Be back with new postings on January 3, 2011! Have a wonderful New Year!
Friday, December 31, 2010
15 Ridiculously Hard Job Interview Questions From Top Employers Like Google, Goldman Sachs
http://www.huffingtonpost.com/2010/12/30/job-interview-questions_n_802658.html#s217070&title=Volkswagen%20-%20Business%20Analyst%20position.
Love this hard job interview question from company Guardsmark for Staff Writer position: “What do wood and alcohol have in common?”
My answer: Both are stiffs.
Could you imagine if we can ask these hard job interviews to politicians running for office?
How many M&M's can fit into a jar?
Palin: Not enough. I refudiate the question.
Lawmakers: A tax on peanuts!
Fox News: Blue M&Ms are liberals.
Wingnuts: There must be a conspurucy here.
Joe Miller: I want a recount!
Love this hard job interview question from company Guardsmark for Staff Writer position: “What do wood and alcohol have in common?”
My answer: Both are stiffs.
Could you imagine if we can ask these hard job interviews to politicians running for office?
How many M&M's can fit into a jar?
Palin: Not enough. I refudiate the question.
Lawmakers: A tax on peanuts!
Fox News: Blue M&Ms are liberals.
Wingnuts: There must be a conspurucy here.
Joe Miller: I want a recount!
Biloxi Buzz for Friday
Citigroup India Says Employee Forged Documents to Lure Investors
Ex-'Car Czar' To Pay $10 Million Settlement
Bank bailout architect Hank Paulson sells home for 1/3 less than purchase price.'King Of The Birthers' Announces Presidential Run
Georgia Legislator's Bill Would Require Taxes Be Paid In Gold And Silver
Bobby Franklin, a Republican state legislator from Georgia, has introduced a new piece of legislation that, if passed, would force Georgians to pay their taxes in gold and silver coins.
Here's what his Constitutional Tender Act sets forth:
Pre-1965 silver coins, silver eagles, and gold eagles shall be the exclusive medium which the state shall use to make any payments whatsoever to any person or entity, whether private or governmental. Such coins shall be the exclusive medium which the state shall accept from any person or entity as payment of any obligation to the state including, without limitation, the payment of taxes; provided, however, that such coins and other forms of currency may be used in all other transactions within the state upon mutual consent of the parties of any such transaction.
ThinkProgress argues such an abrupt return to the gold or silver standard could stagnate the tax-payment process:
Were Franklin's bill ever to become law it would have immediate and catastrophic consequences for Georgia's economy. Among other things, the U.S. Mint simply does not make very many gold and silver coins -- the Mint has even suspended sales of precious medal coins when demand rises above very low levels -- so it is unlikely that enough coins even exist to allow Georgia taxpayers to pay more than a fraction of their tax obligations if they are required to do so in U.S. minted gold or silver.
Read on.
Here's what his Constitutional Tender Act sets forth:
Pre-1965 silver coins, silver eagles, and gold eagles shall be the exclusive medium which the state shall use to make any payments whatsoever to any person or entity, whether private or governmental. Such coins shall be the exclusive medium which the state shall accept from any person or entity as payment of any obligation to the state including, without limitation, the payment of taxes; provided, however, that such coins and other forms of currency may be used in all other transactions within the state upon mutual consent of the parties of any such transaction.
ThinkProgress argues such an abrupt return to the gold or silver standard could stagnate the tax-payment process:
Were Franklin's bill ever to become law it would have immediate and catastrophic consequences for Georgia's economy. Among other things, the U.S. Mint simply does not make very many gold and silver coins -- the Mint has even suspended sales of precious medal coins when demand rises above very low levels -- so it is unlikely that enough coins even exist to allow Georgia taxpayers to pay more than a fraction of their tax obligations if they are required to do so in U.S. minted gold or silver.
Read on.
Thursday, December 30, 2010
Banks found guilty of foreclosure fraud
Stock Market Review website:
As a result of the recent investigation launched by the Florida Attorney General’s office, Bank Of America, GMAC Bank, JP Morgan Chase, and others, have all been found guilty of foreclosure fraud.
Depositions by the banks employees revealed that the banks have been forging, falsifying, and fabricating documents in order to foreclose on millions of homes owned by unsuspecting American homeowners.
Additionally, Wells Fargo Bank has admitted to 55,000 counts of perjury in submitting false affidavits to the courts in its efforts to fraudulently foreclose on homeowners.
To add to this disgusting, and arrogant display of lawlessness by the banks, nothing has been done by the Justice Department, or any other federal officials in the way of civil or criminal charges against the banks, until now.
