Tag Archives: New York Attorney General

NY AG reportedly investigating Nationstar Mortgage, OneWest Bank reverse mortgage divisions

New York Attorney General Eric Schneiderman is investigating practices related to the servicing of reverse mortgages at Financial Freedom, a part of OneWest Bank, and at Champion Mortgage, a unit of Nationstar Mortgage, as the state further heightens its recent focus on reverse mortgages, an article in The Wall Street Journal by Annamaria Andriotis stated.

“The inquiry, which is in early stages, is examining whether businesses employed tactics that pushed elderly borrowers into foreclosure,” the article sated.

Read on.

Citi Pays Overcharged Customers $23M After NY AG Probe

Law360, New York (January 12, 2017, 3:36 PM EST) — New York Attorney General Eric Schneiderman on Thursday closed the book on a four-year investigation into a Citigroup subsidiary that revealed over 47,000 customers were overcharged by more than $22.5 million in fees on their managed investment accounts.

The agreement additionally requires the company to hand the New York attorney general’s office detailed quarterly reports on any fee overcharging issues that arise over the next three years. (AP) Citigroup Global Markets Inc. admitted in the deal that it had overcharged customers who negotiated discounted fee rates…

Source: Law360

Trump hotels agree to pay $50K in data breach settlement with NY AG

The Attorney General reached a settlement with Trump Hotel Collection involving a data breach that resulted in the exposure of over 70,000 credit card numbers and other personal data. Infiltrators hacked into the company’s payment processing system and deployed malware designed to steal credit card information. The hotels have agreed to pay $50,000 in penalties and reform its data security practices. Read The Hill piece here.

NY AG, Trump hurl barbs in Trump U. case

Trump suggests ‘dopey’ NY AG Schneiderman’s lawsuit is politically motivated while NY AG Schneiderman says Trump was ‘shameless’ in willingness to lie. Click here to read more.

What is interesting is that Schneiderman’s lawsuit can continue. Trump’s lawyers argued that the lawsuit fell outside the statue of limitations to claim fraud. From Times Union website:

An appellate court ruled in March that Schneiderman’s lawsuit can continue, shooting down arguments from Trump’s attorneys that the suit falls outside of the three-year statute of limitations for claiming fraud.

From the New York Attorney General website, Schneiderman stated in March that his case is subject to a six-year statute:

“Today’s decision is a clear victory in our effort to hold Donald Trump and Trump University accountable for defrauding thousands of students.  The state Supreme Court had already granted our request for summary judgment determining that Trump and his University are liable for operating illegally in New York as an unlicensed educational institution. Today’s decision means our entire fraud case can move forward, and confirms that the case is subject to a six year statute of limitations. As the state’s chief law enforcement officer, my job is to see that perpetrators of fraud are brought to justice. We look forward to demonstrating in a court of law that Donald Trump and his sham for-profit college defrauded more than 5,000 consumers out of millions of dollars.” 

Wall Street Firms Under Investigation for Treatment of Retail Investors

Authorities sent subpoenas to several firms in connection with probe into the handling of retail clients’ orders

Federal and state authorities are investigating whether Wall Street firms that handle millions of orders annually for retail clients have lived up to their obligation to provide the best possible treatment for those investors, according to people familiar with the matter.

The Justice Department’s civil division has sent subpoenas to several firms including Citadel Securities, the market-making business of Citadel LLC, and KCG Holdings Inc. in connection with the probe, these people said.

The New York attorney general’s office is also conducting a broad investigation into practices that may create an unfair disadvantage for retail investors whose stock orders are handled by electronic market makers, and has sent a subpoena to Citadel and other firms, one of the people said.

The federal subpoenas are issued under a civil fraud law, the Financial Institutions Reform, Recovery and Enforcement Act, or Firrea, which covers fraud affecting federally insured financial institutions, the people said.

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New York Attorney General pushes FHFA for principal reduction

It turns out that the housing rights protestors that interrupted a lecture earlier this week at Harvard from Federal Housing Finance Agency Director Mel Watt aren’t the only ones pushing the FHFA to engage in principal reduction.

