Daily Archives: September 26, 2012

Exclusive: British Bankers’ Association Calls For Rate-Fixing Fines

The Libor oversight body wants traders guilty of manipulation attempts to suffer stiffer penalties, Sky’s City Editor has learned.

Traders found guilty of attempting to manipulate the interbank borrowing rate Libor should be fined, publicly censured and struck off the City regulator’s approved persons register, according to the organisation which supervises the rate-setting process.

I have been leaked a copy of the blueprint submitted by the British Bankers’ Association (BBA) to a Government-backed inquiry aimed at restoring the integrity of the benchmark interest rate.

It recommends a sweeping overhaul of Libor including a “medium term transition to a new rate-setting process based on actual trade data”, ending the involvement of currencies such as Australian and Canadian dollars in the Libor system, and a streamlining of the rate-setting process for currencies including sterling, euros, yen and US dollars.

Read on.

RBS traders boasted of Libor ‘cartel’ just weeks before the bank was bailout by taxpayers

Royal Bank of Scotland traders boasted about operating a “cartel” to rig Libor just weeks before the bank was rescued at a cost of more than £40bn by the taxpayer.

Senior traders working for RBS’s investment banking arm openly discussed fixing the world’s key borrowing rate in the months running up to the bank’s collapse, according to legal documents cited by Bloomberg.

In one exchange in April 2008, Tan Chi Min, a former Singapore-based trader at RBS, messaged traders saying “Our six-month fixing moved the entire fixing, hahahah”.

Read on.

Flagstar Bank to face trial over mortgage servicing – U.S.Judge Rakoff

NEW YORK, Sept 26 (Reuters) – Flagstar Bank, the ninth-largest mortgage lender in the United States, must face trial next month over allegations that it breached contracts for financial guaranty insurance on nearly $1 billion in securities backed by home equity loans.

A federal judge in New York, expanding on an order he issued in February, wrote in an opinion issued on Tuesday that the plaintiff, Assured Guaranty Municipal Corp, had provided enough evidence to survive the bank’s motion to throw out the case.

Flagstar spokeswoman Susan Bergesen said the savings bank had a policy of declining to comment on pending litigation.

In his opinion, U.S. District Judge Jed Rakoff said he was skeptical that Assured Guaranty’s allegations of Flagstar’s failure to follow customary servicing practices amounted to gross negligence, misfeasance or bad faith. But the judge added: “The court finds that the plaintiff has presented enough evidence to survive summary judgment on this claim.”

The trial is scheduled to start on Oct. 9, he said.

Read on.

NY announces first-in-nation pro bono mandate for lawyers

NEW YORK, Sept 19 (Reuters) – The unveiling Wednesday of the details of a new rule making New York the first state to require aspiring lawyers to perform free legal work in order to be admitted to the bar has quieted concerns of law school administrators that it would be costly to implement.

The regulation, first proposed by Chief Judge Jonathan Lippman in May, requires law students to perform 50 hours of pro bono work between their first year of law school and the time they apply for a license.

Over the summer, officials from law schools across the country had worried that if existing programs like clinics and internships did not qualify, schools would be forced to hastily implement new ones, taxing limited resources.

But under the new rule, pro bono service is defined as providing “law-related” services to low-income people, non-profit organizations, civil rights groups or any government entity and allows such clinics to count toward the requirement, even though students typically receive academic credit for those programs.

“It’s much better than it could have been,” said the dean of Cornell Law School, Stewart Schwab.

Read on.

Federal court in Georgia says MERS has power under security deed

The Mortgage Electronic Registration Systems, or MERS, registry possesses the power to foreclose as long as it’s listed on the security deed as nominee for the original lender and any of the lender’s successors, a U.S. District Court Judge out of Atlanta ruled this week.

The case – Crutcher v. CitiMortgage – involves a common situation that occurs when the original lender sells a loan off to other banking institutions, naming the MERS registry as nominee for the lender and its successors.

Read on.

On a side note: In Georgia, lenders may foreclose on deeds of trusts or mortgages in default using either a judicial or non-judicial foreclosure process.

Calif. Gov. Signs Foreclosure Prevention Bills

California Gov. Jerry Brown on Tuesday signed three new laws that are part of the Homeowner Bill of Rights aimed at increasing prosecutions for mortgage-related crimes.

The laws give California’s Attorney General Kamala D. Harris the authority to impanel a statewide grand jury to investigate financial crimes, including mortgage fraud; extend from one year to three years the statute of limitations for prosecuting mortgage-related crimes; and give renters a guarantee to stay in a foreclosed property bought by new owners.

In July, Brown signed two of the most controversial parts of the Homeowner Bill of Rights that expands some of the requirements of the national mortgage settlement to all mortgage servicers in the state.

Read on.

The referee at the center of the football controversial call is a BofA vice president for small-business banking in California

lol Will the betting people in Las Vegas going to blame Bank of America?

Courtesy of American Banker. More from Zerohedge:

Lance Easley – previously at Wells Fargo, has worked at BofA since June 2011 – (we assume) moonlighting as a referee in the Santa Barbara area (officiating high school and junior college football and basketball games). Well done Lance, you have managed to move from the most-hated occupation (bankster) to the most-hated individual (outside of Seattle) in one weekend. Is it any wonder Small Business confidence and uncertainty is so high?