Recently, The Arizona and Nevada Attorney Generals have filed a civil lawsuit against Bank Of America for fraud against homeowners seeking loan modification, and hopefully there will be more lawsuits on the way, as the Obama Administration has also launched a Financial Fraud Enforcement Task Force to investigate and prosecute financial crimes in the lending and financial markets. As bank fraud has already proved to be pervasive, lets hope that this task force has the political will and integrity to prosecute the banks, and the corrupt attorneys who represent them.
These are essentially mortgages that the banks knew they did not own, but were willing to break the law in order to put homeowners out on the streets to satisfy their insatiable greed for even more money.
In spite of clear and convincing documented evidence, in the forms of deposition testimony by bank employees, the banks have been carrying on as if nothing ever happened, and federal officials have seemingly given them the green light to continue to break the law with impunity.
Until such time as the Department Of Justice, the SEC, and the Attorney Generals of each state decide to take action against these criminal banks, homeowners have no choice but to implement their own available legal strategies to fight to save their homes. Because most of these foreclosure cases involve the banks inability to produce the promissory note in order to prove they have any legal rights to foreclosure; homeowners have several legal strategies available to them in order to stop the banks from fraudulently foreclosing on their homes.
One of the more popular strategies employed of late is the “Produce The Note” Strategy. As a large percentage of mortgage loans were securitized, and sold to investors all over the world, it has been difficult, if not impossible, for the banks to produce the required documents that would establish their right to foreclosure, as those documents have been lost in the Wall Street ether. This is why the banks have attempted to forge and falsify the documents, but have been recently caught, and found guilty of fraud.
Secondly, the homeowner can also file a civil suit against the banks for fraud, and make them prove they are the rightful owner of the note who is authorized to foreclose on the homeowner’s property.
Last, but definitely not least, is the latest, and possibly most powerful strategy available, which does not require a homeowner to go to court at all. It is strictly an administrative process pursuant to The Administrative Procedures Act Of 1946, by which the homeowner is legally able to reconvey the property title back into his/her name, thereby revoking any authority by the bank to foreclose on the property, and taking the property back free & clear usually within 90 days.
This effectively puts the homeowner back in control, and forces the bank to deal with the homeowner, who now is negotiating from a position of strength, instead of begging the bank for help. The bank now has to go to the homeowner to resolve any title issues.
Until such time as our government officials decide that they will uphold, and enforce the rule of law, and the U.S Constitution, and not allow themselves to be bought by the banks lobbyist, the American homeowner must be willing to fight for their constitutional rights, and homes by any legal means necessary against the Federal Reserve, the banks, and the wealthy Wall Street barons, who created this mess with the full intention of fleecing the American citizens from all of their remaining wealth in the form of equity in their homes
As a result of the recent investigation launched by the Florida Attorney General’s office, Bank Of America, GMAC Bank, JP Morgan Chase, and others, have all been found guilty of foreclosure fraud.
Depositions by the banks employees revealed that the banks have been forging, falsifying, and fabricating documents in order to foreclose on millions of homes owned by unsuspecting American homeowners.
Additionally, Wells Fargo Bank has admitted to 55,000 counts of perjury in submitting false affidavits to the courts in its efforts to fraudulently foreclose on homeowners.
To add to this disgusting, and arrogant display of lawlessness by the banks, nothing has been done by the Justice Department, or any other federal officials in the way of civil or criminal charges against the banks, until now.
Recently, The Arizona and Nevada Attorney Generals have filed a civil lawsuit against Bank Of America for fraud against homeowners seeking loan modification, and hopefully there will be more lawsuits on the way, as the Obama Administration has also launched a Financial Fraud Enforcement Task Force to investigate and prosecute financial crimes in the lending and financial markets. As bank fraud has already proved to be pervasive, lets hope that this task force has the political will and integrity to prosecute the banks, and the corrupt attorneys who represent them.
These are essentially mortgages that the banks knew they did not own, but were willing to break the law in order to put homeowners out on the streets to satisfy their insatiable greed for even more money.
In spite of clear and convincing documented evidence, in the forms of deposition testimony by bank employees, the banks have been carrying on as if nothing ever happened, and federal officials have seemingly given them the green light to continue to break the law with impunity.
Until such time as the Department Of Justice, the SEC, and the Attorney Generals of each state decide to take action against these criminal banks, homeowners have no choice but to implement their own available legal strategies to fight to save their homes. Because most of these foreclosure cases involve the banks inability to produce the promissory note in order to prove they have any legal rights to foreclosure; homeowners have several legal strategies available to them in order to stop the banks from fraudulently foreclosing on their homes.
One of the more popular strategies employed of late is the “Produce The Note” Strategy. As a large percentage of mortgage loans were securitized, and sold to investors all over the world, it has been difficult, if not impossible, for the banks to produce the required documents that would establish their right to foreclosure, as those documents have been lost in the Wall Street ether. This is why the banks have attempted to forge and falsify the documents, but have been recently caught, and found guilty of fraud.
