Daily Archives: October 22, 2012

Metro taxpayers, left holding the bag, foot the bill as banks walk away from homes

Several counties across the state, including Washtenaw County, are dealing with a phenomenon of banks “walking away” from houses despite owing thousands in taxes, according to a Detroit Free Press report

Seventy-six percent of the 274 properties in tax foreclosure this year in Washtenaw County are those that banks have some sort of financial interest in, according to the Free Press.

Tax foreclosures often lead to chargebacks, which is when the treasurer cannot collect the taxes owed from the bank or owner and the communities are then charged. Chargebacks cost Washtenaw County about $1.5 million.

Read on.

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14 million would switch to another bank, according to a new report

Millions may ditch their current account when new regulations come into force next year which will speed up the switching process.

Currently it can take up to a month to switch bank accounts. But from September next year banks will be required to complete switches within seven days. This could herald one of the biggest shake-ups in the retailbanking industry, with almost one in three customers (29pc) saying it was likely that they would switch their primary bank account if the process were quicker and easier.

The survey, conducted by YouGov and the Henley Business School, found that almost four out of 10 (38pc) of bank customers had never switched their main current account, despite the fact that 65pc of customers said that banks were failing to improve their customer service.

This suggests that despite high levels of dissatisfaction, consumer apathy remains prevalent.

Read on.

Corzine, Banks Want to Close MF Global Fraud Lawsuit

Jon Corzine’s lawyers say allegations that he fraudulently ran MF Global Holdings Ltd make “no sense” and that a lawsuit seeking to hold him and others responsible for the futures brokerage’s
bankruptcy must be thrown out.

Corzine, former colleagues and several banks, including JPMorgan Chase & Co and Goldman Sachs Group Inc, filed papers on Friday night to dismiss investor litigation over MF Global’s collapse. The company’s Oct. 31, 2011, bankruptcy was Wall Street’s biggest meltdown since 2008.

Plaintiffs led by the Virginia Retirement System and the province of Alberta, Canada, have accused MF Global in the U.S. District Court in Manhattan of inflating its ability to manage risk, obscuring risks from a big bet on European sovereign debt and improperly accounting for deferred tax assets.

But lawyers for Corzine, MF Global’s former chairman and chief executive officer, said there was no securities fraud. They said the allegations merely suggested that Corzine mismanaged the company, was too optimistic, or failed to predict a liquidity squeeze prompted in part by credit rating downgrades.

Read more: http://www.foxbusiness.com/industries/2012/10/22/corzine-banks-want-to-close-mf-global-fraud-lawsuit/#ixzz2A36UUIW6

Law Firm’s Client Says It Cut A $6M ‘Secret’ Deal With Wells Fargo To Screw Plaintiffs

An employee suing Wells Fargo for allegedly failing to pay overtime wages is claiming her law firm settled the suit behind plaintiffs’ backs.

Mark Yablonovich’s firm allegedly signed a “secret” $6 million settlement with Wells Fargo on behalf of former employees without telling them and then tried to claim almost the entire sum of $6 million as legal fees, according to Courthouse News.

Now the lead plaintiff, Kendra Cutting, is suing Yablonovich’s firm on behalf of 600 people who worked for Wells Fargo.

The attorneys allegedly hid the existence of the class settlement for an entire 11 months during which it tried to get Wells Fargo to sign a secret agreement converting the entire settlement into legal fees, according to Courthouse News.

Because the settlement absolved Wells Fargo of the overtime claims, Yablonovich’s firm made it impossible for any of the 600 class members to seek any legal recourse, the suit states.

Read more: http://www.businessinsider.com/firm-accused-of-secret-wells-fargo-deal-2012-10#ixzz2A37UChOQ

Goldman Sachs Bonus System Corrupted in 2005, Ex- Employee Greg Smith Book Says

Goldman Sachs Group Inc. (GS) changed how it calculated year-end bonuses in 2005, corrupting a culture of teamwork that existed previously, according to a book published today by former employee Greg Smith.

Before 2005, the company determined workers’ annual awards“not just on how much business you’d brought in, but also on how good you were for the organization,” Smith, a former vice president, writes in “Why I Left Goldman Sachs: A Wall Street Story.”

“From 2005 until the present day, the system has become largely mathematical: you were paid a percentage of the amount of revenue next to your name,” a figure that could vary from 5 percent to 7 percent, wrote Smith, 33, without saying how he learned about such a change. “The problem with the new system was that people would now do anything they could — anything –to pump up the number next to their name.”

Read on.