In the heady and panicked months following the financial crash of 2008, the US government bailed out a handful of the United States’ biggest financial institutions. Among those were the investment banks Goldman Sachs and Morgan Stanley, which together received bailouts and loans totaling over $100 billion.
Among the terms of the bailout was that they both become bank holding companies, which meant they had the authority to own banks. While this may seem like an expansion of influence, the move has actually placed the previously independent investment banks under new regulation and supervision. It also opened the door for the companies to enter further into consumer lending than they could have as traditional investment banks.
This summer, news broke that Goldman Sachs would be taking advantage of its “bank holding company” designation to branch into the online loan market. According to The New York Times, which reported the story on June 15, the bank will be moving to offer loans of a few thousand dollars through a yet-to-be-launched online portal.
The consumer base will be significantly different the bank’s usual clientele – “the powerful and privileged,” as The New York Times called them.
But offering lower-cost loans to a broader group of people may not be as far from Goldman’s usual dealings as it seems at first. In fact, some loan industry advocates say online loans can often be predatory and underregulated – just like the pre-2008 housing market.
“Goldman was one of the prime movers behind the selling of mortgage-backed securities,” said Liz Ryan Murray, policy director for National People’s Action, a network of local organizing groups that are running a campaign against predatory lending.
Awards of $2.73 million in damages and $201,000 in attorney fees against Wells Fargo in a real estate dispute have been vacated, and the suit tossed out, by a New Jersey appeals court.
The Appellate Division, reversing a Bergen County trial judge’s 2013 decision, found “no basis in the record … to conclude that defendant breached its implied covenant of good faith and fair dealing” in backing out of a deal to purchase two adjacent Wyckoff properties for construction of a bank branch.
According to court documents, Wells Fargo predecessor Wachovia entered into two lease agreements in December 2007 for construction of a bank branch on the parcels, at the corner of Franklin and Godwin avenues, as part of a nationwide expansion. Wachovia planned to use one parcel for the structure and the other for a parking lot.
The leases provided for a 90-day inspection period, during which Wachovia could terminate for any reason, followed by a six-month approval period, during which Wachovia was required to seek government approvals for the planned use of the site. The contracts provided that, at the end of the six months, Wachovia could extend the approval period by up to two three-month periods, provided that they pay the property owners $2,000 per month, according to documents.
Read more: http://www.njlawjournal.com/id=1202735157936/Court-Upends-293M-in-Damages-Fees-Against-Wells-Fargo#ixzz3jO09uSX8
Most board members in June received restricted stock worth approximately $36,000, meaning that even the lowest-paid board member will now make nearly $280,000 a year.
A bank spokesman pointed out that most of its board members haven’t received a raise since 2006 and that their responsibilities have increased greatly since then. Bank of Americaboard members earn more than the median pay for other companies in the S&P 500, but their base pay was less than that of directors at some other big banks.
Greece is in serious trouble…
Update: GREEK PM TO HAND IN RESIGNATION TO PRESIDENT LATER ON THURSDAY -GOVT OFFICIALS
“Greek state broadcaster ERT is reporting that the embattled prime minister will announce the vote later today. The PM has been meeting with government officials this afternoon and could resign from office having called the vote. September 13 and 20 have been touted as possible dates.”
Read more from Zerohedge. Click here.
Hundreds of bankers may have used their work email addresses to register for the adultery website AshleyMadison.com, MarketWatch found after searching data provided by security researcher Robert Graham.
Hackers on Tuesday unleashed the purported email and street addresses, phone numbers and credit-card details of about 36 million people represented as users of the adultery website AshleyMadison.com. MarketWatch searched through the email addresses, as provided by Graham, who owns Atlanta-basedErrata Security, and found at least 665 emails associated with big banks.
The Hill reported that the leak appears to include more than 15,000 government and military emails.
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Law360, New York (August 20, 2015, 12:11 PM ET) — The Federal Deposit Insurance Corp. on Wednesday sued Citibank NA and U.S. Bank NA alleging they failed in their roles as trustees for residential mortgage-backed securities held by a failed bank that contributed to a $695 million loss to the regulator’s insurance fund.
The FDIC was hit with RMBS losses totaling $695 million after taking over Guaranty Bank in 2009, according to three suits filed against the securities’ trustees. (Credit: FDIC) The complaints, filed in federal district court in Manhattan, came soon after a late filing…