Secondly, the homeowner can also file a civil suit against the banks for fraud, and make them prove they are the rightful owner of the note who is authorized to foreclose on the homeowner’s property.
Last, but definitely not least, is the latest, and possibly most powerful strategy available, which does not require a homeowner to go to court at all. It is strictly an administrative process pursuant to The Administrative Procedures Act Of 1946, by which the homeowner is legally able to reconvey the property title back into his/her name, thereby revoking any authority by the bank to foreclose on the property, and taking the property back free & clear usually within 90 days.
This effectively puts the homeowner back in control, and forces the bank to deal with the homeowner, who now is negotiating from a position of strength, instead of begging the bank for help. The bank now has to go to the homeowner to resolve any title issues.
Until such time as our government officials decide that they will uphold, and enforce the rule of law, and the U.S Constitution, and not allow themselves to be bought by the banks lobbyist, the American homeowner must be willing to fight for their constitutional rights, and homes by any legal means necessary against the Federal Reserve, the banks, and the wealthy Wall Street barons, who created this mess with the full intention of fleecing the American citizens from all of their remaining wealth in the form of equity in their homes
Wikileaks leader: BofA info to be released will be on par with Enron scandal
Written by Biloxi
I began to question what information that Wikileaks leader Julian Assange will dump early next year on Bank of America executives that will be damaging to the company that will cause resignations. Mr. Assange says that Bank of America information dump will be similar to how Enron company was exposed as criminal.
Mr. Assange said in Forbes, "When Enron collapsed, through court processes, thousands and thousands of emails came out that were internal, and it provided a window into how the whole company was managed." I began to wonder what Mr. Assange meant by that. Well, we do know that the downfall of the Enron scandal was not internal emails. In 2003, Enron emails were released that contains thousands and upon thousands messages from Enron staff after the Enron collapse in 2001. These emails included how the family of the then-CEO Ken Lay lived large in the glory days of Enron company, how company executives almost obsessively followed the investigation into price gouging during California's energy crisis, how ultimately Enron employees suffered when the company collapsed and so on. If Assange has damaging information on Bank of America executives which I believe he does, could it be catching the bank executives saying one thing internally while telling the shareholders something else? Now that could be damning. I started to dig into these three possible, if not all, scandals that entangle Bank of America.
First, there is the ties of the Enron scandal with Bank of America. As you recall the Enron scandal, it was the complex and questionable accounting practices that lead to Enron's demise. Then CFO
.
I began to question what information that Wikileaks leader Julian Assange will dump early next year on Bank of America executives that will be damaging to the company that will cause resignations. Mr. Assange says that Bank of America information dump will be similar to how Enron company was exposed as criminal.
Mr. Assange said in Forbes, "When Enron collapsed, through court processes, thousands and thousands of emails came out that were internal, and it provided a window into how the whole company was managed." I began to wonder what Mr. Assange meant by that. Well, we do know that the downfall of the Enron scandal was not internal emails. In 2003, Enron emails were released that contains thousands and upon thousands messages from Enron staff after the Enron collapse in 2001. These emails included how the family of the then-CEO Ken Lay lived large in the glory days of Enron company, how company executives almost obsessively followed the investigation into price gouging during California's energy crisis, how ultimately Enron employees suffered when the company collapsed and so on. If Assange has damaging information on Bank of America executives which I believe he does, could it be catching the bank executives saying one thing internally while telling the shareholders something else? Now that could be damning. I started to dig into these three possible, if not all, scandals that entangle Bank of America.
First, there is the ties of the Enron scandal with Bank of America. As you recall the Enron scandal, it was the complex and questionable accounting practices that lead to Enron's demise. Then CFO
Andrew Fastow constructed off-book entities in an effort to hide debt and inflate profits for the company. I found an article that was written in 2003 in which "Enron examiner Harrison Goldin came down hard on two of the Big Four accounting firms and two major investment banks in a new report addressing transactions involving the controversial special-purpose entities at Enron Corp." Bank of America was one of the major investment banks. Mr. Goudin said,"Bank of America and Royal Bank of Canada knew of fraud in Enron-related transactions, according to Reuters." The real question did any of the Bank of America executives benefitted from the Enron fraud. That remains to be seen.
Second, Bank of America's $4 billion takeover of Countrywide Financial. Bank of America executives believed Countrywide's mortgage business might be worth the purchase. Then Bank of America CEO Ken
Lewis said "The ability to get that kind of size and scale became more appealing as we saw the business model change to a model we could accept,.We considered the lawsuits, the negative publicity that Countrywide had. We weighed the short-term pain versus what we think will be a very good deal for our shareholders." The big question was there a scheme by which Bank of America intends to acquire Countrywide but leave the Countrywide debt behind?
