Monthly Archives: March 2014

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General Motors : Regulators Twice Failed to Open GM Probes

General Motors : Regulators Twice Failed to Open GM Probes

Congressional investigators looking into why General Motors Co. took nearly a decade to recall vehicles with faulty ignition switches said Sunday that federal regulators twice declined to open formal probes into complaints about the cars and that GM rejected a proposed fix for the problem in 2005 because it would have taken too long and cost too much.

The findings by staff for the House Energy and Commerce Committee offer new details about events leading up to GM’s recall of 2.6 million vehicles for ignition-switch defects now linked to 13 deaths.

Investigations by the House panel, a Senate committee, regulators and federal prosecutors are continuing. A memorandum produced by House investigators based on their review of evidence so far indicates that lawmakers will press both GM and the National Highway Traffic Safety Administration on why they missed several opportunities during the past decade to alert the public to the dangers posed by cars that could suddenly shut down, disabling air bags, power steering and power brakes.

GM declined to comment. The NHTSA said Sunday it “reviewed data from a number of sources in 2007, but the data we had available at the time did not warrant a formal investigation.” It added that it is “aggressively investigating” the recall and new information provided by GM.

Anita Hill documentary revisits sexual harrassment and gender inequality

Written by SP Biloxi

I had the opportunity to see Anita Hill documentary this weekend tat played in limited theaters. In 1991, Anita Hill,  a young law professor, testified that her former boss and then-Supreme Court nominee Clarence Thomas had sexually harassed her. Sexual harassment, during that time, was not opened topic to discuss. But, Ms. Hill’s testimony to the Senate committee provided a serious open dialogue to a topic and a need for change that is still an issue today 20 year later. The Senate Judiciary Committee which was an all white male committee, treated Ms. Hill as if she were on trial. One senator had referred to her a “scorned woman.” Clarence Thomas denied all charges that Ms. Hill accused Mr. Thomas of. But, what I walked away with from watching this documentary and reliving that hearing that I watched on TV is what about the other women that were not called in for testimony at the hearing that accused Mr. Thomas of inappropriate remarks and sexual harassment similar to Ms. Hill’s accusations?

The Senate never talked to Lillian McEwen who was a  former assistant U.S. attorney and Senate Judiciary Committee counsel  and who had dated Mr. Thomas for years.

From Washington Post:

She had worked on the Hill and was wary of entering the political cauldron of the hearings. She was never asked to testify, as then-Sen. Joe Biden (D-Del.), who headed the committee, limited witnesses to women who had a “professional relationship” with Thomas.

Now, she says that Thomas often said inappropriate things about women he met at work — and that she could have added her voice to the others, but didn’t.

And this:

Given that history, she said Hill’s long-ago description of Thomas’s behavior resonated with her.

“He was obsessed with porn,” she said of Thomas, who is now 63. “He would talk about what he had seen in magazines and films, if there was something worth noting.”

McEwen added that she had no problem with Thomas’s interests, although she found pornography to be “boring.”

According to McEwen, Thomas would also tell her about women he encountered at work. He was partial to women with large breasts, she said. In an instance at work, Thomas was so impressed that he asked one woman her bra size, McEwen recalled him telling her.

What about Angela Wright who worked as director of public affairs at the EEOC under Mr. Thomas? From Salon:

Upon learning of Hill’s claims, another former Thomas employee, Angela Wright, who had worked under him as director of public affairs at the EEOC, wrote a column — not meant for publication and intended only to show potential employers at a North Carolina newspaper that she could turn around a fast and topical piece — outlining the inappropriate behavior he’d exhibited toward her. Somehow, Judiciary Committee investigators learned of the column, contacted Wright, and convinced her to sit for a phone interview, during which she detailed a pattern of harassing behavior, including an instance in which Thomas asked her what her bra size was. She was subpoenaed by the committee and flew to Washington to testify in the nationally televised hearing; the basics of her claims were reported by media outlets at the time. Her testimony would have bolstered Hill’s case — a second female Thomas underling, one who had never met or worked with Hill, accusing him of the same conduct. But the committee never called Wright, and instead simply entered the transcript of her interview into its record on the eve of the final vote. The details of her interview were buried in press reports.

