Daily Archives: April 15, 2016

Freedom Mortgage to pay $113 million for FHA violations

Freedom Mortgage Corporation now has more in common with Wells Fargo,Franklin American Mortgage, Walter Investment, and First Tennessee Bankthan simply being mortgage lenders, as Freedom Mortgage is set to become the latest mortgage company to settle with the Department of Justice over alleged violations of the False Claims Act.

The Department of Justice announced Friday that Freedom Mortgage will pay $113 million for originating loans that did not meet Federal Housing Administrationunderwriting standards.

Read on.

LIVE: Bernie Sanders Vatican Press Conference After Vatican Visit 4/15/2016

All Those ‘No Aid To Puerto Rico’ Ads Are From Hedge Funds

It’s primarily hedge fund owners.

To pay back its creditors, Puerto Rico has resorted to extreme measures including delaying tax refunds to its citizens, increasing sales tax by more than 50%, and instituting massive cuts to education, healthcare, and social services. Unsurprisingly, Puerto Rico’s most disenfranchised populations (including Medicaid and Medicare enrollees, incarcerated people, and families with special needs children) are shouldering the burden of those measures.

The crisis is driving more Puerto Ricans off the island and onto the mainland, fueling an ongoing “population swap” in which unemployed, young Puerto Ricans leave the island in search of work, while hundreds of wealthy Americans move onto to the island because the “Millionaire’s Law” and other policies have turned it into a “fiscal paradise” for the wealthy. Indeed, 10% of the island’s population has left in the last ten years and today as many as 3,000 Puerto Ricans are fleeing each week. This massive depopulation has eroded the availability of services in Puerto Rico and shrunk its tax base, which the government relies on to pay for pensions, services, and its debt.

Meanwhile, wealthy financiers are flocking to the island to take advantage of tax exemptions and cuts on corporate taxes, personal income, and capital gains. At a recent investment conference, billionaire hedge fund manager John Paulson predicted Puerto Rico would become the “Singapore of the Caribbean” –that is, an extremely wealthy tax haven.

This report details how, in order to pay back its creditors, the Puerto Rican government has implemented a severe austerity budget that is is creating a humanitarian crisis on the island and threatening Puerto Ricans’ access to basic services including healthcare, education, and even electricity.

Meanwhile, the hedge funds that reportedly own nearly 50% of Puerto Rico’s debt continue using vulture tactics to win as big a payday as possible at the expense of Puerto Ricans.

And it is the dark money group behind the ads to deceive the people…From Sunlight Foundation:

According to Sunlight Foundation’s Political Ad Sleuth tool, a 501(c)(4) dark money group called the Center for Individual Freedom (CFIF) has purchased at least $200,000 in ads in the Washington, D.C., market, an attempt to influence lawmakers crafting economic legislation to assist Puerto Rico’s dire financial situation. The territory is currently struggling under enormous debt obligations and is seeking help from Congress and the federal government.

On March 29, Rep. Rob Bishop, R-Utah, chairman of the House Natural Resources Committee, released a discussion draft of legislation aimed at helping Puerto Rico deal with its debt crisis. Bishopstated the draft legislation “provides Puerto Rico with tools to impose discipline over its finances, meet its obligations and restore confidence in its institutions.”

According to its website, CFIF’s mission is “to protect and defend individual freedoms and individual rights guaranteed by the U.S. Constitution.” In a press release, CFIF says it opposes the draft legislation and plans to run a national ad campaign opposing what it calls “Super Chapter 9” bankruptcy. We don’t know how much is also being spent on Internet ads or on cable, satellite and radio advertisements.

Because CFIF is a dark money group that is not required to disclose its donors, we also don’t know who is funding the ad buys. According to Internal Revenue Service documents obtained byOpenSecrets, Crossroads GPS — another dark money group tied to Karl Rove — gave almost $5 million to CFIF since 2011.

The biggest lenders are imposing strict purity tests on would-be borrowers

Saint Jamie imposes strict purity tests on would-be mortgagees.

As a reminder from wallstreetonparade.com:

Federal Reserve released a 19-page letter that it and the FDIC had issued to Jamie Dimon, the Chairman and CEO of JPMorgan Chase, on April 12 as a result of its failure to present a credible plan for winding itself down if the bank failed. The letter carried frightening passages and large blocks of redacted material in critical areas, instilling in any careful reader a sense of panic about the U.S. financial system.