From “Are Countrywide Financial Bonds Bankruptcy Remote? from Institutional Risk Analytics in 2008:
The announced acquisition of Countrywide Financial (NYSE:CFC) by Bank of America (NYSE:BAC) was in doubt on Friday because of reports that BAC may back away from the deal. Pity CFC shareholders, who are selling at something like 5% of book value (and this for BAC paper), but we wonder how many of the CFC bond holders understand that they may face an equal or greater haircut.
The CFC 6.25%s of 2016 closed at 79.125 on Friday or over a 10% YTM. The pricing reflects the expectation that BAC will assume responsibility for the CFC debt at par. But after hearing from some bankers in the know and reading the “Agreement and Plan of Merger” filed with the SEC by BAC last week, we think that CFC bond holders will soon get the joke.
Usually, when a company acquires another, the former assumes the debt of the latter and agrees to make timely payments of interest and principal as previously contracted. In the case of BAC’s purchase of CFC, however, BAC seems to view the transaction as an option.
Bankers who’ve been briefed by BAC officials tell The IRA that CEO Ken Lewis intends to keep the crippled thrift holding company “bankruptcy remote” by merging CFC with a new vehicle, called Red Oak Merger Corp in the merger plan, and that BAC does not intend to consolidate the entity or take full responsibility for the CFC debt.
According to the plan: “…at the Effective Time, [CFC] shall merge with and into Merger Sub. Merger Sub shall be the Surviving Company in the Merger and shall continue its existence as a limited liability company under the laws of the State of Delaware.” (BAC public affairs officials Kevin Stitt and Pamela Black did not respond to written questions sent by The IRA via email on Thursday.)
The implication is that BAC eventually will take direct ownership of the FDIC insured Countrywide Bank FSB, which now has assets of some $130 billion, leaving the remaining assets of the formerly public CFC and a good chunk of its $105 billion in parent level debt at risk of an eventual default. BAC officials are reported to have said that BAC’s deposit base and debt issuing power offer significant funding advantages to CFC, but also said that BAC will keep the target separate for an “interim period” of indeterminate duration.
FDIC insured banks, you see, cannot file bankruptcy. Were BAC to even contemplate putting the company formerly known as CFC into Chapter 11, it would first need to move Countrywide Bank FSB to a different part of the BAC group. Otherwise, when BAC was about to file the Chapter 11 petition, the Office of Thrift Supervision would intervene and invoke its statutory authority as the bank’s primary regulator to appoint the FDIC as receiver of the bank, potentially stripping BAC of its entire equity investment.
Did Bank of America stiff the bondholders in the merger with Countrywide? And is the Bank of America/Countrywide merger is part of the Wikleaks' soon-to-be released info on the BofA's bank executives? It may be possible.
Third, Bank of America's merger with Merrill Lynch. Like Countrywide, then Bank of America CEO Ken Lewis said that Merrill Lynch merger was a good deal for the shareholder. New York Attorney General Andrew Cuomo didn't think so. Bank of America approved bonuses before the merger and didn't disclose them to its shareholders when the shareholders were considering approving the Merrill acquisition in December 2008. In addition, Bank of America understated the Merrill Lynch losses to shareholders and then overstated their ability to terminate their agreement to secure $20 billion of TARP money. These factors by Bank of America was what prompted New York Attorney General Cuomo to investigate Bank of America of defrauding the government and the taxpayers.
Second, Bank of America's $4 billion takeover of Countrywide Financial. Bank of America executives believed Countrywide's mortgage business might be worth the purchase. Then Bank of America CEO Ken
Lewis said "The ability to get that kind of size and scale became more appealing as we saw the business model change to a model we could accept,.We considered the lawsuits, the negative publicity that Countrywide had. We weighed the short-term pain versus what we think will be a very good deal for our shareholders." The big question was there a scheme by which Bank of America intends to acquire Countrywide but leave the Countrywide debt behind?
From “Are Countrywide Financial Bonds Bankruptcy Remote? from Institutional Risk Analytics in 2008:
The announced acquisition of Countrywide Financial (NYSE:CFC) by Bank of America (NYSE:BAC) was in doubt on Friday because of reports that BAC may back away from the deal. Pity CFC shareholders, who are selling at something like 5% of book value (and this for BAC paper), but we wonder how many of the CFC bond holders understand that they may face an equal or greater haircut.
The CFC 6.25%s of 2016 closed at 79.125 on Friday or over a 10% YTM. The pricing reflects the expectation that BAC will assume responsibility for the CFC debt at par. But after hearing from some bankers in the know and reading the “Agreement and Plan of Merger” filed with the SEC by BAC last week, we think that CFC bond holders will soon get the joke.