Or Rose Jourdain?

Rose Jourdain, who had worked with Wright under Thomas, told committee investigators that Wright had spoken to her while they worked together about their boss’ conduct. As later reported by Graves, “Though her recollections had differed slightly from Wright’s, Jourdain … had confirmed the basic elements of Wright’s account, including Wright’s anger at Thomas for what Wright had said was overtly sexist behavior. Jourdain had mentioned “comments [Wright] told me that he was making concerning her figure, her body, her breasts, her legs, how she looked in certain suits and dresses.”

Or Sukari Hardnett?

In a letter to the committee, a former aide to Thomas at the EEOC, Sukari Hardnett, wrote that many black women at the agency felt they were “an object of special interest” to their boss. “If you were young, black, female and reasonably attractive,” her letter read, “you knew full well you were being inspected and auditioned as a female.”

Lastly, statements from Mr. Thomas’ acquaintances from his college years?

In November ’94, three years after Thomas was confirmed, Wall Street Journal reporters Jill Abramson and Jane Mayer released a book, “Strange Justice,” which brought new information about the Thomas/Hill confrontation to light. As a Washington Post article described it:

“Strange Justice” uses statements from Thomas’s friends and associates to undermine Thomas’s testimony that he never talked dirty with Hill. The authors, after interviewing acquaintances as far back as his college years at Holy Cross, report that he often recounted sexually explicit films in lurid detail. Kaye Savage, a former colleague, reports that the walls of his bachelor apartment were covered with Playboy nude centerfolds. The owner of a video store near the EEOC said Thomas was a regular customer for pornographic movies.”

Unfortunately, none of the women were given an opportunity to testify. There are people who don’t believe Anita Hill’s testimony today but believe Mr. Thomas or vice versa.( On a side note: from the documentary, Ms. Hill showed file cabinets in her basement of her home full of letters throughout the years from approximately 25,000 + people who shared their support and stories. And many of the letters are from men.)  But, rest assured the goal of the Senate Committee was to target one woman for humiliation on national television as a warning to other women who wanted to speak out about employment harassment. Has anything changed in Washington? You can only answer that question. After all, remember Sandra Fluke, an attorney and women’s right activist who was refused by Republican members of  House Oversight and Government Reform Committee to allow her to testify on the importance of requiring insurance plans to cover birth control during a discussion on whether medical insurance should have a contraception mandate.  Republican members of  House Oversight and Government Reform Committee then replace Sandra Fluke with men from conservative religious organizations to testify. Anita Hill documentary certainly is perfect timing to discuss and end the gender inequality in this country and the documentary is not just about setting the record of who was telling the truth in the 1991 Senate hearing. Ms. Hill’s message simply is she is helping women find their voices. She found her voice and she is not afraid to use it.

Office Of Outgoing JPMorgan Asia CEO Raided By Hong Kong’s Commission Against Corruption

Not a good year for JP Morgan.

From Bloomberg:

 
 

The Independent Commission Against Corruption seized computer records and documents after searching the office of Fang Fang, the company’s outgoing chief executive officer for China investment banking, said the people, who asked not to be identified because the investigation is confidential.

 

“We will not comment on individual cases,” Alan Tse, an ICAC spokesman, said by phone yesterday. Marie Cheung, a Hong Kong spokeswoman for JPMorgan, declined to comment on the ICAC search.

 

The New York-based bank announced Fang’s resignation March 24. His departure comes amid an investigation into JPMorgan (JPM)’s Asian hiring practices. U.S. authorities are examining whether the bank employed people in Asia so that their relatives in government would steer business to the bank, people with knowledge of the probes have said.

 

The banker joined JPMorgan in August 2001 and became head of the firm’s China investment-banking unit in 2007 and was made vice chairman for Asia investment banking in 2009. Prior to joining the bank, Fang worked as a vice president of Beijing Enterprises Holdings Ltd., an investment company controlled by the Beijing government.

