared for their survival, a bit of good news bubbled through large banks and the law firms that defend them.

Federal prosecutors officially adopted new guidelines about charging corporations with crimes — a softer approach that, longtime white-collar lawyers and former federal prosecutors say, helps explain the dearth of criminal cases despite a raft of inquiries into the financial crisis.

Though little noticed outside legal circles, the guidelines were welcomed by firms representing banks. The Justice Department’s directive, involving a process known as deferred prosecutions, signaled “an important step away from the more aggressive prosecutorial practices seen in some cases under their predecessors,” Sullivan & Cromwell, a prominent Wall Street law firm, told clients in a memo that September.

The guidelines left open a possibility other than guilty or not guilty, giving leniency often if companies investigated and reported their own wrongdoing. In return, the government could enter into agreements to delay or cancel the prosecution if the companies promised to change their behavior.

But this approach, critics maintain, runs the risk of letting companies off too easily.

“If you do not punish crimes, there’s really no reason they won’t happen again,” said Mary Ramirez, a professor at Washburn University School of Law and a former assistant United States attorney. “I worry and so do a lot of economists that we have created no disincentives for committing fraud or white-collar crime, in particular in the financial space.”

While “deferred prosecution agreements” were used before the financial crisis, the Justice Department made them an official alternative in 2008, according to the Sullivan & Cromwell note.

It is among a number of signs, white-collar crime experts say, that the government seems to be taking a gentler approach.

http://www.nytimes.com/2011/07/08/bu...gewanted=print

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The kleptocratic plutocracy has dictated to its subsidiary, govts at all levels, to back off and let them rape and pillage at will without serious punishments, if any at all.

JP Morgan Chase Fine: Another Slap on the Wrist for Wall Street

This is one of the best examples we’ve had yet of the profound difference in the style of criminal justice enforcement for the very rich and connected, versus the style of justice for everyone else. This scam that Chase, Bank of America and UBS were involved with was no different in any way, really, from old-school mafia-style bid-rigging scams.

What these banks did is they got together and carved up territory between them, arranging things so that they wouldn’t be bidding against each other in municipal debt auctions. That means the 18 different states involved in these 93-odd deals all got screwed out of the best prices, leaving the taxpayers in those places severely overcharged for their public borrowing.

This is absolutely no different from what mafia groups in New York used to (and probably still do) do for public contracts – the proverbial five families would get together, divide up the boroughs and neighborhoods between them, and each family would individually buy or intimidate their way into the bidding process, corrupting the game so that the public had to overpay for their garbage collection or their construction labor or whatever. The only difference here is that we’re talking about debt, not garbage. But the concept is exactly the same; it’s the same crime.

If Khuzami’s defendants had been a bunch of Italians from Howard Beach, they would be facing RICO charges and would be looking at years in prison, plus seizure of all their ill-gotten gains, in addition to civil suits and penalties.

http://www.rollingstone.com/politics...708?print=true

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Chicago Trading Firm’s Lawsuit Claims Banks Conspired to Manipulate Libor

Q
By David Voreacos - Jul 7, 2011 4:33 PM CT Thu Jul 07 21:33:21 GMT 2011

A Chicago trading firm accused Bank of America Corp. (BAC), JPMorgan Chase & Co. (JPM), UBS AG (UBSN) and Citigroup Inc. (C) of conspiring to manipulate the London interbank offered rate.





The banks drove down Libor to generate billions of dollars in profits from swaps, loans, interest rate derivatives and other financial instruments whose value depended on the rate, Eldorado Trading Group LLC said in a complaint filed July 5 in federal court in Newark, New Jersey.



The civil lawsuit is one of several filed in response to probes by the U.S. Justice Department, Securities and Exchange Commission and Commodity Futures Trading Commission related to whether there were improper attempts to manipulate Libor. The rate, at which banks borrow from one another in the London interbank market, is a short-term, international benchmark.



The banks “had a substantial incentive to manipulate, and in fact did manipulate, Libor downward, in order to increase the income from its interest rate derivatives and similar instruments,” according to Eldorado’s complaint. “This manipulation resulted in billions of dollars in revenue.”



Eldorado owned futures and options contracts based on Eurodollar deposits traded on the Chicago Mercantile Exchange from August 2007 to December 2009, according to the complaint. It seeks to represent similar owners of contracts traded on the Chicago exchange.



U.S. Probes



Karina Byrne, a UBS spokeswoman, said the Zurich-based bank is cooperating with the U.S. probes, and has also gotten requests for information from the Japan Financial Services Agency and the U.K. Financial Services Authority.
“We believe this suit is without merit,” Danielle Romero- Apsilos, a spokeswoman for New York-based Citigroup, said in an e-mail.



Lawrence Grayson, a spokesman for Charlotte, North Carolina-based Bank of America, declined to comment. Jennifer Zuccarelli, a spokeswoman for New York-based JPMorgan, declined to comment.



The case is Eldorado Trading Group LLC v. Bank of America Corp., 11-cv-3847, U.S. District Court, District of New Jersey (Newark).

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Let's not tax the wealthy just because they work so hard and are so honest. They deserve every penny they steal.

hehe

Florida Foreclosure Fraud Investigators Allege Attorney General Fired Them For Aggressively Pursuing Banks

http://thinkprogress.org/wp-content/...ffraud0713.jpg

Former Assistant Attorney General Theresa Edwards and colleague June Clarkson had been investigating the state’s so-called “foreclosure mills,” uncovering evidence of legal malpractice that also implicated banks and loan servLuck_The_Fakers_icers. Despite positive performance evaluations, Edwards said the two were told during a meeting with their supervisor in late May to give up their jobs voluntarily or be let go. Edwards said no reason was given for the move.

“It all happened very abruptly,” said Edwards, who had worked in the attorney general’s office for about three years. The foreclosure investigations were launched under former Attorney General Bill McCollum, but Edwards said she sensed changes were coming under Gov. Rick Scott and Attorney General Pam Bondi. “I think they wanted to put people in there that were more in line with their thinking,” Edwards said.

According to data collected from the National Institute On Money In State Politics, Bondi received $57,500 from the securities and investment industries and $150,925 from the real estate industry during her last election campaign.

http://thinkprogress.org/economy/201...ursuing-banks/

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the financial/realestate sectors own the pretty bitch

California AG Considering Joining New York, Delaware in Broad Probe of Mortgage Abuses

We’d said the 50 state attorneys general settlement was wobblier than the press cheerleading would lead you to believe. We’ve also said the California AG, Kamala Harris, was likely to be among the defectors. The odds of that increased today as she met with New York AG Eric Schneiderman to discuss joining the probe that he and Delaware AG Beau Biden have launched, which is the most extensive investigation undertaken to date.

It isn’t hard to see why the settlement talks are fracturing. Many AGs are unhappy with Tom Miller’s failure to keep them in the loop, the lack of meaningful investigations, and the high odds that the banks will get a broad waiver, which is tantamount to a big “get out of liability free card”. If you have any doubts whose interests are served by these negotiations, Jamie Dimon, in an investor conference call Wednesday, said he “would do anything to get it done today.” And no wonder why. He also said, per Bloomberg:

There have been so many flaws in mortgages that it’s been an unmitigated disaster…We just really need to clean it up for the sake of everybody. And everybody is going to sue everybody else, and it’s going to go on for a long time.

Given that California was one of the states worst hit by the mortgage meltdown, its abstention from a settlement deal would have a disproportionate impact. Politically, the fact that the states that have exited and appear likely to exit have Democratic AGs is also more of a blow to the Administration, which has been involved in the negotiations that Republican defections would be.

From the Los Angeles Times (hat tip Lisa Epstein):

California Atty. Gen. Kamala Harris met with New York Atty. Gen. Eric Schneiderman on Thursday in San Francisco to discuss cooperating on the investigation, which is already one of the broadest to probe how banks encouraged the financial crisis through the creation of risky financial instruments backed by mortgages.