Usually, when a company acquires another, the former assumes the debt of the latter and agrees to make timely payments of interest and principal as previously contracted. In the case of BAC’s purchase of CFC, however, BAC seems to view the transaction as an option.
Bankers who’ve been briefed by BAC officials tell The IRA that CEO Ken Lewis intends to keep the crippled thrift holding company “bankruptcy remote” by merging CFC with a new vehicle, called Red Oak Merger Corp in the merger plan, and that BAC does not intend to consolidate the entity or take full responsibility for the CFC debt.
According to the plan: “…at the Effective Time, [CFC] shall merge with and into Merger Sub. Merger Sub shall be the Surviving Company in the Merger and shall continue its existence as a limited liability company under the laws of the State of Delaware.” (BAC public affairs officials Kevin Stitt and Pamela Black did not respond to written questions sent by The IRA via email on Thursday.)
The implication is that BAC eventually will take direct ownership of the FDIC insured Countrywide Bank FSB, which now has assets of some $130 billion, leaving the remaining assets of the formerly public CFC and a good chunk of its $105 billion in parent level debt at risk of an eventual default. BAC officials are reported to have said that BAC’s deposit base and debt issuing power offer significant funding advantages to CFC, but also said that BAC will keep the target separate for an “interim period” of indeterminate duration.
FDIC insured banks, you see, cannot file bankruptcy. Were BAC to even contemplate putting the company formerly known as CFC into Chapter 11, it would first need to move Countrywide Bank FSB to a different part of the BAC group. Otherwise, when BAC was about to file the Chapter 11 petition, the Office of Thrift Supervision would intervene and invoke its statutory authority as the bank’s primary regulator to appoint the FDIC as receiver of the bank, potentially stripping BAC of its entire equity investment.
Did Bank of America stiff the bondholders in the merger with Countrywide? And is the Bank of America/Countrywide merger is part of the Wikleaks' soon-to-be released info on the BofA's bank executives? It may be possible.
Third, Bank of America's merger with Merrill Lynch. Like Countrywide, then Bank of America CEO Ken Lewis said that Merrill Lynch merger was a good deal for the shareholder. New York Attorney General Andrew Cuomo didn't think so. Bank of America approved bonuses before the merger and didn't disclose them to its shareholders when the shareholders were considering approving the Merrill acquisition in December 2008. In addition, Bank of America understated the Merrill Lynch losses to shareholders and then overstated their ability to terminate their agreement to secure $20 billion of TARP money. These factors by Bank of America was what prompted New York Attorney General Cuomo to investigate Bank of America of defrauding the government and the taxpayers.
In 2009, leaked testimony by Ken Lewis revealed that according to Business Insider, Federal Reserve head
We can only wait and see if it indeed Bank of America is Assange's target. But, there is so much being build into the possibility that it is Bank of America. Assange did say that he could take down "one bank or no." For sure, if Assange can take down one bank, he certainly leaving the door opens to take down more than one bank. The question is what is the other bank?
Bernanke and then Treasury Secretary Hank Paulson implicitly ordered Lewis to keep silent about the massive losses Merrill Lynch was sustaining in fourth quarter of earnings. Also, Paulson told Ken Lewis he would oust him and the Bank of America Corp.board if Lewis stopped the Merrill deal.
We can only wait and see if it indeed Bank of America is Assange's target. But, there is so much being build into the possibility that it is Bank of America. Assange did say that he could take down "one bank or no." For sure, if Assange can take down one bank, he certainly leaving the door opens to take down more than one bank. The question is what is the other bank?
.
Wednesday, December 29, 2010
Allstate sues Bank of America, others over $700 million in toxic loans
Written by Biloxi
Allstate Corp. has sued Bank of America Corp. and eighteen other defendants including several former Countrywide officials and ex-CEO Angelo Mozillo. In a complaint filed Monday in Manhattan federal court, Allstate, alleged that Countrywide misled it into believing the mortgage-backed securities it bought were safe. According to the complaint, "Defendants knew the loans offloaded onto Allstate were a toxic mix of loans given to borrowers that could not afford the properties, and thus were highly likely to default."Allstate stated that it suffered on more than $700 million of mortgage debt that it bought from Countrywide Financial Corp. now owned by Bank of America. Allstate “seeks unspecified damages, alleges fraud, negligent misrepresentation and violation of U.S. securities laws."Now, how does Allstate know that Countrywide Corp. misled the company? Allstate used sampling to confirm that Countrywide lied to Allstate when the selling mortgages.
