The SEC lawsuit alleges that the House staffer, Brian Sutter, spoke with a lobbyist — identifiedby the Journal as Mark Hayes, who happens to be a former aide to Grassley — on the day of the leak. The suit alleges that Sutter was in touch with Hayes by both email and phone and that they discussed the upcoming Medicare policy change. Hayes then allegedly gave the information to a research firm, which distributed the flash that set off the trading, according to the SEC. A 2012 law, the Stop Trading on Congressional Knowledge Act, prohibits government officials from disclosing non-public information that could affect stock prices, the Wall Street Journal reported.
Daily Archives: June 25, 2014
LinkJP Morgan Chase Accused of Massive False Claims
JP Morgan Chase Accused of Massive False Claims
COLUMBIA, S.C. (CN) – J.P. Morgan Chase Bank falsely claimed that it had forgiven thousands of consumer mortgage debts that the bank already had sold, to try to shirk its responsibility to a consumer-relief settlement with Uncle Sam, the United States and 19 states claim in a recently unsealed year-old case.
The federal government, 19 states and the District of Columbia sued J.P. Morgan in Federal Court under the False Claims Act on May 6, 2013, claiming the bank got credit without providing consumer relief.
The relator, Laurence Schneider, claims he bought thousands of mortgages from J.P. Morgan before the bank sent letters to those consumers, claiming that their debts had been forgiven.
The complaint cites a consent judgment entered against J.P. Morgan after the government’s 2012 complaint against the banking industry for fraudulent and unfair mortgage practices “which cost consumers, the federal government, and states billions of dollars.”
The banks settled in April 2012, and part of the terms of that settlement was J.P. Morgan had to dish out $4 billion in consumer relief in the form of loan forgiveness and refinancing.
According to the complaint, the bank gets credits toward its obligation by forgiving and modifying loans.
FHFA-OIG: FHFA should sue over force-placed insurance practices
FHFA-OIG: FHFA should sue over force-placed insurance practices
{Update 1: Post updated with a statement from Congresswoman Maxine Waters}
Over the last few years, financial regulators from all over the country have questioned the cost of force-placed (or lender-placed) insurance policies. Now, the Federal Housing Finance Agency’s Office of the Inspector General is suggesting that the FHFA sue its servicers and lender-placed insurance providers because Fannie Mae and Freddie Mac have suffered “considerable financial harm” in the LPI market.
LPI exists because Fannie Mae and Freddie Mac require their borrowers to maintain hazard insurance for their homes. “The insurance safeguards the value of the homes in the event of a fire or other covered incident, thereby preserving the Enterprises’ interests in them,” the FHFA-OIG said in a report.
Dave Brat Who Beat Eric Cantor Fudges the ‘Blame Fannie and Freddie’ Narrative
Editor’s note: This post originally appeared in National Mortgage News.
For an economics professor who has made the causes of the housing collapse a central issue in his political campaign, David Brat sure doesn’t sweat the details.
During the run-up to his surprise victory against House Majority Leader Eric Cantor in the Virginia Republican primary, Brat repeatedly blamed the 2008 crisis on Fannie Mae and Freddie Mac. That’s a well-known, if hotly debated, interpretation of history.
But Brat exaggerates the already-disputed data of the American Enterprise Institute purporting to show the government-sponsored enterprises’ culpability for the collapse. He also appears to miss the distinction between lenders that originate mortgages and secondary market participants like Fannie and Freddie.
Brat has claimed many times on the campaign trail that the GSEs were responsible for the overwhelming majority of subprime originations during the housing bubble. He typically makes this assertion using generic terms like “made” or “went through” to describe the GSEs’ role in mortgage lending.
“Fannie and Freddie made two-thirds of all subprime mortgages. That is not a free market institution,” he said in a Fox News interview the evening of the primary election. “That entity, along with the Fed printing too much money back in ’03 and ’04, caused the housing collapse.”
In a campaign speech, Brat suggested that the GSEs had completely disintermediated the banking industry by granting loans directly to borrowers (which would mean that every lender’s nightmare from the late 1990s had come true).
“The recent financial crisis, where did it start? In the housing market. We all know basically, probably the primary cause is located in Fannie and Freddie,” he said. “American Enterprise Institute estimates 70% of all subprime loans went through Fannie and Freddie. Instead of who? Instead of through your banker. So we’re putting bankers out of business. Bankers aren’t doing banking. In the past, bankers actually had to check your credit if you wanted a mortgage. Today, they don’t and Fannie and Freddie, they just say ‘here, here’s a mortgage.'”
Obviously, bankers still check applicants’ credit, even when they plan to sell the mortgage to Fannie or Freddie, which do not originate loans and must acquire them from banks and other lenders.
Brat’s campaign did not respond to requests for comment. But at a March campaign appearance, Brat also discounted banks’ role in the origination process.
“Seventy percent of all subprime loans didn’t go through bankers,” he said. “Bankers, their job is to do risk. Fannie and Freddie, is their job to do risk? Or to put the risk on your back?”