New York and Delaware have more than a dozen attorneys working full time on the effort and have subpoenaed or requested information from 13 financial firms, including Goldman Sachs and JPMorgan Chase & Co., according to people familiar with the investigation. The people spoke on condition of anonymity because of the sensitivity of the investigation…

Biden and Schneiderman have separate but parallel investigations into the matter and have signed an agreement to share information, people familiar with the cases said.

We’d said the 50 state attorneys general settlement was wobblier than the press cheerleading would lead you to believe. We’ve also said the California AG, Kamala Harris, was likely to be among the defectors. The odds of that increased today as she met with New York AG Eric Schneiderman to discuss joining the probe that he and Delaware AG Beau Biden have launched, which is the most extensive investigation undertaken to date.

It isn’t hard to see why the settlement talks are fracturing. Many AGs are unhappy with Tom Miller’s failure to keep them in the loop, the lack of meaningful investigations, and the high odds that the banks will get a broad waiver, which is tantamount to a big “get out of liability free card”. If you have any doubts whose interests are served by these negotiations, Jamie Dimon, in an investor conference call Wednesday, said he “would do anything to get it done today.” And no wonder why. He also said, per Bloomberg:

There have been so many flaws in mortgages that it’s been an unmitigated disaster…We just really need to clean it up for the sake of everybody. And everybody is going to sue everybody else, and it’s going to go on for a long time.

Given that California was one of the states worst hit by the mortgage meltdown, its abstention from a settlement deal would have a disproportionate impact. Politically, the fact that the states that have exited and appear likely to exit have Democratic AGs is also more of a blow to the Administration, which has been involved in the negotiations that Republican defections would be.

From the Los Angeles Times (hat tip Lisa Epstein):

California Atty. Gen. Kamala Harris met with New York Atty. Gen. Eric Schneiderman on Thursday in San Francisco to discuss cooperating on the investigation, which is already one of the broadest to probe how banks encouraged the financial crisis through the creation of risky financial instruments backed by mortgages.

New York and Delaware have more than a dozen attorneys working full time on the effort and have subpoenaed or requested information from 13 financial firms, including Goldman Sachs and JPMorgan Chase & Co., according to people familiar with the investigation. The people spoke on condition of anonymity because of the sensitivity of the investigation…

Biden and Schneiderman have separate but parallel investigations into the matter and have signed an agreement to share information, people familiar with the cases said.

http://www.nakedcapitalism.com/2011/...ge-abuses.html

Quelle Surprise! The Banks Lied and Robosigning Lives!

14 major servicers then swore in consent orders earlier this year that they’d stop doing all that bad stuff. But with compliance weak (the banks get to hire the overseers!), they appear to have decided they don’t need to change their ways all that much. Indeed, the record of consent orders is underwhelming; for instance, both Nevada and Arizona are suing Countrywide for violations of past agreements.

Two stories were published yesterday, one a long form Reuters investigation (hat tip April Charney), the other a shorter report by AP (hat tip Lisa Epstein and Daniel Pennell). First from Reuters:

Reuters has found that some of the biggest U.S. banks and other “loan servicers” continue to file questionable foreclosure documents with courts and county clerks. They are using tactics that late last year triggered an outcry, multiple investigations and temporary moratoriums on foreclosures.

In recent months, servicers have filed thousands of documents that appear to have been fabricated or improperly altered, or have sworn to false facts.

Reuters also identified at least six “robosigners,” individuals who in recent months have each signed thousands of mortgage assignments — legal documents which pinpoint ownership of a property. These same individuals have been identified — in depositions, court testimony or court rulings — as previously having signed vast numbers of foreclosure documents that they never read or checked.

So…the banks have perjured themselves, made commitment to regulators that they are brazenly violating. The Reuters investigation determined that at least 5 of the 14 servicers that signed consent decrees in April are not complying with their requirements: OneWest, Bank of America, HSBC, Bank USA, Wells Fargo and GMAC Mortgage. Note that three of them (Bank of America, Wells, and GMAC, now Ally) are among the five biggest servicers, so the impact is greater than the number of derelicts suggests. And one is the annoyingly pious Wells, which keeps maintaining, contrary to all evidence, that it is better than the other servicers. In addition, another six servicers that did not sign the consent orders were also found by the Reuters exam to have engaged in abusive practices.

The AP report found that servicers were continuing to generate documents signed by well-known robosigners, including the notorious Lisa Greene. This seems to be asking to be caught out.

http://www.nakedcapitalism.com/2011/...+capitalism%29

Mortgage 'Robo-Signing' Goes On

Mortgage industry employees are still signing documents they haven't read and using fake signatures more than eight months after big banks and mortgage companies promised to stop the illegal practices that led to a nationwide halt of home foreclosures.

County officials in at least three states say they have received thousands of mortgage documents with questionable signatures since last fall, suggesting that the practices, known collectively as "robo-signing," remain widespread in the industry.

The documents have come from several companies that process mortgage paperwork, and have been filed on behalf of several major banks. One name, "Linda Green," was signed almost two dozen different ways.

Lenders say they are working with regulators to fix the problem but cannot explain why it has persisted. :lol :lol :lol :lol

http://finance.yahoo.com/news/AP-Exc...239330433.html

=======

It has "persisted" because all y'all fucking criminal bankers are raping due process of property law, the fundamental law of society, "because you can", and no govt has the interest or policing power to tackle such a huge, widespread crime.

When are the tea baggers gonna jump on the banks? And why haven't they jumped on the banks? Maybe because the tea baggers aren't legit protesters but astro-turf assholes organized and financed by the wealthy to harass the banks' only potential countervailing power?

If you're forgetting who gave us the Banksters' Great Depression, here's some of the criminals:

Wells Fargo Fined $85 Million By Fed Over Its Subprime Mortgage Lending Practices

In its largest consumer protection enforcement action ever, the Federal Reserve today slapped an $85 million penalty on Wells Fargo, a bank scrutinized for pushing subprime loans on borrowers who qualified for lower prime lending rates. According to the official press release, Wells Fargo received the order both for its strong-arming of borrowers into subprime loans and for falsifying income information on mortgage forms. In addition to the civil fine, the Federal Reserve mandated that the mega-bank compensate those borrowers who were adversely affected, estimated to number “between 3,700 and possibly more than 10,000.” Wells Fargo received $25 billion in the taxpayer-funded bailout.

http://thinkprogress.org/economy/201...fined-lending/

http://www.federalreserve.gov/newsev.../20110720a.htm

======

And still, not a peep out the tea baggers against the financial sector. :lol

$85M? How much did Wells-Fargo pocket from these 1000s of screwed customers?

A pittance for a crime like that. Men should hang lest others take encouragement.

Audit: Fed gave $16 trillion in emergency loans

The U.S. Federal Reserve gave out $16.1 trillion in emergency loans to U.S. and foreign financial institutions between Dec. 1, 2007 and July 21, 2010, according to figures produced by the government's first-ever audit of the central bank.

Last year, the gross domestic product of the entire U.S. economy was $14.5 trillion.

Of the $16.1 trillion loaned out, $3.08 trillion went to financial institutions in the U.K., Germany, Switzerland, France and Belgium, the Government Accountability Office's (GAO) analysis shows.

Additionally, asset swap arrangements were opened with banks in the U.K., Canada, Brazil, Japan, South Korea, Norway, Mexico, Singapore and Switzerland. Twelve of those arrangements are still ongoing, having been extended through August 2012.

Out of all borrowers, Citigroup received the most financial assistance from the Fed, at $2.5 trillion. Morgan Stanley came in second with $2.04 trillion, followed by Merill Lynch at $1.9 trillion and Bank of America at $1.3 trillion.

The audit also found that the Fed mostly outsourced its lending operations to the very financial institutions which sparked the crisis to begin with, and that they delegated contracts largely on a no-bid basis. The GAO report recommends new policies that would eliminate such conflicts of interest, and suggests that in the future the Fed should keep better records of their emergency decision-making process.

http://www.rawstory.com/rs/2011/07/2...e+Raw+Story%29

Is Bank of America At Risk of a Death Spiral?

