Daily Archives: December 3, 2015

Wells Fargo loses bid to fight class status in overdraft lawsuits

 

A federal appeals court has rejected a bid by Wells Fargo to set aside class certification of three lawsuits accusing it of collecting millions of dollars in improper overdraft fees from vulnerable customers across the country.

The decision on Tuesday from the 11th U.S. Circuit Court of Appeals leaves Wells facing potentially millions of class members suing over the bank’s alleged practice of manipulating checking account transactions to increase overdrafts and boost its fee revenue.

To read the full story on WestlawNext Practitioner Insights, click here: bit.ly/1NpFTAE
Read more at Reuters http://www.reuters.com/article/2015/12/02/wellsfargo-overdrafts-idUSL1N13R38S20151202#1ZzLjvCw2gOKZ4II.99

Franklin American Mortgage fined $70 million for False Claims Act violations

Franklin American Mortgage Company will pay the United States $70 million to settle allegations brought against the lender by the Department of Justice, which accused Franklin American of violating the False Claims Act by originating substandard Federal Housing Administration loans.

According to the Department of Justice, Franklin American “knowingly” originated mortgages that did not meet the FHA loan requirements.

Read on.

The Large Bank Stranglehold is Tightened!

continue to tell my audiences the large banks have a “stranglehold” on our country and that “The Dodd-Frank provisions attempting to place controls on the large banks have been systematically gutted …”
As 2015 comes to a close all eyes in Washington D.C. are looking at a critical deadline which looms over Congress, our ever problematic funding bill, and evidence of that “stranglehold” is again revealed.
Last year, our largest banks lobbied hard to get provisions passed in the year-end funding bill that would give them more latitude to forge ahead with risky trading. This move, largely engineered by Citigroup, was a provision that partially gutted the Dodd-Frank prohibition against the TBTF banks using insured depositors’ money to gamble with risky derivatives.
The Dodd-Frank regulation was intended to hold banks accountable by mandating they establish subsidiary companies to do their trading using their own money; not federally insured deposits. The provision, jammed through Congress at the last minute in 2014, eliminated these rules so that this kind of risky financial trading could be kept within the banks.
Regards,
Richard

JPMorgan, BofA, Citigroup Among Eight U.S. Banks Cut by S&P

JPMorgan Chase & Co., Bank of America Corp. and Citigroup Inc. are among eight large U.S. banks that had credit grades cut one level by Standard & Poor’s on the prospect that the U.S. government is less likely to provide aid in a crisis.

After signaling the move last month, S&P lowered its long-term issuer credit, senior unsecured, and nondeferrable subordinated debt ratings, according to a statement Wednesday. Firms affected also include Wells Fargo & Co., Goldman Sachs Group Inc., Morgan Stanley, Bank of New York Mellon Corp. and State Street Corp.

Read on.

J.P. Morgan hired family, friends of Chinese execs for nine out of 12 IPOs

China Economic Review:

J.P. Morgan Chase & Co. hired the family and friends of executives at nine out of 12 major Chinese companies it took public from 2004 to 2013, The Wall Street Journal reported, citing a document compiled by the bank to submit to US investigators in April as part of a federal bribery investigation. The document lists 222 candidates hired by the bank under a program known internally as “Sons and Daughters,” and names the people who referred them—the most detailed accounting yet of the overlap between the program and the bank’s business in China. listings included Agricultural Bank of China (US$22 billion), China railway group (US$5.9 billion) and CGN Power (US$3.6 billion)