Tag Archives: bank

 The Government Wouldn’t Rein In the Banks’ Predatory Practices—Until These Tellers Stepped In

The Nation:

As with the toppling of any Goliath, the elevation of Wells Fargo’s fraudulent scheme into a high-profile national scandal didn’t happen by accident. Rather, a growing national coalition called the Committee for Better Banks, or CBB, spread the word—and then ratcheted up the pressure.

Since 2013, at least, the CBB has labored assiduously to turn bank workers and consumers into a force capable of combating Wall Street’s predatory practices. A project of the Communications Workers of America (CWA) and numerous community organizations, the group was born from a recognition that front-line bank workers—tellers, personal bankers, and other branch-level employees—have an enormous potential to change the consumer-banking industry in this country. As the people who deal with customers directly, these workers can see and sympathize with the real-life impact of abusive lending and retail tactics. Moreover, as people who are themselves exploited by the banks—while Stumpf made as much as $19.3 million a year during his time as CEO, bank tellers earn a median wage of $12.44 an hour, according to the National Employment Law Project—they and their customers have a common cause.

Trump labor nominee Puzder owes millions to bank seeking waiver from his department

Update 2/12, 1:30 pm ET:  After this story was published, Andrew Puzder spokesman George Thompson got back in touch with IBT to assert that, after the sale of his house, the Labor Secretary nominee currently has “a little more than $900,000” in debt to UBS, despite the financial disclosure forms that Puzder recently filed. The story has been updated to reflect the later assertion.

Original story: President Donald Trump’s nominee to head the U.S. Department of Labor personally owed millions of dollars to a convicted bank that is relying on the same department to waive sanctions for its crimes, according to federal records. The ties between Trump’s embattled appointee Andrew Puzder and the multinational bank UBS were listed in federal documents reviewed by International Business Times — but they were not explicitly acknowledged in Puzder’s ethics agreement with federal regulators.

Read on.

Midwest Bank officials, FDIC in settlement for $26.5 million over loans

Eighteen former Midwest Bank officers and directors will pay a total of $26.5 million to the Federal Deposit Insurance Corp. to settle a 2013 lawsuit alleging that their negligence in lending to risky borrowers contributed to losses at the failed institution.

Midwest Bank, based in Elmwood Park, was a $3.17 billion-asset lender that was among the first community banks to get federal bailout funds after the financial crisis erupted. It was part of Midwest Banc Holdings, which had been a publicly traded banking company, and was seized by regulators in 2010. It was among the largest local banks to fail after the financial crisis.

The FDIC occasionally sues executives of banks that collapse. The Midwest Bank lawsuit was filed in U.S. District Court in Chicago.

Read on.

Black-owned Atlanta bank sees 8,000 new accounts after rapper’s shoutout

Impressive word of mouth…

Citizens Trust, a black-owned bank in Atlanta, has seen more than 8,000 people open new accounts over five days after activist and hip-hop star Killer Mike urged black Atlantans to open up accounts at the community lender.

There’s been a “huge influx” of new customers since the rapper, who previously stumped for Bernie Sanders, name-checked the business on Hot 107.9, an Atlanta radio station, Diedra St. Julien, Citizens Trust’s marketing director, told The Post.

“This movement brought awareness to the importance of community banks, and the strength of community banks, inside the communities they support,” she said.

Read on.

 

Former bank president facing life in jail for bank fraud, real estate fraud

The former president and chairman of a failed Oklahoma bank could spend the rest of his life in federal prison, after a jury found him guilty of a series of fraud charges that involved personally approving fraudulent loans for real estate and other investments.

According to the U.S. Attorney’s Office for the Western District of Oklahoma, Paul Doughty, 67, the former president and chairman of First State Bank of Altus, was found guilty last week of 10 charges of bank fraud, conspiracy to commit bank fraud, misapplication of bank funds, making a false bank entry and unauthorized issuance of a bank loan in connection with First State Bank and various loan schemes.

Read on.

When Santa Was a Bank

766_001

It’s bonus season, and while many in the junk bond market should expect coal in their stocking, the rest of Wall Street remains hopeful that Santa Claus remembers them this year. Given the Fed’s rate hike, though, more than a few financiers are losing faith.

It would help, perhaps, if Wall Street had a direct line to Santa Claus. Once upon a time, it did. For much of the 19th century, Santa Claus had a branch office at No. 12 Wall Street. This was the “Saint Nicholas Bank,” established in 1853 and capitalized at $500,000.

The origins of the Saint Nicholas Bank are a bit murky. Aside from the fact that it built a safe that Bankers’ Magazine described in 1854 as “the largest in the United States, if not the world,” the new institution attracted very little notice.

At this time, state-chartered banks in the United States issued their own currency, in denominations and designs of their choice. This system of private money creation flourished before the Civil War, with nearly 2,000 banks printing their own currency by the end of the 1850s.

The Saint Nicholas Bank printed money illustrated with – who else? – Santa Claus. The $1 and $3 bills showed Santa popping out of the fireplace to tend to children’s stockings. The big man was depicted in various poses in his reindeer-drawn sleigh on the $2, $5, and $10. The $20 and $50 showed the jolly old elf popping out of another fireplace, with sleeping children tucked into a bed a few feet away. (The rarely seen $100 note, by contrast, showed the U.S. Capitol building – so much for holiday cheer).

Still, why would Santa Claus adorn a bank note? The answer lies with the deeper history of New York City business and finance, and possibly, the man who would loom the largest over the bank’s reputation.

The very distant ancestor of Santa Claus was the real-life Saint Nicholas, for whom the bank was undoubtedly named. Born in what is now Turkey, the original Saint Nicholas became the patron saint of sailors thanks to his alleged ability to calm storms. His benevolence toward children made him the patron saint of that set, too.

Read on.

Nebraska Bank CEO Convicted for Masking Huge Loan Losses

The former chief executive of a Nebraska bank was convicted Friday by a federal jury for lying to investors and regulators about considerable losses tied to risky commercial real estate investments.

Gilbert Lundstrom, 74, led TierOne Bank to make hazardous investments, including construction projects in Las Vegas, resulting in loan and property valuation losses of more than $100 million in the aftermath of the financial crisis, according to a Justice Department announcement.

Then Lundstrom and other executives at the $3 billion publicly traded company concealed the losses to investors for more than a year, according to authorities. They did not disclose in financial statements that the Lincoln, Neb., bank needed $34 million to $114 million in additional reserves and loan loss allowance after finding out about the requirement in April 2009. And in a May 2009 annual shareholder meeting, Lundstrom did not clearly reveal the state of the bank’s capital ratios and reserves to investors, nor that it had asked for Troubled Asset Relief Program assistance, regulators contend.

By the end of the year, TierOne Bank had disclosed $120 million in loan losses to its shareholders, according to the Lincoln Journal Star. The 750-employee, 69-branch bank was delisted from the Nasdaq, and then shut down by the Federal Deposit Insurance Corp. in June 2010, the announcement said.

Read on.