First, the bank has been overly optimistic. It refused to write down $4.4 billion of goodwill from Countrywide until late last year, and maintained it would only suffer $4.4 billion [yes, the same number] in mortgage-related losses, then wrote off $19.2 billion more last quarter. Second, the bank appears to be in denial:

The crucial question today is whether Bank of America needs fresh capital to strengthen its balance sheet. Moynihan emphatically says it doesn’t, pointing to regulatory-capital measures that would have us believe it’s doing fine. The market is screaming otherwise, judging by the mammoth discount to book value. Then again, for all we know, the equity markets might not be receptive to a massive offering of new shares anyway, even if the bank’s executives were inclined to try for one.

Weil correctly depicts BofA as a systemic risk. And this confirms a point made by critics of so-called financial reforms, including yours truly, that the banks were not dealt harshly enough in the crisis

And let us tell you a dirty secret: while Bank of America, thanks to Countrywide, is patient zero of the housing mess, Wells is next in line. Residential real estate is proportionately even bigger relative to the bank’s earnings and balance sheet, its accounting has been somewhere between aggressive and misleading, and despite its pious claims otherwise, it is no better than any of the other big banks

http://www.nakedcapitalism.com/2011/...+capitalism%29

Moot point, because Wall St and Repugs have completely gutted CPFB and Wall St nixed Warren, and will probably nix the nominee, and will gut it further, with the Repugs totally underfunding/defunding it.



New Poll: Americans Overwhelmingly Support Consumer Financial Protection Bureau

Likely voters, including majorities of Independents, Democrats, and Republicans, favor the 2010 Dodd-Frank Wall Street Reform law by a 5 to 1 margin (71% vs. 14%).

Presented with information about challenges in Congress to the law, almost two-thirds (63%) believe that policymakers should allow the law to be fully implemented.

Three-quarters (74%) of voters support the existence of a single entity with the mission of protecting consumers from deceptive practices.


http://www.alternet.org/newsandviews...ection_bureau/

Quote:

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Originally Posted by Yves Smith

And let us tell you a dirty secret: while Bank of America, thanks to Countrywide, is patient zero of the housing mess

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Hardly a secret by now.

SEC Denied Rule Making It Easier For Shareholders To Exercise Control Over Corporate Boards

- A U.S. appeals court has rejected a new Securities and Exchange Commission rule intended to make it easier for shareholders to nominate directors to corporate boards.

In a major blow to the SEC, the U.S. Court of Appeals for the District of Columbia Circuit said the SEC's rule was "arbitrary and capricious" and that the agency had failed to properly weigh the economic consequences.

Friday's ruling marks the first successful legal challenge to a provision in last year's Dodd-Frank financial overhaul law which was intended to curb Wall Street excesses leading up to the global financial crisis.

The SEC rule, which had been put on hold pending the outcome of this case, would have required companies to include a shareholder candidate on corporate ballots known as proxies -- provided that the nominating shareholders held at least 3 percent of the voting power in the corporate stock for three years.

http://www.huffingtonpost.com/2011/0...comm_ref=false

Banks Increasingly Use Payday Loans Despite Crackdown On Predatory Lending

Two years after the recession officially ended and one year after the creation of a landmark financial law meant to prevent another financial crisis, predatory lending practices remain a part of mainstream American banking, a new report from the Center for Responsible Lending shows.

On Thursday, the CRL, a nonprofit research organization, published a report saying that some mainstream banks are offering payday loans -- short-term, high-interest loans that can take customers months to pay off.

Payday loans have long been offered by non-banking establishments, such as shops that cash checks and money orders. But in recent years, well-known banks have started offering them too.

Here’s how a payday loan works: You, the customer, borrow money from the bank. The bank lends it to you at a high APR, or annual interest rate.

When your next paycheck comes, the bank repays itself out of your direct deposit -- taking the loan, plus whatever interest the bank charges. It doesn’t matter if you don’t have enough money in your account; the bank goes ahead and repays itself anyway, even if this triggers overdraft fees. Often customers end up having to take out another loan to get by until the next paycheck -- and so the cycle continues.

The CRL report isn't the first indication that mainstream banks have adopted this practice, which is sometimes called a “direct deposit advance” or a “checking account advance.”

In 2010, Bloomberg reported that banks including Wells Fargo, U.S. Bancorp and Fifth Third Bancorp were offering services called “checking advance products” -- which functioned very similarly to payday loans -- as a way to recoup billions in lost revenue after new overdraft-fee regulations were passed.

http://www.huffingtonpost.com/2011/0...comm_ref=false

Should You Get Only $7000 if Wells Stole Your House?

If you are a too big to fail bank like Wells Fargo, the wages of crime look awfully good. RIp off as many as 10,000 people to the point where they lose their homes and your good friend the Fed will let you off the hook for somewhere between $1000 and $20,000 per house.

all the loss of your home is worth according to the Fed is your moving costs and maybe a month or two of rent.

http://www.nakedcapitalism.com/2011/...+capitalism%29

Fed to Wells: $7000 for Wrongful Foreclosure

http://www.creditslips.org/creditsli...redit+Slips%29

==========

All the right-wing assholes on this board were spewing the VRWC lie that the housing mess was the entire fault of F&F, CRA, Acorn, and lying borrowers.

cc lenders are the same predatory mofos everywhere.

Rise of Consumer Credit in Chile and Brazil Leads to Big Debts and Lender Abuses

Ms. Silva was among 418,000 clients in Chile who fell behind on their payments and had their debts repackaged by the retailer La Polar, which raised interest rates and extended loan terms without their knowledge. In early June, it came to light that executives at La Polar had been unilaterally renegotiating clients’ debts for more than six years. The news stunned Chileans and has become one of the biggest financial scandals of Chile’s 20-year economic boom.

“I share blame in this, but this company should have been more honorable and transparent,” said Ms. Silva, 30. “They were targeting people with more modest means. This became a vicious cycle that was never going to end.”

The scandal has underscored how South American countries — including Chile and Brazil, two of the region’s healthiest economies — are going through growing pains as the use of credit grows. The credit-fueled spending has driven extensive economic growth. But it has also opened the door to abuses, as credit issuers have used predatory techniques to lure customers, particularly young and less affluent ones, in countries where regulation is scant, annual interest charges can top 220 percent and consumers cannot seek bankruptcy protection, economists and consumer defense groups say.

The cases reveal troubling undercurrents in the South American economic boom: indiscriminate lending, lax regulation and ballooning over-indebtedness of large parts of the population, especially those with lower incomes.

http://www.nytimes.com/2011/07/24/bu...gewanted=print

=============

It takes two to tango, but these cc corps know exactly and much better their criminal game than do their poor, naive individual prey.

QE3 coming up, and this. If the Repugs want it, you know it's good for Wall St and bad for H-As

More Shades of TARP: Latest Deficit Ceiling Plan to Establish Extra-Constitutional Legislative Process

Debt ceiling negotiators think they’ve hit on a solution to address the debt ceiling impasse and the public’s unwillingness to let go of benefits such as Medicare and Social Security that have been earned over a lifetime of work: Create a new Congress.

This “Super Congress,” composed of members of both chambers and both parties, isn’t mentioned anywhere in the Constitution, but would be granted extraordinary new powers. Under a plan put forth by Senate Minority Leader Mitch McConnell (R-Ky.) and his counterpart Majority Leader Harry Reid (D-Nev.), legislation to lift the debt ceiling would be accompanied by the creation of a 12-member panel made up of 12 lawmakers — six from each chamber and six from each party.

Legislation approved by the Super Congress — which some on Capitol Hill are calling the “super committee” — would then be fast-tracked through both chambers, where it couldn’t be amended by simple, regular lawmakers, who’d have the ability only to cast an up or down vote. With the weight of both leaderships behind it, a product originated by the Super Congress would have a strong chance of moving through the little Congress and quickly becoming law. A Super Congress would be less accountable than the system that exists today, and would find it easier to strip the public of popular benefits. Negotiators are currently considering cutting the mortgage deduction and tax credits for retirement savings, for instance, extremely popular policies that would be difficult to slice up using the traditional legislative process.

House Speaker John Boehner (R-Ohio) has made a Super Congress a central part of his last-minute proposal.

The Tea Partiers make a fetish of invoking the Constitution when it suits them but will happily run roughshod over it when it conflicts with their pet wishes. Not that they are singularly guilty in this conspiracy against the public-at-large, but their faux holier-than-thou/populist pretense while aligning themselves with an elite power grab is particularly nausea-inducing.

I hate using the word “fascism” because overuse has weakened its bite, but trumped-up threat by trumped up threat, our government is moving relentlessly in that direction.

http://www.nakedcapitalism.com/2011/...+capitalism%29

Wall Street Donated Heavily To Boehner As The GOP Blocked Funding For Dodd-Frank

House Republicans, including Speaker of the House John Boehner (R-OH), were calling for repeal of the Dodd-Frank financial reform law even before it had passed. Once they achieved a majority, House Republicans worked to undermine the law by cutting the budgets of financial market regulators and trying to slow down the implementation of several of the law’s provision.

And Wall Street evidently appreciates the effort, donating heavily to Boehner over the first half of this year. As Bloomberg News reported, “three of the five biggest sources of Boehner’s campaign cash this year are employees of three Wall Street investment houses, a shift from the 2010 election cycle when such contributors weren’t ranked among his top 10 donors”:

Employees at the New York hedge fund Paulson & Co. contributed $61,050 to Boehner’s campaign account, more than any other company. New York-based Moore Capital Management LLP employees gave $53,000, while those at Cantor Fitzgerald LP donated $45,000.

No one from any of those companies donated to Boehner for his 2010 re-election campaign, according to the Center for Responsive Politics, a Washington-based research group that tracks political money. [...]

Boehner received most of the donations from Paulson & Co., Moore Capital and Cantor Fitzgerald in June, the same month the House voted along party lines to cut the budget of the Commodity Futures Trading Commission, which is writing most of the new derivatives rules, and the House Appropriations Committee voted to limit funding for the new consumer protection bureau.

http://thinkprogress.org/economy/201...tions-boehner/

JP Morgan Tells Investors Why Middle Class Americans Are Screwed

In a recent report in a JP Morgan memo to their investors from Michael Cembalest, the chief investment officer he says, “US labor compensation is now at a 50-year low relative to both company sales and US GDP.” Cembalest continues to explain why corporate profits are so strong while the rest of the working class are feeling the pinch, “reductions in wages and benefits explain the majority of the net improvement in margins.” 75% of the increase in profit margins directly correlate with the reduction in workers’ wages.

http://www.politicususa.com/en/jp-mo...iticus+USA+%29

Massachusetts Attorney General Signals Likelihood of Nixing “50 State” Mortgage Settlement

The banks in settlement talks with state and federal officials are seeking broad releases to protect them from legal claims. Massachusetts Attorney General Martha Coakley said yesterday she won’t support an agreement that includes releases for securitization of mortgages and conduct related to a database of mortgages known as MERS.

“Massachusetts will not sign on to any global agreement with the banks if it includes a comprehensive liability release regarding securitization and the MERS conduct,” Coakley wrote to the Norfolk County register of deeds in Dedham, Massachusetts. “These investigations must continue.” The registry keeps real estate records.

http://www.nakedcapitalism.com/2011/...+capitalism%29

This Is Considered Punishment?

surprising news that the Federal Reserve has issued a cease-and-desist order against a Too-Big-to-Fail bank. The bank was Wells Fargo, which was also fined $85 million and ordered to compensate customers it had unfairly — indeed, illegally — taken advantage of during the subprime bubble.

What made the news surprising, of course, was that the Federal Reserve has rarely, if ever, taken action against a bank for making predatory loans. Alan Greenspan, the former Fed chairman, didn’t believe in regulation and turned a blind eye to subprime abuses. His successor, Ben Bernanke, is not the ideologue that Greenspan is, but, as an institution, the Fed prefers to coddle banks rather than punish them. That the Fed would crack down on Wells Fargo would seem to suggest a long-overdue awakening.

Yet, for anyone still hoping for justice in the wake of the financial crisis, the news was hardly encouraging. First, the Fed did not force Wells Fargo to admit guilt — and even let the company issue a press release blaming its wrongdoing on a “relatively small group.” The $85 million fine was a joke; in just the last quarter, Wells Fargo’s revenues exceeded $20 billion. And compensating borrowers isn’t going to hurt much either. By my calculation, it won’t top $20 million.

Most upsetting of all, the settlement raises the question that just won’t go away: Why can’t the federal government prosecute financial wrongdoers?

I realize that the Federal Reserve can’t bring a criminal case (and, to be fair, there are statutory limits on how big a fine it can levy). But the Justice Department certainly can. Yet ever since it lost an early case against two Bear Stearns fund managers in 2009, it has gone after only the smallest of small fry: individual borrowers, brokers and appraisers who lack the means to do much more than plead guilty.

http://www.nytimes.com/2011/07/26/op...gewanted=print

Wells Fargo Target Of Justice Department Probe; Agency Alleges Discriminatory Lending

The Department of Justice is preparing a lawsuit against Wells Fargo, the nation's largest home mortgage lender, for allegedly preying upon African American borrowers during the housing bubble and steering them into high-cost subprime loans, according to three people with direct knowledge of the probe.

The company, the fourth-largest U.S. bank by assets, is currently embroiled in pre-lawsuit negotiations with the Justice Department in hopes it will settle the accusations and avoid a public lawsuit

http://www.huffingtonpost.com/2011/0...comm_ref=false

==========

This is a REGULATED bank

Right-wingers, tell us again how CRA, F&F were the overwhelming, only?, causes of the housing bubble?

A W-F is regulated, the vast number of subprime mortgages were initiated by non-bank lenders and non-regulated subsidiaries of regulated banks, created specifically get into the non-prime market.

CRA? F & F? G M A F B, you Wall St shills.

Quote:

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CRAF&F?GMAFB

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Internal Doc Reveals GMAC Filed False Document in Bid to Foreclose


GMAC, one of the nation's largest mortgage servicers, faced a quandary last summer. It wanted to foreclose on a New York City homeowner but lacked the crucial paperwork needed to seize the property.

GMAC has a standard solution to such problems, which arise frequently in the post-bubble economy. Its employees secure permission to create and sign documents in the name of companies that made the original loans. But this case was trickier because the lender, a notorious subprime company named Ameriquest, had gone out of business in 2007.

And so GMAC, which was bailed out by taxpayers in 2008, began looking for a way to craft a document that would pass legal muster, internal records obtained by ProPublica show.

"The problem is we do not have signing authority—are there any other options?" Jeffrey Stephan, the head of GMAC's "Document Execution" team, wrote to another employee and the law firm pursuing the foreclosure action. No solutions were offered.

Three months later, GMAC had an answer. It filed a document with New York City authorities that said the delinquent Ameriquest loan had been assigned to it "effective of" August 2005. The document was dated July 7, 2010, three years after Ameriquest had ceased to exist and was signed by Stephan, who was identified as a "Limited Signing Officer" for Ameriquest Mortgage Company. Soon after, GMAC filed for foreclosure.

=========

Yep, CRA, F&F was right there with GMAC every fraudulent step of the way. :lol

Will GMAC "settle"?

Quote:

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Originally Posted by Winehole23

Quote:

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CRAF&F?GMAFB

---

---

Does it matter? Looks who's saying it.

Cra

f&f

gmafb

gfy, wc, wh

Quote:

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Originally Posted by boutons_deux

Cra

f&f

gmafb

gfy, wc, wh

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lol @ babytalk.:lol

Quote:

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Originally Posted by TeyshaBlue

lol @ babytalk.:lol

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Uh-oh. Syntax errors. Looks like the boutons-bot needs a reboot. :)

community reinvestmeant act

fanny and freddy

go fuck yourself

I have little respect for people who still try to save texting space when unnecessary.

I didn't know we have a 160 character limitation...

With few exceptions, I say we should all use full words. To do otherwise is being lazy.

Quote:

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Originally Posted by Wild Cobra

I have little respect for people who still try to save texting space when unnecessary.

I didn't know we have a 160 character limitation...

