Daily Archives: May 19, 2014

Credit Suisse Admits Guilt In Aiding US Citizens Evade Taxes – Live Eric Holder Press Conference

And of course, no jail time…

  • U.S. FILES CRIMINAL CASE AGAINST CREDIT SUISSE IN FEDERAL COURT
  • CREDIT SUISSE AGREES TO PLEAD GUILTY IN TAX CASE SAYS U.S
  • CREDIT SUISSE PLEA WOULD END THREE YEAR U.S. INVESTIGATION
  • U.S. ALLEGES CREDIT SUISSE AIDED U.S. CITIZENS IN TAX EVASION
  • Some details:

    • *CREDIT SUISSE SAID TO PAY $715 MILLION TO NEW YORK IN TAX CASE
    • *CREDIT SUISSE PAYMENT TO NEW YORK REGULATOR PART OF U.S. ACCORD
    • *CREDIT SUISSE NEW YORK AGREEMENT INCLUDES MONITOR, TERMINATIONS

As Reuters reported earlier,

 
 

Credit Suisse’s guilty plea to U.S. criminal charges is likely to be announced after the market closes on Monday, three sources said.

 

Under a settlement, Credit Suisse is expected to pay over $2 billion to U.S. authorities to resolve charges it helped Americans evade taxes. The Swiss bank has been in negotiations with the U.S. Department of Justice, the U.S. Federal Reserve, and the New York State Department of Financial Services.

 

Spokesmen for Credit Suisse and the New York State Department of Finance as well as a spokeswoman for the U.S. Federal Reserve all declined to comment. A representative from the Department of Justice was not immediately available for comment.

 

A criminal guilty plea would be unusual for a financial institution. Authorities have not often sought criminal convictions against a company, fearing the action would put the firm out of business and result in lost jobs for employees that had nothing to do with any crime.

 

The Wall Street Journal reported on Monday that Chief Executive Officer Brady Dougan and Chairman Urs Rohner will retain their jobs under the settlement, citing a source.

 

Last week, sources told Reuters the settlement was expected to be about $2.5 billion, with about $2 billion going to the U.S. government, while the New York’s Department of Financial Services potentially would get another $500 million or more. The bank feared that a bigger settlement would threaten its credit rating, a source said.

 

And remember – Holder told us there was no such thing as too big to jail…

Link

CFPB director: Student loans are killing the drive to buy homes

CFPB director: Student loans are killing the drive to buy homes

The director of the Consumer Financial Protection Bureaurolled into Boulder, Colo. with a important message backed by plenty of data.

Citing statistics from a Pew survey, the National Association of Realtors and even the CFPB itself, Richard Cordray said crushing student loan debt is significantly denting the drive to buy homes in young Americans.

“According to an analysis by the Federal Reserve Bank of New York, for the first time in at least a decade,” he told attendees at the Boulder Summer Conference on Consumer Financial Decision Making, “households with student loan debt are less likely to have a mortgage than those without student loan debt.”

(Check out some charts showing the ascent.)

Link

Big banks running scared of shareholders in annual meetings

Big banks running scared of shareholders in annual meetings

My Friday morning had just one item on the schedule: Goldman Sachs’ annual shareholders’ meeting. Expecting battles over pay, uncomfortable questions from investors and a ridiculous proposal or two, I trudged through a 30-minute snore-fest that should have come with a free cup of coffee.

The pay plan was quickly approved, all directors were reelected and not one question was asked of Chief Executive Lloyd Blankfein. Zero. The lack of fireworks may have had something to do with the fact that the meeting took place in Irving, Texas, 1,800 miles away from Goldman’s New York headquarters.

The move has become all-too-common following the financial crisis. Bank executives, who earned beatings from investors in the years following the collapse, are taking their shareholders’ meetings on the road. Four of the six largest U.S. banks hosted their annual meeting outside of their home state, in cities like St. Louis, San Antonio and Tampa.

