Daily Archives: January 28, 2015

Big banks fail to dismiss U.S. currency rigging lawsuit

A federal judge on Wednesday said U.S. investors may pursue a nationwide antitrust lawsuit accusing 12 major banks of rigging prices in the $5.3 trillion-a-day foreign exchange market.

U.S. District Judge Lorna Schofield in Manhattan rejected the defendants’ arguments that the case should be dismissed because of a lack of evidence that they colluded to manipulate the WM/Reuters Closing Spot Rates, known as the Fix, or that they impeded competition and caused harm.

“Fairly read, the U.S. complaint adequately alleges that defendants engaged in a long-running conspiracy to manipulate the Fix to defendants’ advantage,” Schofield wrote in a 30-page decision.

The bank defendants include Bank of America Corp (>> Bank of America Corp), Barclays Plc (>> Barclays PLC), BNP Paribas SA (>> BNP PARIBAS), Citigroup Inc (>> Citigroup Inc), Credit Suisse Group AG (>> Credit Suisse Group AG), Deutsche Bank AG (>> Deutsche Bank AG), Goldman Sachs Group Inc (>> Goldman Sachs Group Inc), HSBC Holdings Plc (>> HSBC Holdings plc), JPMorgan Chase & Co (>> JPMorgan Chase & Co.), Morgan Stanley (>> Morgan Stanley), Royal Bank of Scotland Group Plc (>> Royal Bank of Scotland Group plc) and UBS AG <UBSG.S>.

According to the 2013 lawsuit, these banks have held an 84 percent global market share in currency trading, and were counterparties in 98 percent of U.S. spot volume.

The lawsuit is separate from criminal and civil probes worldwide into whether banks rigged currency rates to boost profit at the expense of customers and investors.

In the complaint, investors including the city of Philadelphia, hedge funds and public pension funds accused the banks of having conspired since January 2003 in chat rooms, instant messages and emails to manipulate the Fix.

Read on.

Judge rules Fannie, Freddie lawsuits can continue

ohn Carney at the Wall Street Journal is reporting that a federal claims judge has ruled against the federal government, saying that a lawsuit brought by investors over the treatment of Fannie Mae and Freddie Mac can proceed.

Here’s the latest:

A judge in the U.S. Court of Federal Claims denied the government’s motion to stay proceedings in that court, according to two people familiar with the decision. Lawyers for the government had asked the Court of Claims to put the lawsuits on hold pending the appeal of a decision by a judge in the U.S. District Court for the District of Columbia that dismissed a similar group of cases last September.

Shares of Fannie jumped by more than 8% Wednesday morning. Shares of Freddie rose by more than 4%.

Wednesday’s decision means the plaintiffs, who include Fairholme Funds, will be able to continue to collect information from the government in hopes of bolstering their argument that the Court of Claims has jurisdiction over the cases.

Read on.

JPMorgan Reaped Up to $300 Million Gain On Swiss-Franc Turmoil

(Bloomberg) — JPMorgan Chase & Co.’s foreign-exchange traders reaped a gain of as much as $300 million after the Swiss central bank roiled markets by abolishing its cap on the franc, according to two people with knowledge of the matter.

The bank netted $250 million to $300 million on the day of the Swiss National Bank’s surprise decision to scrap the franc ceiling of 1.20 against the euro, said the people, who asked not to be identified because they weren’t authorized to speak publicly. A JPMorgan spokesman declined to comment.

The SNB’s surprise decision on Jan. 15 to remove the three-year-old cap sent the franc soaring as much as 41 percent against the euro that day. JPMorgan is one of the few to emerge from the turmoil with a profit. Citigroup Inc., Deutsche Bank AG and Barclays Plc suffered about $400 million in cumulative trading losses, people with knowledge of the matter have said.

Read on.

Illinois AG to look into Kendall family foreclosure

Monday, we told you the story of a Kendall family desperately working to save their house from foreclosure.

