Daily Archives: June 4, 2012

Mich. Supreme Court to review foreclosure case against JPMorgan Chase

LANSING, Mich. (Legal Newsline) – The Michigan Supreme Court, in an order last month, said it will hear an appeal by one of the nation’s largest mortgage servicers in a case over a state foreclosure law.

In January, the state Court of Appeals ruled unanimously in favor of plaintiffs Euihyung Kim and In Sook Kim.

The husband and wife sued JPMorgan Chase Bank N.A. in November 2009 seeking, among other relief, to set aside a sheriff’s sale of their home.

When the plaintiffs defaulted on a $615,000 loan from Washington Mutual Bank to refinance their home, JPMorgan Chase sought to foreclose by advertisement.

In June 2009, the mortgage servicer purchased the property at a sheriff’s sale for $218,000.

The appeals court ruled that JPMorgan Chase was not authorized to proceed with the sale under Michigan’s foreclosure by advertisement statute.

The defendant, it said, failed to record its mortgage interest before the sale as required by the law.

Soon after the court’s ruling, in February, JPMorgan Chase sought review by the state’s high court.

In a one-page order filed May 9, the Court granted JPMorgan Chase’s application.

Check out the rest here…

MF Global Trustee May Pursue Claims Against Jon Corzine, Could Sue JP Morgan

Trustee Report MF Globalhttp://www.scribd.com/embeds/95867340/content?start_page=1&view_mode=list

Merrill Lynch Losses Were Withheld Before Bank of America Deal

Days before Bank of America shareholders approved the bank’s $50 billion purchase of Merrill Lynch in December 2008, top bank executives were advised that losses at the investment firm would most likely hammer the combined companies’ earnings in the years to come. But shareholders were not told about the looming losses, which would prompt a second taxpayer bailout of $20 billion, leaving them instead to rely on rosier projections from the bank that the deal would make money relatively soon after it was completed.

What Bank of America’s top executives, including its chief executive then, Kenneth D. Lewis, knew about Merrill’s vast mortgage losses and when they knew it emerged in court documents filed Sunday evening in a shareholder lawsuit being heard in Federal District Court in Manhattan.

The disclosure, coming to light in private litigation, is likely to reignite concerns that federal regulators and prosecutors have not worked hard enough to hold key executives accountable for their actions during the financial crisis.

The filing in the shareholder suit included sworn testimony from Mr. Lewis in which he concedes that before Bank of America stockholders voted to approve the deal he had received loss estimates relating to the Merrill deal that were far greater than reflected in the figures that had appeared in the proxy documents filed with regulators. Shareholders rely on statements made in proxy filings to decide whether to approve transactions their companies have proposed, and companies must disclose all facts that could be meaningful for shareholders trying to decide how to vote on a deal.

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JPMorgan Was Warned About Lax Risk Controls More Than A Year Ago

A small group of shareholder advocates delivered an urgent message to top executives at JPMorgan Chase more than a year ago: the bank’s risk controls needed to be improved.

JPMorgan officials dismissed the warning from the CtW Investment Group, the advocates, who also cautioned bank officials that the company had fallen behind the risk-management practices of its peers.

Now, after disclosing a $2 billion trading loss at JPMorgan in May and watching the bank’s market value drop by more than $25 billion, those officials are expected to follow one of the group’s recommendations, strengthening the board panel that oversees risk.

Still, that will not address weaknesses that critics say undermined the power of the bank’s chief risk officer. According to two former traders at the chief investment office and outside specialists, the chief risk officer was not focused on the huge credit market bets the chief investment office made that eventually went bad.

Read on.

Biloxi Buzz For Monday

Tiger Stuns With Brilliant Comeback

Horrific Plane Crash Kills All 153 Passengers On Board

State Makes Bold Bid To Privatize Public Schools

Former ‘Family Feud’ Host Dies At 79

Bank of America tries renting to distressed homeowners, about $40 less than their old mortgage

LOS ANGELES — Unable to qualify for modifications on Bank of America mortgages, a few of California’s most distressed homeowners are being offered one last chance to stay in their homes: Become renters instead.

Testing a mortgage-to-lease program in the Golden State, Bank of America sent 300 letters last week inviting borrowers without other options to apply. An additional 1,500 letters will go out in the next few weeks as the bank, which also is testing the program in Arizona, Nevada and New York, evaluates whether a national rollout is feasible.

Bank of America plans to sell the homes to investors. It typically would recoup far less than what’s owed but would come out far ahead compared with where it would be after evicting borrowers, making “cash for keys” payments to help them move and selling empty and often vandalized foreclosures in the troubled housing market.

Evicted homeowners tend to look for single-family homes to rent in their own neighborhoods anyway, so why not let them exchange the deed to the home for a lease, Bank of America executive Ron Sturzenegger said.

Read on.