With few exceptions, I say we should all use full words. To do otherwise is being lazy.

---

I dnt tnk nebody givs a sht tbh

State Accuses Bank of America Unit of Thousands of Illegal Foreclosures

State Attorney General Rob McKenna has accused a Bank of America unit of conducting thousands of illegal foreclosures in Washington, in which he said the company had confused homeowners, made it nearly impossible to save their homes, and failed to act as a neutral third party.

McKenna sued ReconTrust, a California-based foreclosure trustee, in King County Superior Court Thursday.

The lawsuit alleges that the Bank of America subsidiary has violated state laws in "each and every foreclosure" in Washington. Since 2008, ReconTrust, which forecloses statewide, has done 9,900 foreclosures in King, Pierce and Snohomish counties alone.

"ReconTrust ignored our warnings, repeatedly broke the law and refused to provide information requested during our investigation," McKenna said in a statement Friday.

"ReconTrust's illegal practices make it difficult, if not impossible, for borrowers who might have a shot at saving their homes to stop those foreclosures."

http://www.seattlepi.com/local/artic...#ixzz1URKtWfqw

Federal probes of mortgage lenders fizzle

Federal criminal investigations into failed mortgage lenders IndyMac Bancorp and New Century Financial Corp have stalled, the Wall Street Journal reported on Saturday.

A third probe, into Washington Mutual Inc (WaMu), has ended with no charges being filed, the Department of Justice said.

Topics
Chicago Mortgages
Mortgages
Finance
See more topics »

Both the IndyMac and Century Financial investigations were essentially dormant, the newspaper said, citing people familiar with the situation. Both probes could still gain new momentum if fresh evidence surfaced, the newspaper said.

The three investigations were among the first to weigh criminal charges against the companies and executives at the heart of the housing crisis, which was in part caused by offering so-called sub-prime loans to people who may not have otherwise qualified for credit.

Investigators have struggled to prove intentional wrongdoing, which is required to secure a conviction, particularly in relation to decisions signed off by in-house lawyers, the newspaper said, citing its sources.

http://www.chicagotribune.com/busine...,3126175.story

============

Excellent templates for criminals to follow in the future.

More Bank of America Deathwatch: AIG to Seek $10+ Billion for Dud Mortgages

As you may recall, in the previous quarter, Bank of America announced its $8.5 billion mortgage settlement, which is now looking pretty wobbly, since a variety of unhappy parties, the latest being New York attorney general Eric Schneiderman, have taken aim at it. And Delaware attorney general Beau Biden is reported to be joining the pile on this week. This means either no deal, or a very different deal (almost certainly with bigger numbers attached) after a long slugfest, um, negotiations. The Charlotte bank had said it would increase loss reserves in the second quarter by $20 billion (which included this $8.5 billion) and claimed this would put its mortgage woes behind them. Yours truly was skeptical, and the market reacted badly when it saw the revelation in their 10-Q filing just released, that the bank was going to take more losses on Fannie and Freddie putbacks than previously expected.

The latest revelation, that AIG is expected to file a suit that will seek more than $10 billion in damages against Bank of America on Monday, comes from Louise Story and Gretchen Morgenson of the New York Times:

The American International Group is planning to sue Bank of America over hundreds of mortgage-backed securities, adding to the surge of investors seeking compensation for the troubled mortgages that led to the financial crisis.

The suit seeks to recover more than $10 billion in losses on $28 billion of investments, in possibly the largest mortgage-security-related action filed by a single investor.

It claims that Bank of America and its Merrill Lynch and Countrywide Financial units misrepresented the quality of the mortgages placed in securities and sold to investors.

Note that this is yet another representation and warranty suit, the very same type of liability that BofA was trying to extinguish in its $8.5 billion settlement. Clearly BofA thinks that the amount of the settlement, which looks to be 3.5% of the estimated liability, is a little light(some of the aggrieved parties say the liability across all of the 530 pools included in the settlement is $242 billion). MBS rep and warranty cases have never gone to trial, since they are too costly to perfect (they wind up being fought on a loan by loan basis, even if sampling is done, since the plaintiff must not only establish that the loans were worse than promised, but also that they went bad because they were substandard, not because the borrower lost his job or suffered a medical emergency or had some other “shit happens” normal underwriting loss).

http://www.nakedcapitalism.com/2011/...+capitalism%29

Why Are the Big Banks Getting Off Scot-Free?

For most citizens, one of the mysteries of life after the crisis is why such a massive act of looting has gone unpunished. We’ve had hearings, investigations, and numerous journalistic and academic post mortems. We’ve also had promises to put people in jail by prosecutors like Iowa’s attorney general Tom Miller walked back virtually as soon as they were made.

Yet there is undeniable evidence of institutionalized fraud, such as widespread document fabrication in foreclosures (mentioned in the motion filed by New York state attorney general Eric Schneiderman opposing the $8.5 billion Bank of America settlement with investors) and the embedding of impermissible charges (known as junk fees and pyramiding fees) in servicing software, so that someone who misses a mortgage payment or two is almost certain to see it escalate into a foreclosure. And these come on top of a long list of runup-to-the-crisis abuses, including mortgage bonds having more dodgy loans in them than they were supposed to, banks selling synthetic or largely synthetic collateralized debt obligations as being just the same as ones made of real bonds when the synthetics were created for the purpose of making bets against the subprime market and selling BBB risk at largely AAA prices, and of course, phony accounting at the banks themselves.

http://www.nakedcapitalism.com/2011/...+capitalism%29

http://www.salon.com/news/opinion/gl...aud/index.html

15 former investors sue over Countrywide lending practices


Bank of America Corp. was sued by 15 former Countrywide Financial Corp institutional investors who said they lost money after being misled about the mortgage lender's financial condition and lending practices.

BlackRock Inc., the California Public Employees' Retirement System (CalPERS), T Rowe Price Group Inc., TIAA-CREF and the other plaintiffs, including some in Europe, sued in Los Angeles federal court, after deciding not to join a $624 million settlement that won court approval in February.

These plaintiffs believed they could recover more by suing on their own over the "massive and pervasive" fraud at Countrywide, which Bank of America bought July 1, 2008.

Thursday's lawsuit deepens the legal problems for Bank of America over Countrywide, for which it paid $2.5 billion. Analysts have estimated that its ultimate cost, including legal bills and loan losses, could exceed 10 times that sum.

Last month, the Charlotte, N.C.-based bank entered an $8.5 billion agreement to end most litigation by investors who bought securities backed by risky Countrywide home loans. Some of those investors have complained this agreement too may be unfair.

According to the 425-page complaint by the 15 plaintiffs, Countrywide and officials such as former Chief Executive Angelo Mozilo abandoned prudent lending, reserved too little for bad loans and inflated earnings, in a drive to triple market share to 30 percent and enrich themselves.


http://www.chicagotribune.com/busine...,7652641.story

(whiff)

Blackrock, Calpers are heavy hitters. Their legal beagles must have told them that they had a case (or maybe the legal beagles are also screwing them with fraudulent legal products).

But as always, any "settlement" will be against a Corporate-American, while human criminals will go "scot-free" with the pockets stuff full.

Highlighting the actions of Delaware AG Beau Biden.

Bank Of America Has Activist Arrested For Telling It About Dangerous Vacant Homes It Owns

http://thinkprogress.org/wp-content/...08/goddard.jpg

Two weeks ago, the Chicago city council passed a new statute that “will make lenders liable for the upkeep of vacant homes even when the borrower still holds the title.” The law was passed unanimously and will take effect in September. The importance of this new law came into focus last week when two firefighters were injured battling a fire that sprung up in a vacant home in the Englewood neighborhood on the south side of Chicago.

As Aaron Krager notes, this outraged activists from Action Now, a local community group. Marsha Goddard, who is a board member of the organization, led a group of five people to a local branch of Bank of America, which owned the vacant property, to inform the bank about code violations that it would be liable for when the law goes into effect.

The megabank responded by having Goddard arrested.


http://thinkprogress.org/economy/201...rica-activist/

Quote:

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Originally Posted by Winehole23

Highlighting the actions of Delaware AG Beau Biden.