JPMorgan, the world’s biggest investment bank by fees last year, said in August that the U.S.’s Securities and Exchange Commission had sought information on its employment practices and client relationships in Hong Kong. U.S. prosecutors were given e-mails written by Fang in which the banker supported the hiring of China Everbright Group Chairman Tang Shuangning’s son, the Wall Street Journal reported March 24. Those e-mails also highlighted the potential for doing business with China’s state-backed conglomerate while Fang hasn’t been accused of any wrongdoing, the paper said.

 

The probes have posed hurdles to JPMorgan’s involvement in at least two recent investment-banking transactions. The bank decided to quit China Everbright Bank Co.’s Hong Kong share sale in November because the investigation delayed an internal approval process, according to two people with knowledge of the matter. The $3 billion deal was the largest first-time offering by any company in Hong Kong last year.

Class Action Complaint filed against Northwest Trustee Services

H/T from Deadlyclear.com:

Plaintiffs bring this action as a Class Action pursuant to CR 23 on behalf of all persons in the state of Washington who received defective Notices of Default (as specified below) from Northwest Trustee Services, Inc. (NWTS).

 

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“Nail Gun Suicide” Banker’s Firm Probed Over Missing Millions

“Nail Gun Suicide” Banker’s Firm Probed Over Missing Millions

State prosecutors launched a criminal investigation and a grand jury into bankrupt American Title Services just days after its CEO killed himself with a nail gun, according to federal court records.

Meanwhile, the title insurance company for which American Title was writing policies said more than $2 million is missing from escrow accounts the Greenwood Village company maintained on real estate closings.

American Title has filed for bankruptcy protection, largely because all of its records have been seized and it’s unable to do business. Investigators from the Colorado Attorney General’s office and Title Resources Guaranty Company, the company for which American Title wrote policies, seized the documents shortly after CEO Richard Talley killed himself at his Aurora home on Feb. 4.

Records from two separate cases in U.S. District Court — a lawsuit and a bankruptcy — suggest the seemingly successful title business with several branches around the state had financial problems.

A spokeswoman for Attorney General John Suthers’ office would not say how broadly investigators are looking into American Title’s affairs or whether the inquiry centers solely on Talley.

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MORTGAGE SERVICING SHIFTS TO NONBANK FIRMS

MORTGAGE SERVICING SHIFTS TO NONBANK FIRMS

Increasingly, the $10 trillion mortgage servicing industry is shifting from banks to nonbank  firms such as hedge funds, as federal and state regulators increase their  scrutiny — and fines — on the banking industry.

For years, banks such as Bank of America, JPMorgan Chase, Wells Fargo & Co. and  Ally Financial have been selling mortgage servicing rights to nonbank companies like Carrington Mortgage Services, Nationstar Mortgage Holding and Ocwen Financial Corp.

Last year, over $1 trillion of home loan servicing rights were transferred from traditional banks to nonbank companies, reports The  Wall Street Journal.

The  home loan servicing business is lucrative. Nonbank mortgage servicers make  money by collecting a fee for handling billing and payment collections from borrowers. Banks and loan investors pay the nonbank mortgage servicers a percentage of the billions collected each month.

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Wells Fargo wins second part of securities lending case

Wells Fargo wins second part of securities lending case

The pension plan for Blue Cross Blue Shield of Minnesota, along with other pension funds, has lost a legal battle with Wells Fargo & Co. over tens of millions of dollars the funds lost in the bank’s former securities lending program.

The San Francisco-based bank did not breach its fiduciary duties to the pension funds, U.S. District Judge Donovan Frank said in an order filed Monday.

However, he explained in the 12-page order that he was “constrained” by law to adopt the decision a jury reached last August in the case, which had two parts. The jury last August focused on claims by just six of 13 institutional investors that sued Wells Fargo in 2011, those not covered by the federal Employee Retirement Income Security Act (ERISA). The jury decided that Wells Fargo did not breach its fiduciary duty to those six plaintiffs with its investment decisions.

Monday’s order covers the remaining seven pension funds, including Blue Cross Blue Shield’s, that fall under ERISA. Frank heard those claims separately, and determined he was legally bound to accept the jury verdict for them.