Benjamin Lawsky, New York state’s financial services regulator, has added himself to the regulators investigating Deutsche Bank AG for manipulation of the Libor benchmark borrowing rate, the Financial Times reported on Sunday, citing unnamed sources.
The New York Department of Financial Services’ probe of the German bank marks the first Libor investigation for the regulator. Deutsche Bank is currently negotiating a settlement with the U.S. Justice Department, the newspaper said.
Lawsky’s department regulates banks with charters in New York as well as foreign banks with branches in the state. He is not investigation other banks, which have already settled with the government, the Financial Times said.
PHILADELPHIA – The collapse of the auction-rate securities market led Reading Health System to sue Bear Stearns & Co., now known J.P. Morgan Securities, in Federal Court over its issuance of nearly $519 million of ARS debt.
Source: Courthouse News
ATLANTA (CN) – The owner of a now-defunct mortgage lender cannot duck claims that he defrauded the United States of millions of dollars by falsifying loan applications, a federal judge ruled.
Home America Mortgage, a former private lender based in Atlanta, and Ocala, Fla.-based Taylor, Bean & Whitaker Mortgage Corp., which acted as the underwriter for Home America’s mortgage loans, faced claims that they induced the United States to insure dozens of bad mortgage loans.
Two whistleblowers brought a false claims action against the two companies in December 2006, alleging they had caused the government to lose more than $131 million.
Greg Hicks, who owned 90 percent of Home America, and Carl Wright, an Atlanta-based closing attorney, were also named as defendants.
According to the complaint, Home America originated mortgage loans and immediately sold them to Taylor, Bean & Whitaker, which applied for federal mortgage insurance for the loans. The whistleblowers claimed that Hicks and Home America changed borrower and property information on loan applications, fabricated documents and overrode safeguards on rejected applications, causing the government to insure high-risk loans.
(Bloomberg) — Deutsche Bank AG will probably spin off its consumer bank to help it meet capital requirements, Reuters reported, citing people with knowledge of the proposal whom it didn’t identify.
The German lender’s supervisory board was briefed on three restructuring scenarios proposed by the management board at a meeting on Friday and favors one in which Deutsche Postbank AG and other consumer businesses would be grouped and spun off as a separate public company, Reuters reported Saturday. All of the scenarios would have an impact on the consumer bank, and no decision is expected until the end of April, one person cited by Reuters said.
Here, here.. And I concur…
You may remember my recent column on Richard Bowen, the Dallas banker who blew the whistle on Citigroup and is considered by many to be an unsung American hero.
The 68-year-old senior lecturer of accounting was once a top executive with Citigroup’s mortgage lending organization. When his warnings of internal malfeasance got him sacked, Bowen filed a complaint under Sarbanes-Oxley and later testified before Congress.
He has nothing to show for his efforts.
Well, he’s not done.
On Friday morning, Bowen appeared on Bloomberg Television’s Market Makers hosted by Stephanie Ruhle. He announced that he’s requested a congressional investigation into possible cover-ups he says he witnessed at the Financial Crisis Inquiry Commission.
But time is running out for charges to be filed.