Most say it’s an effort to meet a different pocket of investors, but the true reason is clear. They want to avoid picket lines and verbal assaults from shareholders and retail customers. Banks may continue their road shows because the plans are working incredibly well.

With five of the six meetings in the books, this season has offered minimal highlights. Like with Goldman, not one Morgan Stanley shareholder asked a question in a meeting that lasted just 20 minutes. Wells Fargo, which had to abruptly end its 2012 meeting early due to raucous clients protesting its foreclosure practices, moved the gathering to Texas this year. While they encountered some picketers, the scene didn’t come close to matching the saga that took place in its hometown of San Francisco two years earlier.

Link

Defunct Calif. Mortgage Co. Settles FHA Fraud Claims

Defunct Calif. Mortgage Co. Settles FHA Fraud Claims

Law360, New York (May 19, 2014, 2:53 PM ET) — A defunct California mortgage company on Friday agreed to a $1 million settlement with federal prosecutors of claims that it falsely certified that loans it made met guidelines for Federal Housing Administration insurance.

The company, Reunion Mortgage Inc. of Milpitas, California, allegedly provided false certification to the FHA that 12 loans that ultimately defaulted met standards set by the U.S. Department of Housing and Urban Development for FHA insurance between September 2007 and May 2012. Those loans ultimately defaulted, costing the FHA more than $1.63 million…

Link

Wells Fargo Hit With Class Action For Improper Credit Check

Wells Fargo Hit With Class Action For Improper Credit Check

Law360, Los Angeles (May 19, 2014, 4:54 PM ET) — A Pennsylvania woman filed a putative class action in federal court Monday, alleging Wells Fargo Bank NA illegally dinged her credit history when it ran an unauthorized credit check to open a credit card account she hadn’t asked for.

Lisa Signore seeks to represent a class of bank customers whose credit has been negatively affected by the bank’s running credit checks to sell the customers products they didn’t want, according to the complaint.

The bank incentivizes its employees to cross-sell customers on other Wells Fargo products,…

Link

Credit Suisse charged in U.S. with conspiring to help tax evaders

Credit Suisse charged in U.S. with conspiring to help tax evaders

The U.S. Justice Department on Monday criminally charged Credit Suisse AG and two of its units with conspiring to willfully help Americans evade taxes, according to a court filing.

A hearing at which Credit Suisse is expected to plead guilty is scheduled for 5:30 p.m. (2130 GMT) in federal court in Virginia.

Link

Possible life in prison for pot brownies?

Possible life in prison for pot brownies?

Updated: Thursday, May 15 2014, 10:21 PM CDT We’re learning more about the man facing five years to life in prison for allegedly making and selling pot brownies.  Police in Round Rock arrested Jacob Lavoro last month. He’s charged with a first degree felony.  Think that’s harsh?  Lavoro’s lawyer and family would agree with you. “It’s outrageous, it’s crazy! I don’t understand it” exclaimed Joe Lavoro.  He’s Jacob’s father.  He made the comment outside the courtroom after one of what could be many court appearances for Jacob.  “Five years to life?” he continued.  “I’m sorry, I’m a law abiding citizen.  I’m a conservative.  I love my country.  I’m a Vietnam veteran, but I’ll be damned … this is wrong, this is damn wrong!” Lavoro’s lawyer Jack Holmes agrees.  “I was outraged.  I’ve been doing this 22 years as a lawyer and I’ve got 10 years as a police officer and I’ve never seen anything like this before.” The former high school football player has a clean record.  His charge is so severe because the recipe includes hash oil.  The hash ingredient allows the state to use the sugar, cocoa, butter and other ingredients to determine the weight of the drugs. “They’ve weighed baked goods in this case” laughed Holmes.  “It ought to be a misdemeanor.” We reached out to the District Attorney to ask how they’re going to prosecute the case. Our call has not yet been returned.