Brat is by no means the first political candidate to misconstrue Fannie and Freddie’s role in the mortgage industry. However, the murky wording of his remarks contrasts with Brat’s claims that he was driven to run for office because of the government’s handling of the financial crisis.
“What motivated the race for me was after the financial crisis, right, we had Fannie and Freddie collapse, the housing market, then the financial sector tanks,” he has said. “And I thought surely our political leaders now — you know, we’re on our knees economically. We’ll learn some lessons and get it right, and they didn’t. We’re still in roughly the same mess.”
Detroit water department to begin payment aid program after rate hikes, UN complaint
Detroit water department to begin payment aid program after rate hikes, UN complaint
What a mess in Detroit… FYI, according to the Free Press, the average Detroit water bill is now $75 a month — much higher than the nation’s average rate of about $40. For the record, I have never paid a $40 water bill and never will pay a $75 a month water bill especially in Detroit. That’s insane.
DETROIT, MI — An $800,000 program to help low-income Detroiters pay their water bills will be put in place in July after services were cut off from some residents in recent months and complaints were made to a United Nations representative, officials said Tuesday.
With about 90,000 city residents and businesses behind on their water bills, the Detroit Water and Sewerage Department in March began more aggressively collecting debt.
In May, about 46,000 notices were delivered to non-paying customers and water was cut off to about 4,500 of them, said DWSD spokesman Gregory Eno.
With 24 hours of the shutoffs, 2,700 of them paid or made arrangements to make payments and had services restored, Eno said.
“This is not an effort to shut peoples water off,” he said. “The effort is to collect that debt and get folks to enter into payment arrangements… DWSD is basically trying to put a dent into the bad debt, i.e. delinquent bills.”
Last week, the Michigan Welfare Rights Organization, the Detroit People’s Water Board and the Canada-based Blue Planet Project sent a letter to Catarina de Albuquerque, special rapporteur on the right to safe drinking water and sanitation for the United Nations’ Office of the High Commissioner for Human Rights.
The letter expressed outrage over the water cutoffs and called the collection effort a “violation of the human right to water and sanitation in the City of Detroit.”
Sen Grassley’s “Columbo” hunt for an Obama insider trading scandal backfires as SEC is investigating House Committee
lol Well, Chuckles, you should expand your inside trading scandal hunt in your own backyard…
Deutsche Bank Said to Lose 26 Junior Bankers in Asia This Year
Deutsche Bank Said to Lose 26 Junior Bankers in Asia This Year
Deutsche Bank AG (DBK) lost about 26 junior bankers in Hong Kong over the past four months, the biggest number of such departures from the firm in Asia in at least five years, two people with knowledge of the matter said.
The employees, including four directors and four vice presidents, began leaving voluntarily in late February after receiving their bonuses, the people said, asking not to be named because the matter is private. The departures came as Deutsche Bank added nine managing directors over the past 12 months in Asia, said Michael West, a Hong Kong-based spokesman.
“WEASEL FARGO” **WHACKED** WHILE TRYING A RAZZLE DAZZLE TWO STEP BACKPEDAL || EXCELLENT ORDER USDC SC – HARLIN V. WELLS FARGO – WF’S CLAIM THAT NAT’L MTG SETTLEMENT PRECLUDES INDEPENDENT STATE CONSUMER CLAIMS … DENIED
IN THE UNITED STATES DISTRICT COURT DISTRICT OF SOUTH CAROLINA COLUMBIA DIVISION EMILY M. HARLIN, Plaintiff vs. WELLS FARGO BANK, NA, Defendant
House Passes Bill To Aid Koch Brothers, Deregulate Wall Street
House Passes Bill To Aid Koch Brothers, Deregulate Wall Street
Once again Congress is stripping away the Dodd-Frank bill. The bill is far from perfect and the bill needs to be strengthen that need to add regulation on derivatives.
WASHINGTON — The U.S. House of Representatives on Tuesday passed a financial deregulation package that would benefit the Koch brothers and the nation’s largest banks by a vote of 265-143.
The legislation would significantly weaken elements of the 2010 Dodd-Frank financial reform law dealing with derivatives — the complex products at the heart of the 2008 meltdown. Many components of the bill approved Tuesday had previously passed the House with bipartisan support. However, Democratic backing had been weakest on the most controversial measure, which allows U.S. firms to skirt domestic regulations on some derivatives by conducting trades through offshore affiliates in other major financial centers.
Republicans were almost uniform in their support, with Rep. Walter Jones (N.C.) the lone GOP holdout. Democratic opposition was broad, with only 46 Democrats voting in support — a marked change from several recent House votes on Wall Street deregulation that have drawn substantial backing from dozens, and in some cases an overwhelming majority, of House Democrats. The White House issued a formal statement last week saying that it “strongly opposes” the legislation that passed Tuesday.
The bill includes several separate deregulatory measures sought by the largest Wall Street banks and the Koch brothers, who control significant financial and energy derivatives operations. Americans for Financial Reform, the premier policy analysis organization among bank watchdogs, advocated strongly against the bill alongside consumer groups and the AFL-CIO.
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Justice League 