Complaints about mortgages, credit cards and other financial products are still rising at the Consumer Financial Protection Bureau.
CFPB Director Richard Cordray will tell the Senate Banking Committee Thursday the bureau received nearly 72,300 such complaints as of Sept. 3.
That’s up more than 30% from 55,300 reported through June.
Nearly half of these complaints concern mortgages.
“The pace of complaints has been increasing over the past year,” Cordray said in his prepared written testimony.
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The Royal Bank of Canada ($56.77 -0.59%) priced the first-ever covered bond backed by mortgages for U.S. investors.
The $2.5 billion offering carries a coupon of 1.2%, according to a bank spokesperson.
RBC received a “no-action” letter from the Securities and Exchange Commission in May allowing it to register its covered bond program with the agency.
The bank previously could, but the RBC covered bond guarantor, which will guarantee payments of interest and principal on the offering, previously could not, which is why a “no-action” letter was needed.
New York state Attorney General Eric Schneiderman’s probe of tax practices at private-equity firms is based on information from a whistleblower, according to a person familiar with the matter.
The information came from someone who approached Mr. Schneiderman’s office between roughly nine months and a year ago, this person said. Under the state’s False Claims Act, the attorney general can investigate alleged fraud against the state based on a whistleblower’s allegations.
The ongoing probe is examining whether partners at private-equity firms changed management fees into investment income to delay and pay less taxes—or avoid taxes altogether. Some private-equity firms use so-called management-fee conversions, while other firms avoid them.
If Mr. Schneiderman files a lawsuit and wins, defendants could be liable for damages of as much as three times the taxes owed. It isn’t clear when he will decide whether or not to proceed with a lawsuit.
At least two other whistleblower claims related to management-fee conversions have been filed with the Internal Revenue Service, which has the authority to pay whistleblowers up to 30% of proceeds collected in large cases. Such whistleblower cases usually take four to seven years to resolve.
(CN) – Two U.S. banks must turn over $364,500 to benefit terrorist victims trying to collect on a $591 million judgment against Iran, a federal judge ruled.
Before the judgment holders can collect, however, the court in Washington said it will first consider third-party interpleader claims so that the banks can protect themselves from multiple claims on the same funds.
“This court is under no illusions that the path ahead will be much easier for victims than it has been in the past,” Chief U.S. District Judge Royce Lamberth wrote.
He noted that the relatively small assets at stake represent less than one-tenth of 1 percent of the funds to which the plaintiffs are entitled under the Foreign Sovereign Immunities Act (FSIA).
“This tiny sum is dwarfed by even greater magnitudes when compared to the endless suffering of these victims,” Lamberth wrote.
Iran owes this group more than half a billion dollars for the 1996 bombing of Khobar Towers, a U.S. Air Force housing complex in Dhahran, Saudi Arabia. Hundreds died in the Hezbollah attack, which Iran had sponsored, and 19 military personnel were killed.
The current case against Bank of America and Wells Fargo represents the plaintiffs’ second phase of “the often-frustrating and always-arduous path shared by countless victims of state-sponsored terrorism attempting to enforce FSIA judgments,” Lamberth wrote.
Read more from Courthouse News.
Here is the court document.
Translated in English:
The Treasury launched Monday a syndicated issue (through a direct agreement with banks) to raise this amount through six-month bills and bonds at seven and eight years. The operation, which spend maximum capacity of FROB 9 to 15 billion euros, was included in a decree adopted by the government in February but had hitherto not been launched.
A client of Wellington foreclosure defense attorney Malcom Harrison may have cringed when he saw the Bank of America envelope in his mailbox. Instead, he’s more than half-a-million dollars out of debt.
The company, as part of the $25 billion agreement with the state attorneys general, is cancelling $570,100 in second mortgage debt the homeowner owed.
“You are approved for a full principal forgiveness of your Home Equity Account,” the Sept. 8 letter says in bold print.
Although the homeowner’s foreclosure will continue on the first mortgage, the second account will be reported as paid and closed, according to the letter.
I have written before about my opinions regarding the “safe harbors” in the bankruptcy code. These are the provisions that exempt derivatives and repo contracts from the automatic stay, the prohibition on termination of contracts with the debtor, the prohibition on constructively fraudulent transfers and the prohibition on obtaining preferential treatment on the eve of bankruptcy.
In general, I think the current safe harbors are too broad and amount to little more than a subsidy to the derivatives industry. Similar provisions protect “securities contracts,” and open up the argument that any transaction that occurs in the general vicinity of a broker-dealer is immune from the normal rules of bankruptcy.
Maybe Congress wants to subsidize the industry, but it probably should stop pretending that these provisions are vital to protect mom, apple pie and the American economy from systemic risk. You could do that with narrower provisions, as I have shown.
My latest concern with regard to the safe harbors is not so much the statutory provisions, but the role that courts have come to play in expanding the provisions beyond their already broad statutory language.