Tuesday, we learned that after our story aired, the Illinois State Attorney General’s Office contacted the family to say they’re investigating what happened to them. Two years ago, the family hired a Chicago law firm to get them out of foreclosure.

But now the firm has taken about $9,000 of their money and didn’t get a deal done. The law firm has since shut down their website and disconnected their phones.

Read on.

U.S. Scrutinizing Rabobank’s California Accounts

(Bloomberg) — The U.S. is investigating whether the Netherlands’ Rabobank Groep ignored signs of money laundering by clients at branches of its California banking unit near the Mexican border, according to people with knowledge of the matter.

The criminal investigation is being conducted by Justice Department prosecutors in Washington and the U.S. Attorney’s Office in San Diego, said two people who asked not to be identified because the inquiry is confidential. The probe could trigger additional enforcement action against Rabobank, which is still being monitored by the Justice Department after admitting wrongdoing in a 2013 settlement over interest-rate manipulation.

Read on.

BREAKING: DOJ, States Near $1.38B Accord With S&P

Law360, New York (January 28, 2015, 12:39 PM ET) — Standard & Poor’s Ratings Services will pay $1.375 billion to settle lawsuits brought by the U.S. Department of Justice and 20 attorneys general around the country over the firm’s ratings work leading up to the financial crisis, according to a person familiar with the matter.

The settlement is expected to be announced as early as next week, the person said. Details of the landmark accord, such as how the haul will be divvied up between authorities, could not immediately be confirmed.

An S&P spokeswoman declined to…

Read on.

WATCH: Famous televangelist Pat Robertson gives terrible reverse mortgage advice

More from Housingwire.

GIBBS & BRUNS LLP: CERTIFICATEHOLDERS ISSUE NOTICE OF NON-PERFORMANCE IDENTIFYING ALLEGED FAILURES BY OCWEN FINANCIAL CORPORATION AS SERVICER OR MASTER SERVICER TO PERFORM COVENANTS AND SERVICING AGREEMENTS IN 119 RESIDENTIAL MORTGAGE BACKED SECURITIES TRUSTS

Thank you blogger Neidermeyer for sharing this info:

01.23.2015

HOUSTON, January 23, 2015 – Today, the Holders of 25% Voting Rights in 119 Residential Mortgage Backed Securities Trusts (RMBS) with an original balance of more than $82 billion issued a Notice of Non-Performance (Notice) to BNY Mellon, Citibank, Deutsche Bank, HSBC, US Bank, and Wells Fargo, as Trustees, Securities Administrators, and/or Master Servicers, regarding the material failures of Ocwen Financial Corporation (Ocwen) as Servicer and/or Master Servicer, to comply with its covenants and agreements under governing Pooling and Servicing Agreements (PSAs).

Based on a lengthy investigation and analysis by independent, highly qualified experts, the Holders’ Notice alleges Ocwen has failed to perform, in material respects, its contractual obligations as Servicer and/or Master Servicer under the applicable PSAs in the following ways:

  • Use of Trust funds to “pay” Ocwen’s required “borrower relief” obligations under a regulatory settlement, through implementation of modifications on Trust- owned mortgages that have shifted the costs of the settlement to the Trusts and enriched Ocwen unjustly;
  • Employing conflicted servicing practices that enriched Ocwen’s corporate affiliates, including Altisource and Home Loan Servicing Solutions, to the detriment of the Trusts, investors, and borrowers;
  • Engaging in imprudent and wholly improper loan modification, advancing, and advance recovery practices;
  • Failure to maintain adequate records,  communicate effectively with borrowers, or comply with applicable laws, including consumer protection and foreclosure laws; and,
  • Failure to account for and remit accurately to the Trusts cash flows from, and amounts realized on, Trust-owned mortgages.