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hot dam! Another blue state kickin ass.

Any bubba red states gonna join in?

Or will the Repug states let their bubbas asses get terminally kicked by the Banksters?

Repugs, governing for ALL Americans ..... who are wealthy. :lol

Quote:

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Originally Posted by boutons_deux

"If we didn't have politicians bailing them out with our money"

Wall Streeters, current/past/future, decided/extorted the bailout. Place the guilt and crime where it belongs. Wall St does the corrupting, not Congress.

---

To be a Corrupter one need a Corruptee. If Congress were even slightly incorruptible, wouldn't matter who was doing the corrupting. Further, if Congress/US Govt. didn't have such vast powers - if they were even a little bit restricted on what they could do with our money - their corruption would be much less relevant. Finally, there is nothing you or I can about the greedy people on Wal Street; we can, however, recognize the power we have by changing Washington. If we keep getting distracted by bogeymen we can do nothing about; they win.

"If Congress were even slightly incorruptible"

GMAFB.

Even if a naive, virgin Congress person (who can be innocent and naive after getting through the cesspool of winning an election?), the SYSTEM IS CORRUPTED beyond remediation.

"the power we have by changing Washington"

GMAFB. Human-Americans have NO POWER in DC, they are totally disenfranchised. UCA and capitalists pay those pipers, and UCA and capitalists call the tunes.

The top 5% have amassed such wealth, and the self-enriching/protecting power that flows from that wealth, have compromised/bought the only countervailing power (government), that there is no way short of violent revolution to Take Back That Power.

People with such power never yield it, and ALWAYS abuse it.

Quote:

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Originally Posted by boutons_deux

People with such power never yield it, and ALWAYS abuse it.

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Which is why limited government is essential.

"limited government is essential."

ok, just to humor you along, what incredible, country-destroying limits, specifically, do you want on govt.

(we already know most conservatives don't consider the military, their MIC of a Golden Goose, to be part of govt, so we're gonna blow $7T+ on military over the next 10 years, the MIC-financed hawks are already screaming about the automatic cuts military included when the triggers are tripped)

Quote:

---

Originally Posted by boutons_deux

"limited government is essential."

ok, just to humor you along, what incredible, country-destroying limits, specifically, do you want on govt.

(we already know most conservatives don't consider the military, their MIC of a Golden Goose, to be part of govt, so we're gonna blow $7T+ on military over the next 10 years, the MIC-financed hawks are already screaming about the automatic cuts military included when the triggers are tripped)

---

:lol

He Mr. Socialist, what's your take on the great socialist society of England
right now. They have no military to speak of, most of their industry is
socialized and you can draw unemployment forever. And their great
social medicine leaves people to die.

So you tell us how to cure all the ills of the world.

Oh, I forgot, the EU is lining up for loans and to get bailed out. Germany
is going to try, but they just don't got that much money, no one does.

Your are an ignorant twerp!

:lol

Contrast with conservative america, where trillions we don't have are spent on building the mightiest army in the world, yet can barely handle a shithole whose major tech is probably an RPG. The great capitalist medicine where the government ends up paying more per capita than those wasteful 'social medicine' states, and is directly associated with almost half the bankruptcies in the country. And their industry which is being outsourced at an alarming rate since they simply can't compete with the rest of the world.

So you tell us how to cure all the ills of the world.

Oh, I forgot, the US credit rating is even worse than some of those EU countries. Maybe the US needs to ask France to bail it out!

You are an ignorant twerp!

If only being American made us immune, I might laugh too.

Quote:

---

Originally Posted by Winehole23

If only being American made us immune, I might laugh too.

---

Mismanagement isn't an exclusive attribute of the left or right or a certain country.

Nor arrogance, neither.

Quote:

---

Originally Posted by ElNono

:lol

Contrast with conservative america, where trillions we don't have are spent on building the mightiest army in the world, yet can barely handle a shithole whose major tech is probably an RPG. The great capitalist medicine where the government ends up paying more per capita than those wasteful 'social medicine' states, and is directly associated with almost half the bankruptcies in the country. And their industry which is being outsourced at an alarming rate since they simply can't compete with the rest of the world.

So you tell us how to cure all the ills of the world.

Oh, I forgot, the US credit rating is even worse than some of those EU countries. Maybe the US needs to ask France to bail it out!

You are an ignorant twerp!

---

So much for our educational system. The products of this system
can't recognize up from down.

Outsourced, we can't compete, credit rating. You idiot, what brought us to this point. It damn sure wasn't free enterprise. It was idiots like you
Socialist. Noooooooooo, don't read history it might just tell you what
made this country.

Bye the way, would you like to tell me which social programs made a
country great? I can point you to several that took them down. Of
course, you may not read alot or watch any news other than MSNBC
and other like them.

Yeah, I am so damn ignorant that I survived for 78 years in this world
without you damn help. How is that hope and change working for you
twerp?

Quote:

---

Originally Posted by xrayzebra

Outsourced, we can't compete, credit rating. You idiot, what brought us to this point. It damn sure wasn't free enterprise. It was idiots like you Socialist. Noooooooooo, don't read history it might just tell you what made this country.

---

This isn't the past, ray. There's not going to be another industrial revolution.
You won't be owning slaves anytime soon again.
We're only separated a decade from the last full conservative government.
What did they do for your glorious free enterprise? Medicare Part D?

How about your icon, Ronnie? Run up the debt, jacked up taxes.
That's what brought us to this point too, you know?

Quote:

---

Originally Posted by xrayzebra

Bye the way, would you like to tell me which social programs made a country great? I can point you to several that took them down. Of course, you may not read alot or watch any news other than MSNBC and other like them.

---

Social programs help people with real needs every day. There's absolutely no doubt there's abuses in them, like in everything else. That doesn't mean they're useless, or that they brought any country 'down'.

Quote:

---

Originally Posted by xrayzebra

Yeah, I am so damn ignorant that I survived for 78 years in this world
without you damn help. How is that hope and change working for you
twerp?

---

It's time to take your meds old man. That selective memory is certainly acting up again. Hope and Change is not working for me, because there was no Hope and Change. This guy is Bush Jr Jr.

Quote:

---

Originally Posted by xrayzebra

So much for our educational system. The products of this system can't recognize up from down.

---

Obviously, you've got a great educational career before you went military, since we know many highly educated, successful people join the military.

Quote:

---

Outsourced, we can't compete, credit rating. You idiot, what brought us to this point. It damn sure wasn't free enterprise. It was idiots like you Socialist. Noooooooooo, don't read history it might just tell you what
made this country.

---

unregulated capitalism, not socialism, killed the US jobs market.

Quote:

---

Bye the way, would you like to tell me which social programs made a
country great?

Quote:

---

UK, France, Germany, the Scandanavian countries, Switzerland, are all "social democracies), on average have very comfortable lives, strong safety nets, better/cheaper health care systems, strong unions that work with mgmt not against it so both sides win. And they are very pissed at how their bankers in collusion with/lead by US bankers have fucked up the world's economy. The socialists didn't fuck it up.

---

Yeah, I am so damn ignorant that I survived for 78 years in this world
without you damn help. How is that hope and change working for you
twerp?

---

you've been on taxpayer funded "socialized medicine" since you were 65, and probably on taxpayer/socialized retirement/VA-medical care for probably 20+ years before that. right?

Have you noted how the Repugs want to fuck over the military retirees to pay for the unregulated/ultra-capitalistic Banksters' Great Depression?

btw, the military has done fuck all for me, or America, in VN, Kuwait, Iraq, or Afghanistan.

Bank of America ‘much better’ now: CEO

Bank of America is in a better position now than during the financial crisis, chief executive Brian Moynihan said Wednesday, trying to reassure investors after sharp losses in the share price.

"The fundamentals are so much better in our country and in our company and in our industry than they were four years ago," he said in a conference call with analysts.

Amid rising concerns about the growing number of lawsuits facing the country's biggest bank by deposits, Moynihan insisted that "we continue to clean up the mortgage issues" related to the acquisition of Countrywide Financial in 2008.