In a letter sent this week to Watt, New York Attorney General Eric Schneiderman joins the chorus calling for Fannie Mae and Freddie Mac to reduce the mortgage balances of struggling borrowers.

In Schneiderman’s letter, a copy of which was obtained by HousingWire, New York’s attorney general says that he is “pleased” that the FHFA is now “seriously evaluating” adopting a principal reduction plan, and advocates that principal reduction “should be deployed broadly and quickly to homeowners in desperate need of this relief from the continuing damage caused by the housing crisis.”

According to Watt, the FHFA is still considering a principal reduction plan, despite reports to the contrary.

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New York AG Opens Probe Into Currency Manipulation

The New York Attorney General has opened an investigation into possible manipulation of options contracts tied to currencies of developing nations, according to a person familiar with the matter.

The regulator filed subpoenas last week to four brokers that operate platforms for trading the contracts: Tullett Prebon PLC, BGC Partners Inc., GFI Group Inc. and TFS-ICAP Ltd., the person said. The investigation was started after the attorney general’s office received a tip and is still at a preliminary stage, the person said.

The inquiries center on the alleged use of bids or offers by firms to bluff others into believing particular contracts had more buying and selling interest than they truly had, a practice also known as “ghosting” or “flying,” the person said. By increasing volume, brokers that operate trading platforms could gain more fees, the person said.

The office’s Criminal Enforcement and Financial Crimes Bureau is leading the investigation. Representatives for the brokers who were sent subpoenas declined to comment.

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New York attorney general calls on banks to step up efforts to provide the poor access

New York’s attorney general called on more than 90 banks, including units of Toronto-Dominion Bank and HSBC Holdings Plc, to revamp customer screening procedures in order to give poor people better access to financial services.

Following agreements with several major banks to change how they use screening tools, Attorney General Eric Schneiderman sent letters Monday urging other financial institutions to adopt new standards.

The measure is aimed at helping more than 2 million households in the state that lack access to mainstream bank accounts including “unbanked” or “underbanked” populations, which are disproportionately represented by African-American and Hispanic consumers.

“It is critical that low-income Americans—and New Yorkers in particular—have access to mainstream banking services,” Schneiderman said in a statement. In his letters, Schneiderman said he asked banks to “look closely at the benefits that would accrue to the people of the state, as well as to their institutions, if they were to adopt similar changes to their account screening procedures.”

Credit reporting services used to examine prospective customers’ account histories, such as ChexSystems Inc. and Early Warning Services LLC, caused banks to reject thousands of applicants for minor problems such as isolated bounced checks, according to Schneiderman.

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Credit Suisse in talks to settle ‘dark pool’ allegations: WSJ

(Reuters) – Credit Suisse Group AG (>> Credit Suisse Group AG) is in talks to settle allegations related to its Crossfinder “dark pool” trading venue, which could result in a fine running in the high tens of millions of dollars, the Wall Street Journal reported, citing people familiar with the matter.

Dark pools are broker-run trading venues that let investors trade shares anonymously and only make trading data available afterwards, reducing the chance of information leaking about trade orders.

The case against Credit Suisse include allegations that it facilitated unfair advantages for some traders, didn’t follow rules against pricing of stocks and was not able to properly disclose how Crossfinder works to investors, the WSJ said.

The bank is in negotiations with the New York Attorney General and the Securities and Exchange Commission and a deal could come as early as the next several weeks, the paper said.

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NY AG Schneiderman eyes ‘dark pool’ settlement with Credit Suisse

New York Attorney General Eric Schneiderman is prepping a September civil settlement with Credit Suisse over its dark pool trading platform, The Post has learned.

This would be Schneiderman’s second action against banks’ private trading platforms since a Barclays suit in 2014.

Schneiderman’s office has been locked in a battle with Wall Street’s biggest banks since last June over their lightly regulated dark pools, which act like exchanges but allow investors to trade anonymously. The probe has looked at least four banks, including Barclays, Deutsche Bank and UBS.

hRead on.