Daily Archives: February 18, 2015

FBI filings, now unsealed, allege former Rep. Grimm had financial stake in his health food store, which led to his downfall, even after joining Congress

STATEN ISLAND, N.Y. — Even after he was elected to Congress, former Rep. Michael Grimm still had a financial stake in the Manhattan restaurant that sunk his political career and made him a convicted felon, according to allegations in newly-unsealed court documents.

Grimm had a business partner back-date documents to show he had sold his stake in Healthalicious — an Upper East Side wrap-and-smoothie restaurant — on June 30, 2010, but e-mails obtained by the FBI showed he maintained financial ties with the restaurant through at least 2012, the documents allege.

In one e-mail, dated Dec. 21, 2010 — after he won the race to become Staten Island’s congressional representative — he needled his business partner about having to write up an agreement describing his sale of the property, the FBI alleged.

“Hope you are enjoying your night out while I am home drafting your legal documents. It must be nice having a Congressman work for you for free….” he wrote, according to the filings.

The revelations came in two heavily redacted search warrant applications filed by the FBI in December 2013 and January 2014 in the campaign finance fraud case of Diana Durand, Grimm’s ex-girlfriend. The filings include several e-mails between him and a business partner and government cooperator referred to as “CW #1.”

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HLSS and Ocwen escalate fight against mortgage negligence claims

It appears that Home Loan Servicing Solutions (HLSS) and its associated company, Ocwen Financial (OCN) take the claims that they breached their mortgage bond covenants quite seriously.

The companies are fighting back against the claims of hedge fund BlueMountain Capital Management, which recently sent notices of default to Ocwen and HLSS, saying that Ocwen’s regulatory troubles have caused an “irrefutable” default on notes the hedge fund holds in connection with the HLSS Servicer Advance Receivables Trust.

HLSS has already questioned BlueMountain’s motivation in publicly stating that HLSS defaulted on mortgage-backed securities that BlueMountain claims it owns.

“We have very serious concerns about BlueMountain’s motivations for publicly filing their letter, James Lauter, HLSS’ senior vice president and chief financial officer, said in a recent letter sent to Deutsche Bank National Trust Company, the indenture trustee.

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RMBS Fraud Claims Against Bank of America Dismissed

On February 6, 2015, Judge Stanley Chesler of the United States District Court for the District of New Jersey granted in part and denied in part Bank of America’s motions to dismiss two related cases filed against it by several Prudential Insurance Company affiliates. Prudential asserted common law fraud, misrepresentation, and RICO claims against several Bank of America entities arising out of Prudential’s investment in $1.9 billion in RMBS. Judge Chesler dismissed Prudential’s fraud claim, holding that Prudential failed to adequately allege falsity and/or scienter in connection with alleged misstatements concerning occupancy status, appraisals, and credit ratings. He also held that, for the 21 securitizations at issue for which Bank of America served as underwriter only, Prudential failed to allege with the required specificity which Bank of America entity made which challenged representations. Judge Chesler dismissed both of Prudential’s negligent misrepresentation claims. He granted Prudential limited leave to amend in connection with the fraud claim relating to those securitizations for which Bank of America served as underwriter only. Opinion.

Source: JDSupra

Bank of America cutting 69 mortgage jobs

Another round of layoffs at BofA…

As the number of delinquent mortgages in its portfolio shrinks, Bank of America Corp. is reducing the size of its division that handles those bad loans.

Bank of America on Monday filed a Worker Adjustment and Retraining Notification with the state saying it will cut 69 jobs in April at its office complex near The Avenues Mall in Jacksonville.

The company said in an emailed statement Tuesday that most of the jobs being eliminated are in its Legacy Asset Servicing division.

“With fewer mortgage customers experiencing delinquency and no longer needing the specialized services and programs we have built, we continue to reduce the size of these operations,” the company said.

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HSBC : Swiss raid HSBC’s Geneva office in investigation

The Geneva, Switzerland, office of an HSBC Bank subsidiary was searched Wednesday in an ongoing money-laundering investigation, Swiss prosecutors said.

The probe centers on alleged money-laundering allegations and claims the bank helped clients evade taxes and conceal $100 billion. The International Consortium of Investigative Journalists (ICIJ) reported the bank “repeatedly reassured clients that it would not disclose details of accounts to national authorities” and suggested procedures that “ultimately allow clients to avoid paying taxes in their home countries.”

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HSBC whistleblower says would face Swiss trial under conditions

Herve Falciani, the former HSBC employee who supplied information on the bank’s clients and their tax situation, said he was willing to return to Switzerland to stand trial if he was given assurances that he would not face immediate arrest.

Geneva’s public prosecutor earlier on Wednesday searched HSBC’s lakeside Swiss office after opening a criminal inquiry into allegations of aggravated money laundering, which emerged in 2008 after Falciani fled with files he took from the bank.

“I hope to have the possibility of a right of safe passage first to attend my trial, I am not trying to dodge my responsibility,” Falciani told Swiss French-language broadcaster RSR, which said he was speaking from a cafe in Italy.

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Feds reissue checks related to the Independent Foreclosure Review

For the Federal Government, maybe the third time will be the charm.

According to the statistics, 800,000 foreclosed homeowners are still missing out on $500 million in compensation.

Replacement checks are being mailed this week to borrowers eligible for payment under the Independent Foreclosure Review Payment Agreements and who have not yet cashed or deposited their check, the Federal Reserve Board and the Office of the Comptroller of the Currency announced Wednesday.

The checks are being sent by the paying agent, Rust Consulting, to replace uncashed checks that have now expired.

Agreements reached in January 2013 between federal bank regulatory agencies and 13 mortgage servicers provided $3.6 billion in cash payments to borrowers whose homes were in any stage of the foreclosure process in 2009 or 2010.

The mortgages were serviced by one of the following 13 companies, their affiliates, or subsidiaries:  Aurora, Bank of America, Citibank, Goldman Sachs, HSBC, JPMorgan Chase, MetLife Bank, Morgan Stanley, PNC, Sovereign, SunTrust, U.S. Bank, and Wells Fargo.

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