Daily Archives: October 17, 2015

Class Claims Against Wells Fargo Teetering

SAN FRANCISCO (CN) – A federal judge Thursday said he does not believe Wells Fargo breached contracts or misled homebuyers, but he’s not sure he can deny borrowers class certification on that basis.
Karen and Jeffrey Lucia et al. say Wells Fargo failed to offer permanent loan modifications to homeowners who participated in the federal Home Affordable Mortgage Program from April 2009 to March 2010.
A trial period agreement required the bank to notify borrowers if they qualified for permanent loan changes within three months, the plaintiffs say.
In August 2013 the Ninth Circuit reversed dismissal of two class actions accusing Wells Fargo of offering temporary loan modifications with no intention to make them permanent. Offering borrowers permanent loan modifications was one of two conditions the bank agreed to when it accepted federal bailout money in 2008, according to the lawsuits .
On Thursday, U.S. District Judge Vince Chhabria heard two hours of arguments on a motion for class certification for three related class actions, filed the Lucias, Phillip R. Corvello and Amira Jackmon.
Plaintiffs’ attorney Thomas Loeser said Wells Fargo steered troubled borrowers into the HAMP to soak money from them, without ever intending to permanently modify their loans as promised.
“They took people that were in default and converted them into cash cows and made millions and millions of dollars,” Loeser said.

Read on.

Wells Fargo Faces Deferred-Pay Class-Action Suit

Wells Fargo is facing another lawsuit over making brokers who left the brokerage forfeit deferred pay, Financial Advisor magazine writes. This time, the company may have to settle claims from more than 100 advisors in Texas because the relevant clause in its employment agreements may violate the state’s commercial laws.

The company settled a similar claim in May, paying out $5.1 million to 133 advisors in California and North Dakota, according to court documents seen by Financial Advisor.

The new suit takes issue with the broadness of the forfeiture clause in Wells Fargo’s contribution and deferral plan. The rules place a minimum three-year limit on advisors, who would forfeit their deferred pay if they work for any other financial-service providers “anywhere in the world” — direct competitor of Wells Fargo’s retail brokerage unit or not — says the suit, filed in the U.S. District Court for the Southern District of Texas, as cited by Financial Advisor.

Read on.

Bush, Clinton are Wall Street’s favorites, donations show

NEW YORK (Reuters) – Jeb Bush is leading the U.S. presidential campaign by at least one measure: financial support from Wall Street.

The former Florida governor who is seeking the Republican presidential nomination received more financial backing than any competitor – Democrat or Republican – from employees of the major Wall Street banks between July and the end of September, campaign filings released on Thursday show.

Employees from Bank of America , Citigroup , Credit Suisse , Goldman Sachs , HSBC , JPMorgan Chase , Morgan Stanley and UBS gave Bush a combined $107,000. He also received the maximum-allowed $2,700 from billionaire hedge fund manager Leon Cooperman.

The sums are miniscule compared to Bush’s total haul for the quarter of $13.4 million. But his popularity among financiers is starkly different from his standing in the multitude of national polls.

Read on.

JPMorgan, Morgan Stanley pay most in $1.9 billion swaps price-fixing settlement

(Reuters) – JPMorgan Chase & Co, Morgan Stanley and Barclays Plc will pay over half of a more than $1.86 billion settlement resolving investor claims they conspired to fix prices and limit competition in the market for credit default swaps, according to a court filing.

Details of the settlement’s breakdown with those and nine other banks were disclosed in papers filed late on Friday, in federal court in Manhattan, a month after the proposed deal was first announced.

JPMorgan will pay $595 million, while Morgan Stanley and Barclays will pay $230 million and $178 million, respectively, according to the filings.

Read on.