On Monday shares plunged more than 20 percent after US insurer AIG sued Bank of America for $10.5 billion, accusing it of "massive fraud" over dodgy mortgage-based securities AIG bought from Countrywide Financial, the former mortgage giant that the bank took over in 2008.

After partially rebounding Tuesday, the bank's shares sank another 10.9 percent to $6.77 Wednesday, leaving them down 29 percent from a week ago.

In June, the bank announced an $8.5 billion settlement with a group of more than 20 major investors over losses on mortgage-backed securities, which AIG has also raised questions about.

Moynihan was not CEO when Bank of America bought the company, but said there were not many days when he thinks "positively about Countrywide."

http://www.rawstory.com/rs/2011/08/1...e+Raw+Story%29

==========

Finally, We Get The Truthiness About BoA! :lol

So now BoA can buy back all the toxic shit sold to Geithner? :lol

Bank Of America Death Watch Update!

Bank of America continues slouching toward destruction, with its stock price tanking (down nearly 50% since the start o the year), credit default swaps (basically, wagers on its default) up, layoffs coming, and theoretically under the Dodd-Frank financial reform law, no bailout in sight.

Buried yesterday in a Bloomberg piece was the seeming throwaway line that "Bank of America’s bond-insurance prices last week surged to a rate of $342,040 a year for coverage on $10 million of debt, above where Lehman Brothers Holdings Inc. (LEHMQ)’s bond insurance was priced at the start of the week before the firm collapsed."

http://www.alternet.org/module/print...ndviews/654654

Corrupt Obama Administration Pressuring New York Attorney General to Support Mortgage Whitewash

The Administration has now taken to pressuring parties that are not part of the machinery reporting to the President to fall in and do his bidding. We’ve gotten so used to the US attorney general being conveniently missing in action that we have forgotten that regulators and the AG are supposed to be independent. As one correspondent noted by e-mail, “When officials allegiances are to El Supremo rather than the Constitution, you walk the path to fascism.”

Team Obama bears all the hallmarks of being so close to banks and big corporations that it has lost all contact with and understanding of mainstream America.

The latest example is its heavy-handed campaign to convert New York state attorney general Eric Schneiderman to a card carrying member of the “be nice to our lords and masters the banksters” club. Schneiderman was the first to take issue with the sham of the so-called 50 state attorney general mortgage settlement. As far as the Administration is concerned, its goal is to give banks a talking point and prove to them that Team Obama is protecting their backs in a way that the chump public hopefully won’t notice.

The Administration joined this effort to hurry it forward and assure it resulted in a suitably financier-friendly outcome. And it has done so despite recent HUD inspector general’s audits finding that the five biggest servicers were defrauding taxpayers. We’ve heard not a peep of follow up on that front; instead, the Administration keeps leaking its tired “A settlement is just around the corner” story.

Schneiderman is far from the only person to see what a sellout this “settlement” is. The basic premise of a settlement is to obtain some sort of restitution to induce a prosecutor/plaintiff to drop a current or likely lawsuit. For the aggrieved party to get a good settlement, it needs to have a credible case, as in facts (a smoking gun or two) and a legal theory as to why those facts mean the perp is in hot water.

http://www.nakedcapitalism.com/2011/...+capitalism%29

Lender Processing Services Law Firm Targeting April Charney, Foreclosure Defense Pioneer

You know the powers that be are pretty desperate when they feel compelled to go after a Legal Aid attorney.

Admittedly, April Charney is no ordinary Legal Aid attorney. She was one of the first lawyers to focus on the question of whether party showing up in court really was the right party and whether it could demonstrate that it had the right to foreclose. Most judges (as in the non-captured-by-corporations kind) regard these as threshold issues. If someone shows up in court claiming that you owe them money and they want the judge to garnish your wages, I’m sure you’d want the judge to listen if the person who wanted your money couldn’t prove he had gotten your IOU from the chap who had made a loan to you years ago.

Charney has helped lawyers in Florida and around the US with these types of arguments, and has also been active in the group of lawyers working with Max Gardiner in North Carolina. She’s a diligent researcher and keeps on top of the rulings in her arena.

In some ways I’m surprised this hasn’t happened sooner, but pro bank members of the Florida bar are apparently orchestrating an effort to get Charney fired from Legal Services of Jacksonville, which on its face is absurd. If you want to help April, 4ClosureFraud has provided names and contact information of the JALA (I assume Jacksonville Area Legal Aid) board members. I hope you tell them (nicely) that getting rid of Charney, given her track record, would raise a lot of questions and likely very unfavorable press for JALA.

By way of background, Lender Processing Services, a firm that provides various software platforms and other services to mortgage servicers, is in a great deal of hot water. Its stock is down over 50% despite buybacks to prop it up, largely as a result of litigation taking aim at its dubious business model (see here and here for background).

On August 3, Holland & Knight attorneys Buddy Schulz and Dominic MacKenzie and Duval County Circuit Court Judge Hugh Carithers hosted an informal lunch at the law offices with 10 members of the board of Jacksonville Area Legal Aid and JALA board president Hugh Cotney. A painting of a pod of sharks that hangs in the lobby of Holland & Knight offices set the tone.

It was kind of a covert friendly little conversation over lunch,” she said, “but it felt like a mutiny.”

http://www.nakedcapitalism.com/2011/...e-pioneer.html

Bank of (the country) America after nationalization?

It's Time For A New Kind Of Bank Of America Solution—The Right Kind


Bank of America's stock is tanking because Bank of America's investors don't believe its assets are worth what Bank of America says they are worth.

http://www.businessinsider.com/all-r...ht-kind-2011-8

Quote:

---

Originally Posted by boutons_deux

Bank of (the country) America after nationalization?

It's Time For A New Kind Of Bank Of America Solution—The Right Kind


Bank of America's stock is tanking because Bank of America's investors don't believe its assets are worth what Bank of America says they are worth.

http://www.businessinsider.com/all-r...ht-kind-2011-8

---

That's essentially what some of us thought should have happened to all the tbtf's in '08.

Quote:

---

Originally Posted by SnakeBoy

That's essentially what some of us thought should have happened to all the tbtf's in '08.

---

Don't know specifically about you, but when that was done with GM, a bunch of people here cried Socialism! :cry :cry :cry

I'm sure the hypocritical tea baggers would scream like hell about nationalizing all the bankrupt TBTF banks as socialism, communism, Sharia, terrorism.

Let us know when the tea baggers target the financial sector as the real culprits screwing up the planet, rather the govts.

Bank Of America Forecloses On Man Two Days After Approving His Mortgage Modification

falo on Aug 24, 2011 at 9:40 am

America’s biggest banks have produced a litany of foreclosure horror stories recently, from Chase bank selling a off a soldier’s home on the very same day that he returned from Iraq to a women losing her home to foreclosure even after scrounging together $50,000 in back mortgage-payments that the bank said she owed. Wells Fargo foreclosed on one borrower for missing a few payments…after Wells Fargo specifically the borrower to miss a few payments.

Bank of America also has a deep list of mortgage misdeeds, from improperly foreclosing on a family and stealing its pet parrot to blatantly violating its contract with Treasury after joining one of the administration’s anti-foreclosure programs. And BofA has been arguably the least capable bank when it comes to getting borrowers into sustainable mortgage modifications, due to its inability to keep paperwork straight or review cases in a timely manner.

He finished the application process [for a mortgage modification] and continued making his payments, knowing lenders were backed up with modification requests. [...] Finally, on April 10, a letter. But not the one he was expecting. “According to our records, payment for your home loan is past due,” it said. Conca finally called a lawyer for help, and the lawyer corresponded with the lender, but got nowhere.

Then on July 19, Conca received a letter saying he was approved for a rate reduction on a modified mortgage and he’d receive the paperwork in 10 days.

Relief, but it was only temporary.