Via ZeroHedge:
According to the complaint, Allstate determined that Countrywide now owned by Bank of America misrepresented virtually everything in its prospectuses: from the percentage of owner-occupied properties reped in prospectuses (about a 10% differential) to the loan-to-value (LTV) thresholds on represented loans (both at the 90% and 100% threshold) while in between finding willful intent to defraud and deceive Allstate.
This latest bombshell lawsuit against Bank of America gives certainly the green light for anyone who believes that the banks or its predecessor was dishonest in representing any and all deal components, and wishes to do so by using statistical sampling to prove his or her case. This is certainly bad news for banks that inherited its predecessor or predecessor's toxic mortgages. Read entire Allstate complaint.
Allstate Insurance Co Et Al v. Countrywide Financial Corp
Allstate Corp. has sued Bank of America Corp. and eighteen other defendants including several former Countrywide officials and ex-CEO Angelo Mozillo. In a complaint filed Monday in Manhattan federal court, Allstate, alleged that Countrywide misled it into believing the mortgage-backed securities it bought were safe. According to the complaint, "Defendants knew the loans offloaded onto Allstate were a toxic mix of loans given to borrowers that could not afford the properties, and thus were highly likely to default."Allstate stated that it suffered on more than $700 million of mortgage debt that it bought from Countrywide Financial Corp. now owned by Bank of America. Allstate “seeks unspecified damages, alleges fraud, negligent misrepresentation and violation of U.S. securities laws."Now, how does Allstate know that Countrywide Corp. misled the company? Allstate used sampling to confirm that Countrywide lied to Allstate when the selling mortgages.
Via ZeroHedge:
According to the complaint, Allstate determined that Countrywide now owned by Bank of America misrepresented virtually everything in its prospectuses: from the percentage of owner-occupied properties reped in prospectuses (about a 10% differential) to the loan-to-value (LTV) thresholds on represented loans (both at the 90% and 100% threshold) while in between finding willful intent to defraud and deceive Allstate.
This latest bombshell lawsuit against Bank of America gives certainly the green light for anyone who believes that the banks or its predecessor was dishonest in representing any and all deal components, and wishes to do so by using statistical sampling to prove his or her case. This is certainly bad news for banks that inherited its predecessor or predecessor's toxic mortgages. Read entire Allstate complaint.
New California AG could sue banks on foreclosures
(Reuters) - Kamala Harris takes over as California's attorney general next week with dodgy bank foreclosure practices in her sights and lawsuits against major banks in her realm of possibilities.
For the up-and-coming Democratic star -- the state's first woman, South Indian and African American attorney general -- her predecessor and California Governor-elect Jerry Brown is a model to follow in cracking down on lenders.
But while Brown scored an early settlement against banks as home foreclosures mushroomed in California, other states have been more aggressive of late. Borrower activists are hoping Harris will make the most populous U.S. state a more powerful ally against the banks.
Mortgage servicers have come under fire in recent months for abuses of the foreclosure process, prompting the nation's 50 state attorneys general to coordinate an investigation of lenders such as Bank of America (BAC.N), JPMorgan Chase & Co (JPM.N) and Ally Financial's GMAC unit.
This month, Arizona and Nevada, two neighboring states hit very hard by foreclosures, took a more aggressive stance and filed lawsuits against Bank of America.
Harris told Reuters in an interview on Tuesday that litigation is one potential course, along with discussions with lenders.
Click here for full story
http://www.reuters.com/article/idUSTRE6BR3UD20101228
For the up-and-coming Democratic star -- the state's first woman, South Indian and African American attorney general -- her predecessor and California Governor-elect Jerry Brown is a model to follow in cracking down on lenders.
But while Brown scored an early settlement against banks as home foreclosures mushroomed in California, other states have been more aggressive of late. Borrower activists are hoping Harris will make the most populous U.S. state a more powerful ally against the banks.
Mortgage servicers have come under fire in recent months for abuses of the foreclosure process, prompting the nation's 50 state attorneys general to coordinate an investigation of lenders such as Bank of America (BAC.N), JPMorgan Chase & Co (JPM.N) and Ally Financial's GMAC unit.
This month, Arizona and Nevada, two neighboring states hit very hard by foreclosures, took a more aggressive stance and filed lawsuits against Bank of America.
Harris told Reuters in an interview on Tuesday that litigation is one potential course, along with discussions with lenders.
Click here for full story
http://www.reuters.com/article/idUSTRE6BR3UD20101228
Obama administration steps up monitoring of banks that miss TARP payments
Source: The Washington Post
The Obama administration has begun monitoring the high-level board meetings of nearly 20 banks that received emergency taxpayer assistance but repeatedly failed to pay the required dividends, according to Treasury Department officials and documents. And it may soon install new directors on some of their boards.
