As Paperwork Goes Missing, Private Student Loan Debts May Be Wiped Away

Tens of thousands of people who took out private loans to pay for college but have not been able to keep up payments may get their debts wiped away because critical paperwork is missing.

The troubled loans, which total at least $5 billion, are at the center of a protracted legal dispute between the student borrowers and a group of creditors who have aggressively pursued them in court after they fell behind on payments.

Judges have already dismissed dozens of lawsuits against former students, essentially wiping out their debt, because documents proving who owns the loans are missing. A review of court records by The New York Times shows that many other collection cases are deeply flawed, with incomplete ownership records and mass-produced documentation.

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Minneapolis City Council members urge JPMorgan Chase to cut Trump ties

Minneapolis City Council members are calling for JPMorgan Chase to sever its ties with the Trump administration and divest from private prisons and immigration detention centers, the latest move by city leaders to push against the administration from a local level.

Council Members Elizabeth Glidden, Cam Gordon and Lisa Bender sent a letter to JPMorgan Chase CEO Jamie Dimon on June 27 calling for the bank to withdraw from President Donald Trump’s business council, issue a statement against Trump’s “anti-immigrant, refugee and Muslim agenda” and stop financing private prison companies and immigration detention centers.

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Trump’s tax proposal would push US below Greece on inequality index

United States is ranked 23. Sweden is #1.

  • Researchers say tax reform plan would increase gap between rich and poor
  • US already does ‘very badly’ on global inequality index

Donald Trump’s tax reform plans would, if enacted, increase the gap between rich and poor Americans and see the US slip below Greece on a new global index of inequality.

According to the Commitment to Reducing Inequality (CRI) index, developed by researchers at Oxfam and Development Finance International, the US already distinguishes itself among wealthy countries by doing “very badly” at addressing inequality.

But it would fall a further six places from its ranking of 23rd overall if Trump’s tax reform effort is successful, with the US’s specific rating on tax policies plummeting 33 places from 26th to 59th – just below Peru, Chile and Sri Lanka.

“When you already have countries like Portugal and Slovenia ranking higher than the United States on the overall index, we think that’s a concern considering the wealth of the US,” Paul O’Brien, Oxfam America’s vice-president for policy and campaigns, told the Guardian.

If the White House passes its budget, which would slash social service spending and could leave millions of Americans without health insurance, the US would fall behind Greece, which is crippled by a debt crisis; Spain, which for 10 months in 2016 did not have a government; and Argentina, which has been plagued by high inflation, according to the report.

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Here’s why Wall Street has a hard time being ethical

This article was a few years ago but nothing has changed today…

A new report finds 53% of financial services executives say that adhering to ethical standards inhibits career progression at their firm. A former Wall Street trader describes why

My first year on Wall Street, 1993, I was paid 14 times more than I earned the prior year and three times more than my father’s best year. For that money, I helped my company create financial products that were disguised to look simple, but which required complex math to properly understand. That first year I was roundly applauded by my bosses, who told me I was clever, and to my surprise they gave me $20,000 bonus beyond my salary.

The products were sold to many investors, many who didn’t fully understand what they were buying, most of them what we called “clueless Japanese.” The profits to my company were huge – hundreds of millions of dollars huge. The main product that made my firm great money for close to five years was was called, in typically dense finance jargon, a YIF, or a Yield Indexed Forward.

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Wells Fargo Lost ‘Tens of Millions’ in Muni and State Deals After Scandal

Wells Fargo & Co. has lost “tens of millions of dollars” in revenue from municipal and state clients since a sales scandal in its consumer bank erupted 10 months ago, Chief Financial Officer John Shrewsberry said.

Shrewsberry said the decline isn’t material to Wells Fargo’s earnings, but added the company is working to regain the business. Ancel Martinez, a spokesman for the San Francisco-based lender, said the lost revenue is expected to be $20 million to $30 million for 2017.

“I don’t want to downplay it,” Shrewsberry said Friday in a telephone interview. “If we’ve irritated those customers, we want to compete and demonstrate to them how we’ve made things better and win their business back.”

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Wells Fargo to reduce businesses following fake account scandal: FT

(Reuters) – Wells Fargo is poised to eliminate a number of its smaller businesses, the company’s chief financial officer said in an article published Sunday.

The Financial Times reported that Wells Fargo will be spinning off a number of its products “worth hundreds of millions of dollars,” according to CFO John Shrewsberry, in order to focus on and emphasize “more relevant” ones, though he did not specify what products those would be.

“There are a handful of businesses in our mindset,” Shrewsberry said, adding that the bank had “choices to make.” “They’re not at the scale of most of our businesses . . . not top-tier providers.”

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The Department of Labor new rule: Financial advisor trap

ONE OF THE most important investor protections in decades took effect on June 9. The new rule, issued by the Department of Labor, sets in motion a seemingly commonsense requirement that those who advise on retirement investments must put their clients’ interests ahead of their own. Yet it marks a revolution in retirement security, the result of an epic seven-year battle between consumer advocates and the financial industry that sunk millions of dollars into white shoe lobbying firms, industry-sponsored studies, congressional campaign contributions, and major lawsuits in an effort to block the rule.

“Investment advisers shouldn’t be able to steer retirees, workers, small businesses, and others into investments that benefit the advisers at the expense of their clients,” Assistant Labor Secretary Phyllis Borzi, who developed the rule, said in 2011. “The consumer’s retirement security must come first.”

The rule, finalized in April 2016, was scheduled to take effect a year later in order to give firms time to comply. It only survived till now thanks to a veto by President Obama of legislation that would have permanently blocked its implementation; Rep. Paul Ryan, who led the charge in Congress, had tarred the rule as “Obamacare for financial planning.”

Since the rule was already final when President Trump took office, it was invulnerable to his day one directive freezing all pending rule making. Nevertheless, within two weeks Trump signed a memo directing the DOL to review the rule and potentially rescind it. In March, before Trump’s labor secretary had even been confirmed, the Department of Labor issued a proposed rule delaying implementation for 60 days — bringing us to June 9 of this year.

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