As a result of the imprudent and improper servicing practices alleged in the Notice, the Holders further allege that their experts’ analyses demonstrate that Trusts serviced by Ocwen have performed materially worse than Trusts serviced by other servicers.  The Holders further allege that these claimed defaults and deficiencies in Ocwen’s performance have materially affected the rights of the Holders and constitute an ongoing Event of Default under the applicable PSAs.  The Holders intend to take further action to recover these losses and protect the Trusts’ assets and mortgages.

The Notice was issued on behalf of Holders in the following Ocwen-serviced RMBS:

ABFC 2004-OPT4 DBALT 2007-RMP1 MALT 2006-2 RASC 2006-EMX3
ABFC 2005-WMC1 FFML 2004-FF3 MSAC 2003-SD1 RASC 2006-EMX4
ABFC 2006-HE1 FFML 2005-FF1 MSAC 2004-HE4 RASC 2006-EMX6
ABSHE 2003-HE5 FHLT 2006-A MSAC 2006-HE1 RASC 2006-KS5
ABSHE 2004-HE3 GSAA 2006-16 MSAC 2006-HE2 RASC 2006-KS6
ACE 2002-HE1 GSAA 2007-10 MSAC 2007-HE4 RASC 2006-KS8
ACE 2004-FM2 GSAA 2007-8 MSAC 2007-HE5 RASC 2007-KS1
ACE 2004-OP1 GSAMP 2003-NC1 MSHEL 2007-2 RASC 2007-KS3
ACE 2005-SD3 GSAMP 2004-OPT MSM 2006-8AR RAST 2005-A10
ACE 2006-SD2 GSAMP 2005-WMC1 MSM 2006-9AR RAST 2005-A13
ACE 2006-SD3 GSAMP 2006-HE6 NHEL 2006-6 RAST 2005-A16
AHMA 2005-1 GSAMP 2007-H1 RAAC 2005-SP2 RAST 2006-A15
AHMA 2006-4 GSAMP 2007-HS1 RAAC 2007-SP1 RAST 2006-A16
AHMA 2007-4 GSR 2005-AR7 RAAC 2007-SP3 RAST 2006-A2
ARMT 2005-10 GSR 2006-10F RALI 2004-QS1 RFMSI 2006-S2
BAFC 2007-3 GSR 2006-4F RALI 2005-QA13 RFMSI 2006-SA1
BALTA 2005-4 GSR 2007-2F RALI 2005-QS1 RFMSI 2007-SA4
BSABS 2006-AC1 HVMLT 2003-1 RALI 2005-QS11 SABR 2006-FR1
CBASS 2001-CB4 HVMLT 2005-16 RALI 2006-QA7 SABR 2006-FR2
CBASS 2004-CB3 HVMLT 2005-4 RALI 2007-QA2 SABR 2006-FR3
CBASS 2004-CB4 HVMLT 2005-7 RAMP 2005-RS7 SABR 2006-FR4
CBASS 2004-CB7 HVMLT 2006-3 RAMP 2006-RS2 SASC 2004-13
CBASS 2005-CB1 HVMLT 2006-SB1 RAMP 2006-RS6 SASC 2006-GEL3
CBASS 2006-CB5 MABS 2003-OPT2 RAMP 2006-RZ2 SASC 2007-TC1
CBASS 2006-CB9 MABS 2004-OPT1 RAMP 2007-RS1 SVHE 2005-3
CBASS 2007-CB3 MABS 2005-FRE1 RASC 2001-KS1 SVHE 2006-NLC1
CMLTI 2007-SHL1 MABS 2006-AM1 RASC 2004-KS12 TBW 2006-1
DBALT 2005-1 MABS 2006-AM3 RASC 2005-AHL1 TBW 2006-3
DBALT 2005-AR2 MABS 2006-FRE2 RASC 2005-AHL3 TMST 2007-3
DBALT 2006-AR1 MALT 2006-1 RASC 2005-EMX3

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Source: Gibbs & Bruns LLP

53 Percent Of Black Wealth Wiped Out: Foreclosure Crisis Erodes Communities Of Color