Nearly eight years after the subprime bubble burst, dragging the U.S. economy and much of the global financial system down with it, America’s big banks want you to know that all that dirty business is behind them.

“If we had our druthers, we would never service a defaulted mortgage again,” J.P. Morgan Chase & Co. CEO Jamie Dimon wrote in his annual letter to bank shareholders this week.

J.P. Morgan JPM, -1.29% is offering less than half the types of mortgages it once did, Dimon added, and the bank is “dramatically” reducing the number of Federal Housing Administration-backed mortgages it extends.
That’s in part because the government has made it onerous for banks to do FHA lending, Dimon wrote. But it’s also “too costly and too risky” to offer such loans, which allow down payments of as little as 3.5% and have less stringent requirements.

The amount of mortgage credit the bank lent dropped for the second straight quarter, down marginally to $22.4 billion from $22.5 billion in the last three months of 2015. But that’s 25% lower than the $29.9 billion of mortgage originations it booked in the third quarter of last year.


Panama Papers reveal shell companies linked to Africa’s richest man

Worth a staggering $15.4-billion, Nigerian businessperson and industrialist Aliko Dangote is on the Forbes rich list as the wealthiest man in Africa. But does Dangote pay his fair share of tax in Nigeria, or is he hiding assets abroad? That remains unclear. Yet that question has become even more relevant following discoveries of several secret shell companies linked to him, his allies and his relatives.

According to the leaked internal data of Panama-based offshore legal services provider Mossack Fonseca, obtained by the German newspaper Süddeutsche Zeitung and shared by the International Consortium of Investigative Journalists (ICIJ), Dangote, his half-brother and his business allies have over the years used shell companies domiciled in controversial tax havens in their business transactions.

The unprecedented year-long investigation involving 11.5-million secret documents – which date from 1977 to December 2015 –has exposed the hidden underground of the world economy: a network of banks, law firms and other middlemen that use shell companies, sometimes to hide illegal wealth.

Read on.

Barack Obama Never Said Money Wasn’t Corrupting; In Fact, He Said the Opposite

Character is born within the soul. It is buried the day you sell it.

DURING THURSDAY’S DEMOCRATIC debate in Brooklyn, Bernie Sanders asked this question about Hillary Clinton: “Do we really feel confident about a candidate saying that she’s going to bring change in America when she is so dependent on big money interests?”

Clinton’s response was to invoke Barack Obama. “Make no mistake about it, this is not just an attack on me, it’s an attack on President Obama,” she said. “President Obama had a Super PAC when he ran. President Obama took tens of millions of dollars from contributors. And President Obama was not at all influenced when he made the decision to pass and sign Dodd-Frank, the toughest regulations on Wall Street in many a year.”

The message was that it is possible not to be corrupted by big money, and neither she nor Obama had succumbed to its influence.

But Obama has never said he was incorruptible. In fact, in his 2006 book, The Audacity of Hope, he eloquently described the subtle but real corrupting effect the fundraising process has on politicians, including himself:

I can’t assume that the money chase didn’t alter me in some ways. …

Increasingly I found myself spending time with people of means — law firm partners and investment bankers, hedge fund managers and venture capitalists. As a rule, they were smart, interesting people, knowledgeable about public policy, liberal in their politics, expecting nothing more than a hearing of their opinions in exchange for their checks. But they reflected, almost uniformly, the perspectives of their class: the top 1 percent or so of the income scale that can afford to write a $2,000 check to a political candidate. They believed in the free market and an educational meritocracy; they found it hard to imagine that there might be any social ill that could not be cured by a high SAT score. They had no patience with protectionism, found unions troublesome, and were not particularly sympathetic to those whose lives were upended by the movements of global capital. Most were adamantly prochoice and antigun and were vaguely suspicious of deep religious sentiment.

And although my own worldview and theirs corresponded in many ways — I had gone to the same schools, after all, had read the same books, and worried about my kids in many of the same ways — I found myself avoiding certain topics during conversations with them, papering over possible differences, anticipating their expectations. On core issues I was candid; I had no problem telling well-heeled supporters that the tax cuts they’d received from George Bush should be reversed. Whenever I could, I would try to share with them some of the perspectives I was hearing from other portions of the electorate: the legitimate role of faith in politics, say, or the deep cultural meaning of guns in rural parts of the state.

