Daily Archives: January 18, 2015

Libor Lawsuits Cloud Bank Body Merger Plan

A series of class action lawsuits over the Libor rate-rigging scandal is acting as an obstacle to plans for a merger of the UK banking sector’s leading trade associations.

Sky News has learnt that directors of the British Bankers’ Association (BBA) have raised concerns about the legal implications of a consolidation which would be aimed at helping the industry repair its image more than six years after the financial crisis swept through the UK banking system.

The disclosure of BBA board members’ concerns comes ahead of the publication this week of a consultation paper on the possible consolidation of trade bodies across the retail and commercial banking sectors.

According to the document, a copy of which has been obtained by Sky News, representatives of the UK’s biggest banks are minded to recommend the creation of a new umbrella body which would amalgamate existing associations including the BBA, Council of Mortgage Lenders, the Payments Council and the UK Cards Association.

Read on.

Homeowners billed for houses lost in foreclosure

When Guillermo Galindo lost his two-family Revere home to foreclosure in 2009, the soft-spoken Colombian thought he had finally freed himself from the flood of threatening collection letters from his lender and a ballooning, untenable debt.

All of his savings, scraped together over years delivering medicine for local pharmacies, were gone, along with the home he bought in 2005 for $410,000. Devastated, the 54-year-old immigrant, along with his wife and 3-year-old daughter, packed their belongings and moved into a small apartment, hoping to rebuild.

But that hope evaporated in a matter of months, when Galindo received a letter from a lawyer saying he owed $136,547 on the family home he’d left behind.

The lawyer represented a mortgage insurance company that Galindo had paid premiums to for years. He’d never given his insurance policy much thought — it was just something he needed to buy to qualify for a mortgage, since he couldn’t afford a big down payment. He thought it would help him if he got in a bind.

Too late, Galindo realized that the policy protected only the bank, and nothing prevented the insurer from coming after him for losses related to the foreclosure on his former home in Revere.

“I have to fight every day to find my food and not go to welfare, and then I have to pay $140,000?” Galindo asked. “What did I pay insurance for? It was a rip off.”

What Galindo considers a rip off is an insurance industry practice that has the potential to flatten tens of thousands of former homeowners just as they are getting back on their financial feet. The New England Center for Investigative Reporting has found that more than 200 Massachusetts residents and thousands more across the United States have been pursued by mortgage insurers for losses ranging from tens of thousands of dollars to more than $200,000 since the foreclosure crisis began about seven years ago.

Read on.

Fox News turns to Jamie Dimon to advise Obama on appropriate SOTU topics

Jamie dimon Fox Channel

It’s pretty sad that a cable station to ask a bank CEO who basically owns the government and Congress and whose bank has committed more crimes in this country and continues to buy their way out of jail time for advice for the President’s State of the Union address speech!!!!  It is bad enough that Dimon took the role to advice and pay off Congress to vote for the Cromibus bill!  Fox Business Maria Bartiromo turned to Dimon to give the President some of his sage wisdom. Here’s Dimon’s list: Infrastructure, corporate tax reform, immigration reform, education reform including community college assistance, and trade policy. Oh, and Dimon swears the Trans-Pacific Partnership would be great for the economy.

Here is the video. Click here.


Should Jamie Dimon Be Criminally Prosecuted?

If you are not reading the free book offered on-line, a chapter per month, called “JPMadoff: The Unholy Alliance Between America’s Biggest Bank and America’s Biggest Crook,” you are missing out. This book is among the best commentary on contemporary American life that I have ever read. And it’s free, for heavens sake!

The authors, Helen Davis Chaitman and Lance Gotthoffer, are among the nation’s top litigators and their experience and expertise is obvious as they explain how the Obama administration has left this country in a moral vacuum with its policy of not enforcing the criminal laws against this country’s biggest criminals. One hundred years from now, historians will look back upon this period in our history and ask: What was Obama thinking? In his administration, if you are a petty thief, you go to prison in a police van. But if you are a big-time crook, you go to Greenwich every day in your limousine.

Chapter 6 of the Chaitman/Gotthoffer book is now available at jpmadoff.com and it lays out, for all of us to comprehend, the outrageous conduct of officers of JPMorgan Chase — including Jamie Dimon — relating to the London Whale. If you take pride in being well-informed, you have to read this chapter. I guarantee that, once you do so, you will be asking yourself: “Why didn’t someone go to jail for this?” That’s a question the authors have anticipated; they answered it in an prior chapter, Chapter 3.

Read on.

Senator Feinstein husband stands to profit big from government deal?

IJ Review:

What’s the secret to her financial success? Why, it’s her politically connected husband, Richard Blum.

One of the ways Blum has enriched himself is by bidding on Federal government contracts on behalf of his companies. According to the New York Post, Blum’s company stands to make $1 billion (yes, that’s with a “b”) in commissions from the sale of U.S. Postal Service properties.

The US Postal Service plans to sell 56 buildings — so it can lease space more expensively — and the real estate company of the California senator’s husband, Richard Blum, is set to pocket about $1 billion in commissions.
Blum’s company, CBRE, was selected in March 2011 as the sole real estate agent on sales expected to fetch $19 billion. Most voters didn’t notice that Blum is a member of CBRE’s board and served as chairman from 2001 to 2014.
This feat of federal spousal support was ignored by the media after Feinstein’s office said the senator, whose wealth is pegged at $70 million, had nothing to do with the USPS decisions.

This isn’t the first-time companies with ties to Richard Blum have gotten government contracts that benefitted them greatly. In 2007, Feinstein wasforced to resign as chairman of the powerful Military Construction Appropriations subcommittee after it was found that should she steered contracts to companies owned by her husband. Questions have also been raised about the current Postal Service contract with Blum’s company as well.

SF Home Loan Bank Takes $459M To Settle MBS Claims

Law360, Los Angeles (January 16, 2015, 7:38 PM ET) — The Federal Home Loan Bank of San Francisco reached a $459 million deal with banks it accused in California state court of lying about the quality of billions of dollars in mortgage-backed securities that the lender bought, according to a filing to the U.S. Securities and Exchange Commission on Friday.

The FHLB didn’t disclose which banks were included in the settlement, though it has sued Credit Suisse (USA) LLC, Countrywide Financial Inc., Bank of America Corp., Deutsche Bank AG, Morgan Stanley & Co. and others, according…

Source: Law360

NY AG Schneiderman to target more banks for mortgage securities fraud


Banks are not past the days of mortgage fraud cases, according to an article in Reuters. Eric Schneiderman, the New York attorney general, said he plans to bring more fraud cases against the world’s biggest banks for selling shoddy mortgage-backed securities before the financial crisis.

“Obviously there were many more institutions involved,” Schneiderman said in an interview this week. “So there will be more cases.”

The attorney general said that group remains “very active,” while declining to discuss whether he is in settlement talks with Morgan Stanley, the bank that sources say is next in line for a settlement. A spokesman for Morgan Stanley also declined to comment.

Just two months ago, Mega bank JPMorgan Chase (JPM) signed an agreement with government agencies, including Schneiderman’s office, to end all existing legacy mortgage-backed securities issues for $13 billion.

Source: Reuters

Ocwen’s Altisource Spinoff Fires 800 as CEO Pleas for Calm

Altisource Portfolio Solutions served notice to over 800 employees and several hundred more contractors as part of an effort to reassure shareholders whose stock has plunged this week.

Nearly all the cuts were made this week at offices spanning from Boston to India, where several hundred personnel tied to the mortgage technology and outsourcing company were let go, said a person with direct knowledge of the matter.

Read on.