Two days later he received a different kind of letter from Bank of America: a notice of intention to foreclose.

http://thinkprogress.org/economy/201...loses-two-day/

Schneiderman has refused to accept the whitewash and token "settlement", plus bank immunity from other prosecutions, so the White (Wall St) House kicks him out:

New York Attorney General Kicked Off Government Group Leading Foreclosure Probe

WASHINGTON -- New York Attorney General Eric Schneiderman on Tuesday was kicked off the committee leading the 50-state task force charged with probing foreclosure abuses and negotiating a possible settlement agreement with the nation's five largest mortgage firms, according to an email reviewed by The Huffington Post.

Schneiderman was one of roughly a dozen state attorneys general leading the talks with the five companies, alongside representatives of the U.S. Department of Justice, the Department of Housing and Urban Development and other federal agencies. The government launched the negotiations in the spring after widespread reports of foreclosure irregularities, such as so-called "robo-signing" and illegal home seizures, emerged.

But state prosecutors and federal officials are pressing to complete a proposed settlement with the five companies even though they've initiated only a limited investigation that hasn't examined the full extent of the alleged wrongdoing, The Huffington Post reported last month. Elizabeth Warren, who until recently was a senior adviser to President Barack Obama and Treasury Secretary Timothy Geithner, told a congressional panel last month that government agencies may not have sufficiently investigated claims that borrowers' homes were illegally seized.

Schneiderman, a Democrat who's in his first term as New York's top law enforcer, has been among a group of state legal officers who has also questioned the desire for a speedy resolution. He's leading his own investigation into mortgage improprieties, subpoenaing documents from the nation's largest financial institutions and reviewing court records for possible illegal home repossessions.

http://www.huffingtonpost.com/2011/0...=Daily%20Brief

Obama's Deal for the Bankers: Amnesty for the Indefensible

They will get away with it, at least in this life. “They” are the Wall Street usurers, people of a sort condemned in Scripture, who have brought more misery to this nation than we have known since the Great Depression. “They” will not suffer for their crimes because they have a majority ownership position in our political system. That is the meaning of the banking plea bargain that the Obama administration is pressuring state attorneys general to negotiate with the titans of the financial world.

It is a sellout deal that, in return for a pittance of compensation by banks to ripped-off mortgage holders, would grant the banks blanket immunity from any prosecution. That is intended to short-circuit investigations by a score of aggressive state officials, inquiries that offer the public a last best hope to get to the bottom of the housing scandal that has cost U.S. homeowners $6.6 trillion in home equity in the past five years and left 14.6 million Americans owing more than their homes are worth.

The $20 billion or so that the banks would pony up is chump change to them compared with the trillions that the Fed and other public agencies spent to bail them out. The banks were given direct cash subsidies, virtually zero-interest loans, and the Fed took $2 trillion in bad paper off their hands while the banks exacerbated the banking crisis they had created through additional shady practices, including fraudulent mortgage foreclosures.

Yet the administration has rushed to the aid of the banks once again and is attempting to intimidate the few state attorneys general who have the gumption to protect the public interest they are sworn to serve. As Gretchen Morgenson of The New York Times reported:

“Eric T. Schneiderman, the attorney general of New York, has come under increasing pressure from the Obama administration to drop his opposition to a wide-ranging state settlement with banks over dubious foreclosure practices. …

“In recent weeks, Shaun Donovan, the secretary of Housing and Urban Development, and high-level Justice Department officials have been waging an intensifying campaign to try to persuade the attorney general to support the settlement. …”

Donovan has good reason not to want an exploration of the origins of the housing meltdown: He has been a big-time player in the housing racket for decades. Back in the Clinton administration, when government-supported housing became a fig leaf for bundling suspect mortgages into what turned out to be toxic securities, Donovan was a deputy assistant secretary at HUD and acting Federal Housing Administration commissioner. He was up to his eyeballs in this business when the Clinton administration pushed through legislation banning any regulation of the market in derivatives based on home mortgages.

Armed with his insider connections, Donovan then went to work for the Prudential conglomerate (no surprise there), working deals with the same government housing agencies that he had helped run. As The New York Times reported in 2008 after President Barack Obama picked him to be secretary of HUD, “Mr. Donovan was a managing director at Prudential Mortgage Capital Co., in charge of its portfolio of investments in affordable housing loans, including Fannie Mae and the Federal Housing Administration debt.”

http://www.thenation.com/print/artic...y-indefensible

==========

iow, the capitalists have quite obviously violated fundamental property title law in the $100Bs or $Ts, a crime too numerous and Too Big To Prosecute.

Note how it's the red-state Repug AGs pushing to let the capitalists escape free and clear.

Right-wingers, tell us again how ACORN, F&F, CRA, and stupid mortgage owners (allowed by predatory, corrupt lenders to go) in over their heads caused the Banksters' Great Depression.

Quote:

---

Originally Posted by boutons

Note how it's the red-state Repug AGs pushing to let the capitalists escape free and clear.

---

Obama holds the whip hand, according to your source.

Quote:

---

Originally Posted by boutons_deux

Note how it's the red-state Repug AGs pushing to let the capitalists escape free and clear.

---

Note how your article contains exactly zero references to red state republican AG's.

lol boutons.

Quote:

---

Originally Posted by coyotes_geek

Note how your article contains exactly zero references to red state republican AG's.

lol boutons.

---

"The email announcing Schneiderman's dismissal from the states' executive committee was sent just after noon to more than 50 people by Patrick Madigan, a top lawyer in the Iowa Attorney General's Office. It read: "Effective immediately, the New York Attorney General’s Office has been removed from the Executive Committee of the Robosigning multistate."

''Kanner said Schneiderman was removed at Iowa Attorney General Tom Miller's "prerogative.""

New York has actively worked to undermine the very same multistate group that it had spent the previous nine months working very closely with," Miller continued. "While we certainly respect the right of any state to choose to no longer participate in a multistate and to pursue another path, working to actively undermine a multistate while still a member of the Executive Committee simply doesn’t make sense, is unprecedented and is unacceptable. Accordingly, today I informed New York that it is no longer a member of the Executive Committee."

=========

IOWA is deeply, weirdly RED.

Judge Suspends All Federal Court Foreclosures In Rhode Island

The backbone of American real estate law is a network of state-run registries, which track who owns what properties and whether the property is subject to any encumberances such as a mortgage. In the 1990s, however, the banking industry created MERS as an alternative, privatized registry that would allow banks to transfer mortgages more quickly in order to facilitate the creation of the kind of mortgage-backed securities that were a centerpiece of the recent economic crisis.

MERS’ attorneys essentially argue that it should be above legal scrutiny because it is too big to enjoin.

it will be interesting to see whether the banking industry attempts to discredit last week’s decision by noting that it was handed down by newly-confirmed Judge John McConnell. The Chamber of Commerce led a blistering campaign of obstruction against McConnell’s nomination because he committed the unforgivable sin of trying to hold lead paint companies and the tobacco industry accountable to their consumers.

http://thinkprogress.org/justice/201...-rhode-island/

==========

Yet another capitalists escape clause:

MERS Is Too Big To Enjoin.

aka, above the law, as MERS and its motherfucker bankers rip off real wealth from Human-Americans.

Some of these mortgage companies are UNBELIEVABLY incompetent. One of my sisters died of breast cancer in April 2010. I am the executor of the estate. Long story, but after her cancer returned and metastasized she basically said fuck it and quit paying taxes (she was single, no heirs, and self employed). Consequently she ended up with 130K of tax liens and penalties on her condo in Dallas, putting her massively upside down in it. Immediately after her death I moved everything out, cleaned it up, and called GMAC Mortgage and said "hey guys, sorry, but here's the scoop...I'm offering to give you n immediate voluntarily foreclosure...we don't want the condo and don't have to pay for it and aren't gonna pay for it. Lets make this quick and easy and you just send me the papers you want signed."

That was 16 months ago. They have done NOTHING. I've send them notarized releases from all the potential heirs (parents and siblings) releasing any claim to the condo. I am STILL getting calls weekly from random call centers wanting to know if I'm SURE I really don't want that condo...

What the fuck? do they just not want to book the repo? I've told them a hundred times if I've told them once...verbal and in letter form that the condo is theirs...there is no telling how fucked up that place is now after sitting 16 months with the utilities off...