Still, I know that as a consequence of my fund-raising I became more like the wealthy donors I met, in the very particular sense that I spent more and more of my time above the fray, outside the world of immediate hunger, disappointment, fear, irrationality, and frequent hardship of the other 99 percent of the population — that is, the people that I’d entered public life to serve. And in one fashion or another, I suspect this is true for every senator: The longer you are a senator, the narrower the scope of your interactions. You may fight it, with town hall meetings and listening tours and stops by the old neighborhood. But your schedule dictates that you move in a different orbit from most of the people you represent.

And perhaps as the next race approaches, a voice within tells you that you don’t want to have to go through all the misery of raising all that money in small increments all over again. You realize that you no longer have the cachet you did as the upstart, the fresh face; you haven’t changed Washington, and you’ve made a lot of people unhappy with difficult votes. The path of least resistance — of fund-raisers organized by the special interests, the corporate PACs, and the top lobbying shops — starts to look awfully tempting, and if the opinions of these insiders don’t quite jibe with those you once held, you learn to rationalize the changes as a matter of realism, of compromise, of learning the ropes. The problems of ordinary people, the voices of the Rust Belt town or the dwindling heartland, become a distant echo rather than a palpable reality, abstractions to be managed rather than battles to be fought.

Source: The Intercept

The Fed Sends A Frightening Letter To JPMorgan, Corporate Media Yawns

Submitted by Pam Martens and Russ Martens via WallStreetOnParade.com,

Yesterday the Federal Reserve released a 19-page letter that it and the FDIC had issued to Jamie Dimon, the Chairman and CEO of JPMorgan Chase, on April 12 as a result of its failure to present a credible plan for winding itself down if the bank failed.The letter carried frightening passages and large blocks of redacted material in critical areas, instilling in any careful reader a sense of panic about the U.S. financial system.

A rational observer of Wall Street’s serial hubris might have expected some key segments of this letter to make it into the business press. A mere eight years ago the United States experienced a complete meltdown of its financial system, leading to the worst economic collapse since the Great Depression. President Obama and regulators have been assuring us over these intervening eight years that things are under control as a result of the Dodd-Frank financial reform legislation. But according to the letter the Fed and FDIC issued on April 12 to JPMorgan Chase, the country’s largest bank with over $2 trillion in assets and $51 trillion in notional amounts of derivatives, things are decidedly not under control.

At the top of page 11, the Federal regulators reveal that they have “identified a deficiency” in JPMorgan’s wind-down plan which if not properly addressed could “pose serious adverse effects to the financial stability of the United States.” Why didn’t JPMorgan’s Board of Directors or its legions of lawyers catch this?

It’s important to parse the phrasing of that sentence. The Federal regulators didn’t say JPMorgan could pose a threat to its shareholders or Wall Street or the markets. It said the potential threat was to “the financial stability of the United States.”

Sen. Sanders at Vatican Blasts Banks, ‘Citizens United’

(CN) – Sen. Bernie Sanders told attendees at a Vatican conference on Friday that the challenge facing the planet are “not mainly technological or even financial.”
Instead, he said, they are mostly moral, and the time has come “to redirect our efforts and vision to the common good.”
Sanders arrived in Rome just hours after Thursday night’s Democratic presidential candidate debate in Brooklyn, N.Y.
He was one of several speakers invited to the conference organized by the Pontifical Academy of Social Science.
The event is commemorating the 25th anniversary of “Centesimus Annus,” a document authored by Pope John Paul II on economics and social justice in the aftermath of the Cold War.
In his prepared remarks, Sanders called “Centesimus Annus” and “Laudato Si’,” an encyclical in which Pope Francis critiqued consumerism, irresponsible development and lack of concern for the effects of climate change, “powerful, eloquent and hopeful messages of this possibility.”
“It is up to us to learn from them, and to move boldly toward the common good in our time,” Sanders said in his prepared remarks, a copy of which was released by his campaign Friday morning.
Although Sanders made no direct reference to his quest for the Democratic presidential nomination, the majors themes of his campaign did make it into his text.
“Inexplicably, the United States political system doubled down on this reckless financial deregulation, when the U.S. Supreme Court in a series of deeply misguided decisions, unleashed an unprecedented flow of money into American politics,” the Vermont senator said. “These decisions culminated in the infamousCitizen United case, which opened the financial spigots for huge campaign donations by billionaires and large corporations to turn the U.S. political system to their narrow and greedy advantage.”
Sanders said Citizens United established a system in which billionaires can buy elections in the United States.
“Rather than an economy aimed at the common good, we have been left with an economy operated for the top 1 percent, who get richer and richer as the working class, the young and the poor fall further and further behind,” he said.
Sanders continued: “The billionaires and banks have reaped the returns of their campaign investments, in the form of special tax privileges, imbalanced trade agreements that favor investors over workers, and that even give multinational companies extra-judicial power over governments that are trying to regulate them.”

