- Jamie Dimon’s worst fears for the banking industry realized with Capital One data hack
- Diary of a Deutsche Bank stock trader: The day I lost my job
- CFPB claims debt collection firm Forster & Garbus robo-sued thousands on behalf of Citibank, Discover, others
- Countrywide founder Angelo Mozilo says ‘for some unknown reason, I got blamed’ for subprime crisis
- New York launches its own CFPB
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Daily Archives: August 11, 2014
Zephyr Teachout has beaten back Gov. Cuomo’s attempt to kick her off the Sept. 9 Democratic primary ballot.
A Brooklyn State Supreme Court judge ruled Monday that the longshot candidate meets the state Constitution’s five-year residency requirement for anyone seeking to become governor, handing a defeat to Cuomo’s legal team that charged she did not live in New York long enough.
“New York courts have recognized that, in our modern mobile society, an individual can have more than one bona fide residence,” Judge Edgar Walker wrote in the ruling.
“It is evident that since June 2009, Ms. Teachout has clearly ‘lived’ in New York, as that term is commonly understood, in order to pursue her career as a Fordham professor.”
Teachout, in a statement, hailed Walker’s decision.
“Today we beat the Governor and his old boys club in court,” Teachout said
“His two attempts to knock me off the ballot have failed — first by challenging my petition signatures, and second by challenging my residency. We won Rounds 1 and 2. Now it’s time for Round 3: a debate. New York Democrats deserve a debate between Andrew Cuomo and myself about the issues that real New Yorkers care about: schools, fracking, corruption and building a fair and strong economy.”
Teachout added: “There wasn’t supposed to be a primary in Andrew Cuomo’s New York. Game on.”
Cuomo’s campaign did not immediately comment.
UPDATED – Cuomo lawyer Martin Connor says the governor will appeal.
TAMPA, Fla. (CN) – Attorneys general from two states sued five law firms in Federal Court, claiming they took millions of dollars in upfront fees for putative mass-joinder lawsuits for homeowners facing foreclosure, but never provided services.
The attorneys general say in the 39-page lawsuit that the U.S. foreclosure crisis led to a drastic rise in predatory practices by firms like the defendants, who “made money by charging distressed homeowners upfront fees on the promise that they could obtain mortgage modifications for these homeowners, often providing little or no actual assistance.”
Despite federal and state regulations curbing the activity, the AGs say “veterans of such scams have shifted to selling homeowners’ participation in so-called ‘mass-joinder’ lawsuits. Homeowners are led to believe that they will be represented by real law firms and that joining a mass-joinder lawsuit will help them avoid foreclosure, reduce their interest rates and loan balances, and entitle them to monetary compensation.”
The prosecutors claim the defendants “misled thousands of homeowners nationwide and … pocketed at least $4.7 million” by “sending misleading mailers that resemble class action notices to consumers notifying them that they are a potential plaintiff in a ‘national’ lawsuit against their particular mortgage lender or service for ‘multiple claims of fraud and misrepresentation.’
“The mailers create a sense of urgency for consumers to enroll by a certain date or risk exclusion and induce consumers into believing that by ‘opting-in’ they will receive a reduced interest rate, lower monthly payment, principal reduction, loan forgiveness, and monetary damages.”
Here are the defendants – the Resolution Law Group and Berger Law Group together are called the RLB/BLG Enterprise:
Berger Law Group, P.A., of Tampa;
Ian Berger, of Tampa, an attorney, president of the Berger Law Group, and “the Enterprise’s newest front man;”
Litigation Law LLC, an administratively dissolved Florida LLC founded by defendant DiGirolamo in May 2011, which operated out of Pinellas Park, Fla.;
Gary DiGirolamo, a nonattorney, of Mission Viejo, Calif., “the RLB/BLG enterprise’s most senior manager;”
The Resolution Law Group, of Greenwich, Conn. and Tampa, Fla., a Connecticut corporation formed by defendant Broderick in November 2011;
Robert Geoffrey Broderick, of San Clemente, Calif., an attorney licensed in Connecticut, president of The Resolution Law Group, and “the Enterprise’s front man;”
The Resolution Law Center, of Tampa, a Florida LLC former by defendant Friedman in December 2011;
David Friedman, of Tampa, a nonattorney who “manages and controls the RLG/BLG Enterprise’s sales operation and is the president of defendant Resolution Law Center.”