The moves come as the number of banks that failed to make at least one dividend payment to the government rose to 132 in the last quarter. These "deadbeats," as they are sometimes called, are virtually all community lenders and collectively received billions of dollars in taxpayer assistance.
In addition to those firms, seven others have failed, resulting in the total loss of the government's investment.
Read the full story >>
The Obama administration has begun monitoring the high-level board meetings of nearly 20 banks that received emergency taxpayer assistance but repeatedly failed to pay the required dividends, according to Treasury Department officials and documents. And it may soon install new directors on some of their boards.
The moves come as the number of banks that failed to make at least one dividend payment to the government rose to 132 in the last quarter. These "deadbeats," as they are sometimes called, are virtually all community lenders and collectively received billions of dollars in taxpayer assistance.
In addition to those firms, seven others have failed, resulting in the total loss of the government's investment.
Read the full story >>
TWO AG’s SEND LETTER TO FEDERAL RESERVE QUESTIONING TILA PROVISION THAT WILL HARM CONSUMERS
EXCERPT:
TILA is designed to protect consumers who are not on an equal footing with lenders,
either in bargaining for credit terms or in knowledge of credit provisions. The proposed
amendments to Reg. Z, conditioning the voiding of the creditor’s security interest upon
the consumer’s tender, would be a large step backward from this purpose. In a time of
unprecedented numbers of foreclosures, it is unthinkable that the Federal Reserve would
weaken a critical provision of TILA and thus harm consumers.
Continue reading below…
TILA Statement AGs Cordray - Madigan - Reg Z Comments _R-1390
TILA is designed to protect consumers who are not on an equal footing with lenders,
either in bargaining for credit terms or in knowledge of credit provisions. The proposed
amendments to Reg. Z, conditioning the voiding of the creditor’s security interest upon
the consumer’s tender, would be a large step backward from this purpose. In a time of
unprecedented numbers of foreclosures, it is unthinkable that the Federal Reserve would
weaken a critical provision of TILA and thus harm consumers.
Continue reading below…
TILA Statement AGs Cordray - Madigan - Reg Z Comments _R-1390
Biloxi Buzz for Wednesday
IRAQ WANTS THE U.S. OUT
Ex-Shell president sees $5 gas in 2012
Ex-Shell president sees $5 gas in 2012
Alaska Election Results: Judge Rejects Joe Miller Lawsuit
Quest for Palin e-mails may exceed her time in office — You can do the math. — Alaska state regulations require public officials to make public records available to the public within 10 days in most cases. — On Monday evening, Sarah Palin's former staff in the Alaska governor's
NJ Governor Slammed For Going To Disney World During Blizzard
Wall Street Execs Whine About How Obama Hurt Their Feelings
AG investigating billings by foreclosure process-servers
TAMPA - Florida Attorney General Bill McCollum has launched civil investigations into two of Florida's major foreclosure process-serving companies.
The attorney general's office is looking into questionable affidavits, concerns about service of complaints, and allegations of overbilling and back-dating documents.
The companies under investigation are Tampa-based ProVest Inc. and Gissen & Zawyer Process of Service Inc. in Miami.
Both companies were routinely used by the law offices of David J. Stern to notify homeowners when a foreclosure lawsuit is filed against them.
The Stern office is also under investigation by the attorney general. Mortgage giants Fannie Mae and Freddie Mac pulled all foreclosure work from the firm.
Two former employees of Stern's office recently said in sworn statements to the attorney general's office that the law firm inflates bills by creating summonses for unknown spouses, unknown tenants and others.
These summonses are then passed along to process serving companies, such as G&Z and ProVest, to be delivered to homeowners, according to their statements.
Foreclosure defense attorneys, legal scholars, consumer advocates and some judges have criticized the practice as a means of racking up fees, which are ultimately passed along to the consumer.
Read on.
The attorney general's office is looking into questionable affidavits, concerns about service of complaints, and allegations of overbilling and back-dating documents.
The companies under investigation are Tampa-based ProVest Inc. and Gissen & Zawyer Process of Service Inc. in Miami.
Both companies were routinely used by the law offices of David J. Stern to notify homeowners when a foreclosure lawsuit is filed against them.
The Stern office is also under investigation by the attorney general. Mortgage giants Fannie Mae and Freddie Mac pulled all foreclosure work from the firm.
Two former employees of Stern's office recently said in sworn statements to the attorney general's office that the law firm inflates bills by creating summonses for unknown spouses, unknown tenants and others.
These summonses are then passed along to process serving companies, such as G&Z and ProVest, to be delivered to homeowners, according to their statements.
Foreclosure defense attorneys, legal scholars, consumer advocates and some judges have criticized the practice as a means of racking up fees, which are ultimately passed along to the consumer.
Read on.
