Tag Archives: bank

Nationstar Shells Out $76M To End Collusion Class Action

Law360, New York (November 9, 2015, 10:08 PM ET) — A Florida federal judge Monday approved a $76 million settlement to end a class action accusing Nationstar Mortgage of colluding with force-placed insurance providers to make lucrative profits, a deal that increased by $22 million at a final fairness hearing.

Borrowers who brought the suit asked Magistrate Judge Jonathan Goodman to finalize a $54 million settlement of their class action in June, but the judge noted in Monday’s order that class counsel explained during the final fairness hearing, held in July that they now view the…

Source: Law360

Ex-Anglo Irish Bank Chief Charged With Forgery, Conspiracy

  • Dublin court seeks David Drumm’s extradition on 33 charges
  • Banker moved to U.S. six years ago after lender collapsed

Six years after moving to the U.S. following the collapse of Anglo Irish Bank Corp., its former Chief Executive Officer David Drumm may be forced to return to Ireland and face charges including forgery and conspiracy to defraud.

Thirty-three criminal counts were listed in a court document made public in Boston seeking to have Drumm, who was arrested Saturday, extradited to Ireland on warrants issued by a Dublin court. A hearing was set for 2:30 p.m. Tuesday in Boston.

The Irish government took over Anglo Irish in 2009 after bad loans soared following the worst real estate crash in Western Europe. The cost of saving the country’s banks forced the government to seek a rescue from the International Monetary Fund and European Union, and despite a 29.3 billion-euro ($33.4 billion) bailout , Anglo Irish was put in liquidation in 2013.

Irish police and corporate enforcers in February 2009 began a criminal investigation into activities at the bank before it was nationalized. Drumm was CEO from 2005 to 2008.

Drumm, who now lives in Massachusetts, resigned from the bank after revelations that Chairman Sean Fitzpatrick had quit for failing to fully disclose tens of millions euros in loans from the bank.

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Fifth Third Bank Accused of Bias in Lending

CINCINNATI (CN) – Fifth Third Bank allowed auto dealers to hike interest rates on car loans to black and Hispanic buyers, the Justice Department claims in a lawsuit.
According to a complaint filed in Federal Court on Monday, the bank’s policy was done “in a hidden manner not based on the borrower’s creditworthiness or other objective criteria related to borrower risk.”
The lawsuit says the bank’s policy was done “in a hidden manner not based on the borrower’s creditworthiness or other objective criteria related to borrower risk.”
An investigation by the Consumer Financial Protection Bureau revealed the policy has been in effect as far back as 2010.
The agency says Fifth Third’s “lack of compliance monitoring” meant “the average African-American victim was obligated to pay over $200 more during the term of the loan because of discrimination, and the average Hispanic victim was obligated to pay over $200 more during the term of the loan because of discrimination.”

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Sue Your Bank, Keep Your Home, Repeat

Inside a deeply suspect mortgage-relief operation in L.A.

Four years ago, Robert and Joan Potter were facing a crisis. The monthly payments on their two-bedroom home in the coastal suburb of Laguna Niguel, Calif., had ballooned from $2,000 to $5,000 in the decade since they bought it for about $360,000. Now the retirees were rapidly falling behind.

“It was my parents’ dream home,” said their son, Derrick, 43. Derrick, who works as a mortgage consultant, said Robert and Joan got suckered into the kind of inflationary deal known as a negative amortization loan, since outlawed by state legislators. “They had some sleazy mortgage broker who said my mom, who hasn’t worked in 25 years, made $10,000 a month.”

Still, there was hope. The Potters heard about a firm called Brookstone Law, which was pioneering a novel strategy for challenging allegedly predatory banks. The best part: As long as Brookstone was representing Robert and Joan, the bank would hold off on collecting mortgage payments or foreclosing.

In 2011, Robert and Joan paid Brookstone $6,000 to become the lead plaintiffs in a “mass joinder” lawsuit against their lender, JPMorgan Chase Bank. Similar to class actions, mass joinders allow large numbers of people to collectively sue one defendant, except that in a mass joinder the plaintiffs do not have identical claims. Settlements, if there are any, get sorted out individually, depending on each plaintiff’s circumstances.

Brookstone’s case against Chase alleged mortgage-related misconduct such as wrongful foreclosure and breach of contract. It demanded that the bank pay for lost home equity, lowered credit scores, and further damages. It claimed that when the Potters refinanced in 2006, the bank manipulated them into taking a loan they couldn’t afford and hid its true interest rate. The suit was filed in Los Angeles County Superior Court on April 15, 2011. Eventually, Brookstone signed up more than 250 clients to join it.

Casting itself as defending the little guys caught up in the subprime crisis, Brookstone, founded by a 41-year old attorney named Vito Torchia Jr., has represented at least 4,000 clients in a dozen mass joinder lawsuits against big banks, including Wells Fargo and Bank of America. Court documents indicate Brookstone’s earnings during 2011 and 2012 could be in the tens of millions of dollars. Yet the firm has yet to win a single one of these cases on the merits.

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Exec at center of first TARP bank failure gets 8 years in prison

The bank executive at the center of one of the largest bank failures in recent years will spend the next 8 years in prison for his part in a scheme that cost the American taxpayers more than $300 million.

Ebrahim Shabudin, the former chief operating officer and chief credit officer at United Commercial Bank, was sentenced to 97 months in federal prison for securities fraud and other corporate fraud offenses stemming from the failure of United Commercial.

United Commercial was the first bank to fail after receiving bailout funds through the government’s Trouble Asset Relief Program, and government officials are calling Shabudin’s prosecution the “most significant for crimes arising out of the bailout.”

According to a release from the Special Inspector General for the Troubled Asset Relief Program, Shabudin was the second most senior officer in executive management at UCB after former chief executive officer Thomas Shiu-Kit Wu.

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After Seeing Photo Of Greek Man Crying Outside Bank, CEO In Australia Vows To Help Him

Very sad, but I am glad that Australia CEO will help that man. But unfortunately, there are others in Greece that need help…

Days before Greece voted against a European bailout deal, a photograph of a 77-year-old Greek man crying outside a bank was widely circulated in the media. The moving image, which captures the impact of the current debt crisis on everyday citizens, caught the attention of a compassionate man who felt compelled to help.

Giorgos Chatzifotiadis, a Greek retiree, was photographed sobbing on the ground after being unable to withdraw a pension on behalf of his wife, Agence France-Presse reported. Gap Finance CEO James Koufos who lives in Sydney, Australia, saw the image, and with the help of his mother, identified the 77-year-old as an old friend of his father’s.

While he’s miles away from the crisis, Koufos called on people across social media this past Sunday to help track the man down so that he could help pay Chatzifotiadis’ pension.

“This man is a old school friend of my late father! Gap Finance and I will pay this man’s pension for 12 months plus!!! As long as it takes!!” Koufos wrote in a Facebook post. “I will never allow to see a fellow Greek proud hardworking man starve!! Please, please if anyone can help track this man down with his details I urge you to contact us.”

Koufos’ efforts seem to have paid off as he was able to track down Chatzifotiadis,News.com.au reported. The CEO now plans to fly to Greece this Saturday to meet with the 77-year-old.

Chatzifotiadis’ photo was taken after the man had waited in line at four different banks in hopes of collecting a pension. When he was told that he would be unable to withdraw the money, the retiree broke down, according to AFP. The 77-year-old’s emotional reaction struck a chord with Koufos.

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Wells Fargo’s ‘inconsistent’ bankruptcy program troubles bank in court

wells-fargo-hells-cargo

When Rodney Wayne Weidenbenner went to sleep on March 11, 2014, every penny he had left in the world was in four Wells Fargo accounts.

When he woke up, the money was gone — seized by Wells Fargo.

Like many New York small-business owners, Weidenbenner watched his income collapse after the Great Recession. Mounting bills forced the father of two and his wife to file for bankruptcy protection in early March 2014. In the filing, they arranged for roughly $6,900 to remain available for essentials: business expenses, prescription medication and diapers for their youngest child.

The nation’s fourth-largest bank had other ideas. Claiming that the bankruptcy code required it to preserve estate funds and follow the trustee’s directions regarding the money, Wells Fargo cut off access to almost all the money, court documents show.

That action stunned a struggling family trying to make a fresh start — and was ruled wrongful control of the Weidenbenners’ bank accounts by Bankruptcy Court Judge Cecelia G. Morris. Last December, Morris awarded the Weidenbenners $25 in damages for a bounced-check charge, plus costs and lawyers fees. But the legal is more valuable than the money, lawyer said.

In her ruling, the judge blasted Wells Fargo, which was not a creditor in the case, for freezing the money and controlling access to it. Accusing the bank of “grandstanding” about bankruptcy-code compliance, Judge Morris called out the inconsistencies in Wells’ national program, which only freezes balances worth more than $5,000.

Wells Fargo is appealing.

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