Private equity firms are carving out a more prominent position in the financial market as investment banking fees continue to rise, an article in Business Insider said.
According to the article, fees paid by private equity firms now make up 32% of U.S. investment banking fees. That’s $6.5 billion out of $20.4 billion in total banking fees.
These firms have become investment banks’ largest clients as they reap the benefits from the last buyout frenzy in 2007, now taking large companies public. Low interest rates from the Fed have also helped firms refinance previous deals.
The Blackstone Group was Wall Street’s highest fee-payer last year at $880 million, the article stated. It is also one of the largest players in rental
Source: Business Insider
Improper foreclosures conducted by some financial institutions are part of the legacy of the left by the financial crisis. A foreclosure that is not conducted in accordance to state law leaves the new purchaser of the property in the impossible position of not having marketable title when they go to sell it again.
It’s a catch-22. On one hand individuals who have had their homes improperly foreclosed upon need to have a process to challenge the seizure and regain the property. On the other, there is a compelling interest that title to properties be free of encumbrances and that buyers of foreclosed properties be able to refinance or to confidently offer their properties on the open market should they decide to sell them at some point.
The Massachusetts legislature is seeking to rectify the dilemma with the passage of a bill that will limit the length of time that owners that have been foreclosed upon have to challenge the process in the courts to regain their homes. It does not limit their ability to sue the financial institution for monetary damages.
Opponents of the law are calling on Governor Deval Patrick to step in.
New England Conference of the NAACP President Juan Cofield, Boston City Councilor Tito Jackson, and others community leaders wrote a letter to the Governor requesting that he veto or amend the foreclosure bill on his desk that they say would “codify illegal, racially discriminatory lending practices which differentially harmed communities of color.”
“The finance industry must not be absolved of accountability for their unjust practices,” said the Aug. 7 letter.
The US government could soon be brought to you by French health care or Asian pension funds.
Janet Yellen’s Federal Reserve is about two months away from ending its unprecedented quantitative easing program, which at its height bought $85 billion a month in bonds.
Pensions and insurance companies abroad are expected to fill the debt-buying void left after the central bank ends its tapering.
That’s because Yellen’s continental counterpart, European Central Bank President Mario Draghi, announced last week that he expects to keep interest rates there lower for a longer time than the US.
Wall Street’s reputation, despite a 5-year bull market, still stinks.
Indeed, the bankers’ “chronic risk image” remains a huge problem, say many of the mid-level pros who work for its largest firms.
The Street’s regulatory and image problems continue to spook many traders and bankers, who say the risks and dangers of the industry are about the same as before the stock market meltdown of 2008, according to the results of the Makovsky Wall Street Reputation Study.
“The 2014 study findings question how far financial services brands have advanced since the financial crisis,” according to Scott Tangney, executive vice president at Makovsky.
“The industry,” he adds, “is walking on a tightrope, with the combination of negative perception, regulator actions and greater risk sapping reputation and financial performance.”
Financial services continue to be “pummeled by negative perception and regulatory overhaul and action,” according to poll respondents.
The biggest perception problems for the industry, the poll found, were “negative public perception” (64 percent) and “regulatory actions” (55 percent). The latter includes investigations, lawsuits and fines.
Securities regulators have filed fraud charges against the state of Kansas Monday, alleging bond offering documents failed to disclose the risks to investors from the state’s underfunded pension system.
The Securities and Exchange Commission has previously taken action against New Jersey and Illinois over pension disclosures to investors. In Kansas’s case, the commission focused on disclosures related to bond issues that raised $273 million in 2009 and 2010.
“Investors must be given adequate information to evaluate the impact of pension fund liability on a state’s overall financial condition,” Andrew Ceresney, director of the SEC Enforcement Division, said in a statement.
Kansas agreed to a cease-and-desist order against future violations and has taken remedial action on its pension disclosures, the SEC said.
Law360, Washington (August 11, 2014, 1:56 PM ET) — In multidistrict litigation over mortgage-backed securities sold by Bank of America Corp., Royal Park Investments SA/NV asked a California federal court Friday to revive its claims against the bank over $1.6 billion in the allegedly toxic MBS, saying material facts were ignored when a judge dismissed the suit.
RPI — a special purpose investment entity created by the Belgian government to hold bad assets after the financial collapse of Fortis Holding NV and its subsidiary Fortis Bank SA/NV — asked U.S. District Judge Mariana R. Pfaelzer…