Daily Archives: October 3, 2015

Countrywide COO who took rap for 2008 crisis prepares her appeal

Rebecca Mairone scarcely deserves a mention in the annals of finance, except for this: She’s the only executive of a major U.S. mortgage lender found liable for her part in the 2008 financial crisis.

Mairone was chief operating officer for a division of Countrywide Financial Corp., the California giant that came to symbolize the excesses of the subprime era. While top executives there and elsewhere walked away, Mairone, now 48, was targeted in a civil case by federal prosecutors. In October 2013, a Manhattan jury found her liable for misrepresenting the quality of mortgages her company sold to Fannie Mae and Freddie Mac. U.S. District Judge Jed Rakoff called her testimony “implausible” and slapped her with a $1 million fine. Bloggers said she helped destroy the U.S. economy and should be jailed or worse.

Two years later, Mairone is heading back to court in an attempt to overturn that ruling and restore her reputation. As she has all along, she maintains she did nothing wrong. Years after the housing bust, her case reminds Americans yet again that not a single senior executive has been held accountable for a mortgage meltdown that cost millions of people their homes, livelihoods and savings.

Read on.

Wells Fargo’s Master Spin Job

Reporters and politicians are lining up to congratulate Wells Fargo for its multimillion-dollar neighborhood grant program – but they’re leaving out one small detail

If you still don’t believe our brethren on Wall Street have planet-sized cojones, check out this story.

All over the country, Wells Fargo is making headlines for launching a multimillion-dollar homeowner assistance program called HomeLIFT, which among other things offers $15,000 down payment grants to prospective home-buyers.

Local mayors in big cities from one end of the country to the other are showing up at ribbon-cuttings and throwing rose petals at the bank for its generosity. Newspapers in turn are running breathless profiles of the low-income homeowners who will now get to buy dream homes thanks to the bank’s beneficence.

Some knew, some didn’t, but all are leaving out one key detail: Wells Fargo was forced to launch HomeLIFT.

To understand the background, we have to go back to July 25th of last year, when a federal judge in the Northern District of California approved a settlement in a case called City of Westland Police and Fire Retirement System v. Stumpf. The suit was brought on behalf of shareholders by Robbins Geller, the same firm featured in a story I wrote two years ago about the ratings agencies.

For those who are fortunate enough to have forgotten, robo-signing was a common practice that devastated families during the foreclosure crisis. People all over the country found themselves booted out of their homes thanks to bogus affidavits signed by “vice presidents” and “regional managers,” who were often scraggly kids just out of college blindly signing hundreds of documents a day, if not more.

Read more: http://www.rollingstone.com/politics/news/wells-fargos-master-spin-job-20151002#ixzz3nTgnM4q1