U.S. authorities have intensified their scrutiny into a handful of major financial institutions’ handling of potentially tainted funds connected to widespread allegations of corruption within soccer’s governing body, FIFA, according to people familiar with the matter.
Prosecutors in the Brooklyn U.S. attorney’s office and New York’s top banking regulator have separately contacted more than a half dozen banks combined in connection with the soccer scandal in recent weeks. Authorities are focused on whether the banks’ required anti-money-laundering systems should have caught the allegedly corrupt payments, the people said. They have also told the banks to scour their books for any illegal payments related to FIFA, they said.
Prosecutors have questioned HSBC Holdings PLC, Standard Chartered PLC and Delta National Bank and Trust Company, according to the people. At least three other major international banks have been contacted in the probe, the people said. Those banks could not be identified and it’s not clear if the separate probes by the U.S. attorney’s office and the New York regulator are looking at identical groups of banks.
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Bank is appealing judge’s order imposing $1.27 billion in penalties
Case centers on Countrywide’s now-defunct “Hustle” program
Jury in 2013 found Countrywide liable for knowingly selling bad home loans
A federal appeals court should not overturn a judge’s ruling that Bank of America pay $1.27 billion in penalties for defective mortgages sold in Countrywide Financial Corp.’s now-defunct “Hustle” program, the U.S. government says.
On Wednesday, the government filed its opposition to Bank of America’s appeal of the penalties the federal judge imposed on it last year in the three-year-old case. The Charlotte bank was ordered to pay the penalties after a jury in 2013 found Countrywide Financial liable for knowingly selling bad home loans to mortgage giants Fannie Mae and Freddie Mac.
In February, the judge who ruled the bank should pay the penalties, Jed Rakoff in Manhattan, denied the lender’s request to overturn the jury’s verdict. Bank of America, which has said the Hustle program ended before it bought Countrywide in 2008, appealed that decision in April.
We learn from the New York Times that:
AFTER the financial crisis of 2008, there was one thing that almost everyone agreed on. The government-sponsored mortgage giants, Fannie Mae and Freddie Mac, had to go. While shareholders and executives reaped the profits from Fannie and Freddie in good times, taxpayers were stuck with the bill in a crisis. President Obama described their dysfunctional business model as “Heads we win, tails you lose.” But here we are, seven years after the crisis, and nothing has changed.
In the 2008 crisis, when it looked as if Fannie and Freddie might go bankrupt, Henry M. Paulson Jr., then the Treasury secretary, argued that their fall would cause economic catastrophe. Foreign investors, stuck with their securities, would panic, and the mortgage market would shut down. So Fannie and Freddie were put into something called conservatorship, and are now government controlled, supported by a line of credit from the Treasury.
Conservatorship was supposed to be temporary — a “time out,” according to Mr. Paulson. We were going to stabilize the companies’ finances, reduce their importance to the mortgage market, and figure out a better system. But nothing happened. In fact, the situation has gotten even more precarious. In the years since the crisis, private lenders, for the most part, have been willing to make mortgages if they can immediately sell them to government agencies, mainly Fannie and Freddie. In other words, without Fannie and Freddie, there wouldn’t be much of a mortgage market.
To make things worse, the government decided to “sweep” almost all the duo’s profits into its own coffers, to be used as a slush fund for general government expenses. As Treasury Secretary Jacob J. Lew said in congressional testimony this spring, “As a practical matter it’s what has helped us reduce our overall deficit.” If there is another downturn in the real estate market and Fannie and Freddie suffer losses on their some $5 trillion in outstanding securities, taxpayers will again have to foot the bill.
By Clara Herzberg, Truthout | Op-Ed
Well, well, well. Eric Holder is returning to his cushy job at Covington & Burling where he reportedly pulled in $2.5 million the last year he was there. Holder didn’t think it was strange he was returning to one of Wall Street’s most highly regarded defense firms after all the bankers he let breezily carry on with fraud, bribery, money laundering, tax evasion and plenty of other very prosecutable offenses during his tenure as US attorney general.
Holder explained simply: “The firm’s emphasis on pro bono work and being engaged in the civic life of this country is consistent with my worldview that lawyers need to be socially active.” Yeah, and what about the $2.5 million, Mr. Holder? That’s got nothing to do with it surely.
Holder had just spent six years in Washington handing out slaps on the wrist to financial institutions that claimed they were “too big to fail” while secretly receiving government assistance. His help almost certainly amounted to billions of dollars of aid to Wall Street. Now he’s trotting back on his high horse to go collect millions for his top position in the firm.
Reaffirming their position that the fees charged by Fannie Mae and Freddie Mac should not be used to fund federal spending, Sen. Mike Crapo, R-Idaho, and Sen. Mark Warner, D-Va., sent a letter to the Senate leadership, asking them to reconsider the use of g-fees to offset the cost of a massive transportation bill.
The bill, called The Developing a Reliable and Innovative Vision for the Economy Act or the DRIVE Act, is a six-year highway authorization that will allow planning for important long-term projects around the country, and provides three years of guaranteed funding for the highway trust fund.
But one of the ways the $47 billion bill is paid for is a significant delay to scheduled cuts in g-fees. The bill would delay a scheduled 10 basis point cut in g-fees from 2021 to 2025.
Earlier this year, Crapo and Warner introduced budget point of order that would prevent g-fees from being used to offset federal spending, a practice the Senators call a “budgetary gimmick” and a “back door tax” on homeowners.
Case 1:13-cv-00465-MMS Document 205 Filed 07/14/15 Page 1 of 82
Here is the court document order from Judge Sweeney for those that are interested. Click here to view the judge’s order granting general leave. And here is the court document of plantiff’s motion to unseal Treasury and FHFA documents. Click here.
2015-07-14 Plaintiffs Redacted Motion to Unseal PwC Documents
2015-07-14 Plaintiffs Redacted Motion to Unseal Fannie Mae Documents
2015-07-14 Plaintiffs Redacted Motion to Unseal Deloitte Documents
2015-07-14 Plaintiffs redacted motion to unseal Graham Thornton documents documents
7:15:15 Motion to unseal Freddie Mac documents pdf
On 7/14/15 in a motion put forth by the government arguing for more time to respond to the motion to unseal documents and depositions, this was confirmed: