Daily Archives: October 30, 2013


Japan investigates ‘gangster loans’ at top banks

Japan investigates ‘gangster loans’ at top banks

Japan’s financial watchdog is to investigate the country’s top three banks in the wake of a loans-to-mobsters scandal that has raised questions about corporate links with organised crime.

The country’s Financial Services Agency (FSA) will look at Mizuho’s business dealings as well as rivals Mitsubishi UFJ and Sumitomo Mitsui Banking Corp, an agency spokesman said, without giving further details.

Mizuho has been under fire since it emerged last month that it processed hundreds of loans worth about $2m (£1.2m) for the country’s yakuza crime syndicates, which are involved in activities ranging from prostitution and drugs to extortion and white-collar crime.


Dutch Bank Settles Case Over Libor Deceptions

Dutch Bank Settles Case Over Libor Deceptions

Updated, 8:37 p.m. | The Dutch lender Rabobank admitted on Tuesday to criminal wrongdoing by its employees and agreed to pay more than $1 billion in criminal and civil penalties to settle investigations by United States, British and other authorities into its role in setting global benchmark interest rates. Its chief executive stepped down immediately.

The bank is the fifth financial firm to settle accusations that its employees manipulated the London interbank offered rate, or Libor. The settlement with Rabobank is the second-largest agreement after the $1.5 billion penalty imposed onUBS related to the manipulation of benchmark rates, which help determine the borrowing costs for trillions of dollars of mortgages, business loans, credit cards and other financial products.

As part of the settlement, Rabobank, which started out as an agriculture cooperative in the Netherlands in the late 19th century and has become the country’s biggest lender, entered into a so-called deferred prosecution agreement, in which it will avoid criminal charges as long as it continues to cooperate with investigators and stays out of further trouble. Rabobank will pay a $325 million criminal penalty to the Justice Department and $475 million to the Commodity Futures Trading Commission, as well as $170 million to the Financial Conduct Authority in Britain and about $96 million to the Dutch authorities.


House to Vote on Derivatives Bill That Was Written by Citigroup Lobbyists

House to Vote on Derivatives Bill That Was Written by Citigroup Lobbyists

Later this week, the House of Representatives will be voting on a bipartisan bill to repeal financial bailout protections that Congress passed in 2010 as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The bill, H.R. 992 or the “Swaps Regulatory Improvement Act,” would severely limit the reach of Sec. 716 in Dodd-Frank, which requires banks that are eligible for Federal Deposit Insurance Corporation or Federal Reserve lending discounts to spin off their derivatives activities into separate corporate entities that would not be eligible for federal assistance.

According to the New York Times, lobbyists from Citigroup played a major role in the bill’s creation: “Citigroup’s recommendations were reflected in more than 70 lines of the House committee’s 85-line bill,” Eric Lipton and Ben Protess write. “Two crucial paragraphs, prepared by Citigroup in conjunction with other Wall Street banks, were copied nearly word for word. (Lawmakers changed two words to make them plural.)”

Read more: http://www.kitsapsun.com/news/2013/oct/29/house-to-vote-on-derivatives-bill-that-was-by/#ixzz2jB5lx3Rl


I-Team: Law firm mistake leaves couple without home

I-Team: Law firm mistake leaves couple without home


A little over a month ago, John and Ann Roach bought a foreclosed home near Indian Lake in South Kingstown.

In short order, they sold their home in Rumford.

The couple said at this point in their lives it was time for a change.

“We thought what a wonderful place to create memories with our grandchildren, the next generation. We were close to fishing, planning on kayaking, and getting a small boat,” Ann Roach said.

The Roaches’s closing on the foreclosed home was scheduled for Oct. 21, but then at the very last minute, it was called off.

“Sharon Steel, our Realtor, met with us last Friday and told us because Harmon Law had failed to provide proper notification of foreclosure, we’d be unable to obtain title insurance” Ann Roach said.

Harmon Law is a large firm located in Newton, Mass. It’s currently under investigation by state Attorney General Martha Coakley who is looking into unfair and deceptive acts on the part of the firm.

A slew of complaints exist against the firm, known as a “foreclosure mill.”

In the Roaches’s case, Harmon Law did publish a foreclosure notice in the Westerly Sun for the property at 45 Red Feather Trail.

But what the law firm apparently didn’t bother to check was the fact that the Westerly Sun moved its offices to Pawcatuck, Conn.

JPMorgan’s government settlement is on thin ice

According to The Wall Street Journal, part of JPMorgan Chase’s (JPM) multibillion-dollar deal is at risk of falling apart over a disagreement about the bank’s effort to be reimbursed by a government-controlled fund.

A draft agreement offered by the bank Sunday night has angered federal officials and raised new questions about the ability of the two sides to finalize what would be a record-setting pact, according to people familiar with the talks.

A key sticking point is whether J.P. Morgan or the Federal Deposit Insurance Corp. bears ultimate responsibility for liabilities linked to Washington Mutual, which J.P. Morgan acquired during the financial crisis, said people close to the talks. On Sunday night, lawyers for the bank also offered a proposed deal that could give the bank extra legal protection from criminal probes—something the Justice Department leadership isn’t willing to accept, these people said.

Source: WSJ

Ally reaches settlement with the FHFA, FDIC

Ally reaches settlement with the FHFA, FDIC

[Update 1: A previous version of this article suggested Ally settled for $170M. However, that figure refers to what the firm added to its loss reserves]

Ally Financial Inc. (ALLY) has reached a settlement with the Federal Housing Finance Agency and the Federal Deposit Insurance Corporation to resolve outstanding mortgage issues. The bank, which used to be over lenderResidential Capital, disclosed an additional $170 million contribution to its loss reserves in the third quarter.

Details of the settlement itself have yet to be released.

The settlements require pending litigation against Ally to be dismissed. Ally has been slowly diminishing its exposure to the mortgage lending space. The firm’s former mortgage division, ResCap, entered into bankruptcy reorganization in the wake of the financial crisis.