Read on.

And here is Sanders’ prepared remarks. Click here.

New York Daily News editorial board should have given the same questions to the 3 Presidential candidates interviews

New York Daily News editorial board interviewed Clinton, Kasich, and Sanders. Interesting questions but different responses in regarding to Wall Street reform and why there are no prosecutions from DOJ to bank execs. Kasich, who was interviewed on 4/7/16 was not asked any questions on Wall Street. Here is the link to Kasich’s interview:


Here is snippet from Sanders’ interview on April 1:

Daily News: Okay. Staying with Wall Street, you’ve pointed out, that “not one major Wall Street executive has been prosecuted for causing the near collapse of our entire economy.” Why was that? Why did that happen? Why was there no prosecution?

Sanders: I would suspect that the answer that some would give you is that while what they did was horrific, and greedy and had a huge impact on our economy, that some suggest that…that those activities were not illegal. I disagree. And I think an aggressive attorney general would have found illegal activity.

Daily News: So do you think that President Obama’s Justice Department essentially was either in the tank or not as…

Sanders: No, I wouldn’t say they were in the tank. I’m saying, a Sanders administration would have a much more aggressive attorney general looking at all of the legal implications. All I can tell you is that if you have Goldman Sachs paying a settlement fee of $5 billion, other banks paying a larger fee, I think most Americans think, “Well, why do they pay $5 billion?” Not because they’re heck of a nice guys who want to pay $5 billion. Something was wrong there. And if something was wrong, I think they were illegal activities.

Daily News: Okay. But do you have a sense that there is a particular statute or statutes that a prosecutor could have or should have invoked to bring indictments?

Sanders: I suspect that there are. Yes.

Daily News: You believe that? But do you know?

Sanders: I believe that that is the case. Do I have them in front of me, now, legal statutes? No, I don’t. But if I would…yeah, that’s what I believe, yes. When a company pays a $5 billion fine for doing something that’s illegal, yeah, I think we can bring charges against the executives.

Daily News: I’m only pressing because you’ve made it such a central part of your campaign. And I wanted to know what the mechanism would be to accomplish it.

Sanders: Let me be very clear about this. Alright? Let me repeat what I have said. Maybe you’ve got a quote there. I do believe that, to a significant degree, the business model of Wall Street is fraud.

And you asked me, you started this discussion off appropriately enough about when I talk about morality. When I talk about it, that’s what I think. I think when you have the most powerful financial institutions in this country, whose assets are equivalent to 58% of the GDP of this country, who day after day engage in fraudulent activity, that sets a tone.

That sets a tone for some 10-year-old kid in this country who says, “Look, these people are getting away from it. They’re lying. They’re cheating. Why can’t I do that?”

Daily News: What kind of fraudulent activity are you referring to when you say that?

Sanders: What kind of fraudulent activity? Fraudulent activity that brought this country into the worst economic decline in its history by selling packages of fraudulent, fraudulent, worthless subprime mortgages. How’s that for a start?

Selling products to people who you knew could not repay them. Lying to people without allowing them to know that in a year, their interest rates would be off the charts. They would not repay that. Bundling these things. Putting them into packages with good mortgages. That’s fraudulent activity.

