Daily Archives: September 13, 2013

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Wells Fargo Suit Over City’s Mortgage Seizure Plan On Brink

Wells Fargo Suit Over City’s Mortgage Seizure Plan On Brink

Law360, San Francisco (September 12, 2013, 4:50 PM ET) — A California federal judge said Thursday he is inclined to dismiss a challenge by Wells Fargo Bank NA and Deutsche Bank AG to Richmond, Calif.’s controversial proposal to take underwater mortgages by eminent domain, saying he doesn’t think he can rule unless Richmond’s city council greenlights the plan.

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How A 1¢ Interest Payment Zombified My Bank Of America Account

How A 1¢ Interest Payment Zombified My Bank Of America Account

A few days ago, we shared the hilarious and pitiful one-cent check that a reader received after closing out his Bank of America money-market account and taking the funds elsewhere. This was a silly and annoying waste of paper and postage, but better than the alternative…having the account go zombie and run up a negative balance when it should have been long since dead.

 

That’s what reader Dessa says happened to her and her mom when they closed down their BoA accounts and took their money to a local credit union.

My mother and I had both had BoA accounts since long before it was BoA, both of us had had Seafirst Bank accounts. However, when they were planning on starting their “monthly fee on having/using debit cards” and other crap, we decided to jump ship to [a local credit union].

 

In either October or November (I forget which), we went down to our local bank, told them we were closing our accounts, took out the money, and thought we were done with them. Until December came.

In December, we both got bank statements from BoA. We figured these were just because we’d closed mid-period, so it would be a final confirmation that the accounts were closed. Except there wasn’t a $0 balance. There was a -$4.99 balance.

It turns out, that because we didn’t close the account right at the end of the period, we got our 1¢ interest. Which apparently kept the accounts open. And, since that meant the accounts had under the minimum balance for free checking, we therefore were charged the $5 fee for the accounts, resulting in us owing $4.99.

Luckily for us, going into the bank branch, the banker helping us saw what happened, credited us for the fees, wrote us out the 1¢ checks (this is apparently a requirement, because without that taken out, the account won’t be fully closed), and made SURE that the accounts were closed and that we’d never have to worry about it. And we haven’t.

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Regulators Warn Banks Not to Flout $25 Billion Foreclosure Deal

Regulators Warn Banks Not to Flout $25 Billion Foreclosure Deal

When the largest U.S. banks agreed to pay $25 billion last year to settle claims of abusive foreclosure practices, they promised to stop seizing homes from borrowers who had completed applications for mortgage help.

Now regulators say lenders may be flouting the spirit of the deal by repeatedly asking for additional paperwork from borrowers seeking loan modifications and then foreclosing while treating the applications as incomplete.

The Consumer Financial Protection Bureau and the court-appointed monitor of the 2012 foreclosure settlement are among those moving to tighten oversight of the process known as dual-tracking, when borrowers facing the loss of their homes are simultaneously negotiating changes in their loans. Mortgage servicers who violate the rules or the terms of the deal could face sanctions including fines of $1 million per infraction

List of SEC Enforcements Actions Published

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SEC Enforcement Actions Addressing Misconduct that Led To or Arose From teh Financial Crisis:

Concealed from investors risks, terms, and improper pricing
in CDOs and other complex structured products:

  • Citigroup – SEC charged Citigroup’s principal U.S. broker-dealer subsidiary with misleading investors about a $1 billion CDO tied to the housing market in which Citigroup bet against investors as the housing market showed signs of distress. The proposed settlement would require a payment of $285 million by Citigroup that would be returned to harmed investors. (10/19/11)
  • Commonwealth Advisors – SEC charged Walter A. Morales and his Baton Rouge-based firm with defrauding investors by hiding millions of dollars in losses suffered during the financial crisis from investments tied to residential mortgage-backed securities. (11/9/12)
  • Goldman Sachs – SEC charged the firm with defrauding investors by misstating and omitting key facts about a financial product tied to subprime mortgages as the U.S. housing market…

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Wells Fargo looks to sell $41 billion in mortgage servicing rights

Citing Bloomberg News, Seeking Alpha reported Thursday that Wells Fargo (WF) is looking to sell mortgage servicing rights on $41 billion loans. Seeking Alpha released a small brief on the deal:

Banks have been unloading mortgage servicing rights as new capital rules make them too expensive to hold. Specialty servicers like those mentioned above have been happy buyers. For Wells, the move would free up capital, as well as provide an opportunity to book profits to offset the big slowdown in its mortgage origination business.

Source: Seeking Alpha