Sanders’ could have used the advice of William K. Black, now his economic advisor, to answer those questions on why there is no prosecution from DOJ to Wall Street bank execs. Better yet, why two DOJ heads (Holder and Lynch) under the Obama Administration can’t prosecute one big bank execs  (even though Wells Fargo and Goldman Sachs recent settlements with the DOJ did admit their wrongdoings but was never charged criminally) and continue to use deferred non-prosecution agreements and settlements. Yes, stature of limitations to the securitization mortgages is one of the key problems. 

And here is a snippet of  Clinton’s interview on April 9:

Daily News: How do you stop too big to fail? What needs to happen?

Clinton: Well, I have been a strong supporter of Dodd-Frank because it is the most consequential financial reforms since the Great Depression. And I have said many times in debates and in other settings, there is authority in Dodd-Frank to break up banks that pose a grave threat to financial stability.

There are two approaches. There’s Section 121, Section 165, and both of them can be used by regulators to either require a bank to sell off businesses, lines of businesses or assets, because of the finding that is made by two-thirds of the financial regulators that the institution poses a grave threat, or if the Fed and the FDIC conclude that the institutions’ living will resolution is inadequate and is not going to get any better, there can also be requirements that they do so.

So we’ve got that structure. Now a lot of people have argued that there need to be some tweaks to it that I would be certainly open to. But my point from the very beginning of this campaign, and it’s something that I’ve said repeatedly: big banks did not cause the Great Recession primarily. They were complicit, but hedge funds; Lehman Brothers, an investment bank; a big insurance company, AIG; mortgage companies like Countrywide, Fannie and Freddie — there were lots of culprits who were contributing to the circumstances that led to the very dangerous financial crisis.

Daily News: Should some of those culprits have been prosecuted, and in prison, successfully? Does that rankle you?

Clinton: Well, it rankles me that I don’t believe we had sufficient laws, sufficient prosecutorial resources to really go after what could have been not just dangerous, unethical behavior but perhaps illegal behavior. I’ve talked with some of the people responsible for trying to determine whether there could be cases brought. And they were totally outresourced.

We haven’t adequately resourced the regulators — SEC, Commodity Futures Trading Commission, FDIC — and we have not sufficiently resourced the Justice Department and U.S. attorneys to have the expertise and the ability to go after anything they sought.

Daily News: There’s two slightly different questions. One is, was it a problem of law or was it a problem of prosecutors not being sufficiently resourced?

Clinton: The prosecutors tell me it was the problem of the law. Other analysts, as you well know, have said that there could have been more vigorous efforts that might have led to prosecutions. Now there were cases brought in some of the mortgage companies. There’s also a problem with the statute of limitations, because these are difficult cases to bring. They take a long time. I think we should certainly extend the statute of limitations.

So I’m not going to second-judge people who I believe were acting in good faith, because I think they were — U.S. attorneys, Department of Justice prosecutors. But they concluded that they could not make cases. So I think we have to have a very robust analysis of what were the real reasons they couldn’t make cases. Are the laws insufficient? Therefore how do we try to make them tougher as a deterrent and make it clear to people in the financial services industry that there’s a new sheriff in town so that there will be additional legal requirements and we will resource better.

So I think we have to take a hard look at this, and I believe we can do that.

A question that was not asked to Sanders and Clinton that should have been asked is how is Sanders and Clinton going to make sure the Volcker Rule goes into effect for the banks if either one is President. The Volcker rule has been extended to 2017 thanks to Congress, the banks ,and the bank lobbyists pushing back the law into going in effect.

Here we go again!! New Century wants the destruction of all records!! Fwd: In re New Century TRS Holdings, Inc. Case No. 07-10416

An email message from Virginia from Deadly Clear website:

Blast this out to everyone you know – it might be the last time to obtain their New Century file. There is valuable information in these files –and since they are files that deal with the homeowner and where their collateral may be located – even if you are not in foreclosure it maybe imperative that you know in the future what happened to your file.  I did a post the last time – See: http://wp.me/p1H9BR-TN and it has all of the pertinent information. I’ll try to get another one up but in the meantime please share this with your email lists so that we can get the alert out!  Thanks to Anita Carr for keeping us briefed.

And here is the recently filed in the bankruptcy proceedings of New Century TRS Holdings, Inc, Jointly Administered under Case No. 07-10416 (District of Delaware):