BLOOMBERG: Ally Settles Fannie Buyback Demands for $462 Million
Ally Financial Inc., the auto and home lender majority owned by the U.S. government, said its mortgage unit reached a $462 million settlement to resolve repurchase claims by Fannie Mae on $292 billion in home loans.
Ally, formerly known as GMAC Inc., said the settlement covers loans serviced by its GMAC Mortgage unit for Fannie Mae before June 30 and mortgage-backed securities it sold to Fannie Mae. The accord was reached on behalf of Ally’s Residential Capital unit and some of its subsidiaries, the Detroit-based company said today in a statement.
Chief Executive Officer Michael Carpenter, preparing Ally for a share sale that would allow the government to withdraw support, is trying to resolve ResCap’s losses linked to representations and warranties on home loans. Mortgage buyers invoke the clauses to force lenders to buy back faulty loans.
Ally, formerly known as GMAC Inc., said the settlement covers loans serviced by its GMAC Mortgage unit for Fannie Mae before June 30 and mortgage-backed securities it sold to Fannie Mae. The accord was reached on behalf of Ally’s Residential Capital unit and some of its subsidiaries, the Detroit-based company said today in a statement.
Chief Executive Officer Michael Carpenter, preparing Ally for a share sale that would allow the government to withdraw support, is trying to resolve ResCap’s losses linked to representations and warranties on home loans. Mortgage buyers invoke the clauses to force lenders to buy back faulty loans.
Tuesday, December 28, 2010
Biloxi Buzz for Tuesday
Failed South Carolina candidate Greene to try again — Washington (CNN) - Alvin Greene, the surprise Democratic nominee in the South Carolina Senate race against incumbent Republican Sen. Jim DeMint, is trying it again. — This time he is running for a State House seat vacated when Democratic Rep. Cathy Harvin died.
In tough times, Barbour flies high — The Mississippi state plane, a zippy Cessna Citation with a capacity of 12, is a model favored by corporate executives and the wealthy, and its principal passenger, Gov. Haley Barbour, might easily be mistaken for one of them when he arrives
In Michigan, a City Pleads for a Bankruptcy Option — HAMTRAMCK, Mich. — Leaders of this city met for more than seven hours on a Saturday not long ago, searching for something to cut from a budget that has already been cut, over and over. — This time they slashed money for boarding
Sotomayor protests court's refusal of appeals — WASHINGTON — Supreme Court Justice Sonia Sotomayor has set herself apart from colleagues with her fervent statements protesting the majority's refusal to take some appeals, particularly involving prisoners. — Each month, the justices spurn hundreds …
2 Banks Say They Own Same Home
BLOOMINGTON, Ind. -- Bickering between banks over who owns the mortgage to a Bloomington home could force the family living there into foreclosure.
Jonathan Partlow said he was trying to modify his family's loan with Washington Mutual when he received a notice from La Salle Bank seeking to foreclose on his property, 6News' Rafael Sanchez reported.
“We never received a notice, not even a 'You owe us money. Pay us,'" said Partlow, who claims the family has never done business with La Salle Bank.
But both banks maintain they own the home and each claim they're owed more than $1.5 million.
JP Morgan Chase also believes it has a stake in the home because it is seeking to buy bankrupt Washington Mutual and its assets, a deal that's at the center of a separate legal battle.
The Partlows have filed a lawsuit in Monroe County Circuit Court against the banks seeking to stop the foreclosure.
"As a matter of common sense, two banks can't have rights to a single debt,” said the family's attorney, Joe Williams.
Read on.
Jonathan Partlow said he was trying to modify his family's loan with Washington Mutual when he received a notice from La Salle Bank seeking to foreclose on his property, 6News' Rafael Sanchez reported.
“We never received a notice, not even a 'You owe us money. Pay us,'" said Partlow, who claims the family has never done business with La Salle Bank.
But both banks maintain they own the home and each claim they're owed more than $1.5 million.
JP Morgan Chase also believes it has a stake in the home because it is seeking to buy bankrupt Washington Mutual and its assets, a deal that's at the center of a separate legal battle.
The Partlows have filed a lawsuit in Monroe County Circuit Court against the banks seeking to stop the foreclosure.
"As a matter of common sense, two banks can't have rights to a single debt,” said the family's attorney, Joe Williams.
Read on.
State Attorney General BofA lawsuits focus on financial factors
Written by Biloxi
Arizona and Nevada state attorneys general filed a few days ago separate lawsuits against Bank of America. Both state attorney general accused the bank of misleading borrowers seeking loan modifications. Read here on Arizona attorney general's complaint. And read here on Nevada attorney general's complaint. What is interesting is in Arizona complaint, Arizona attorney general characterized Bank of America as ranking “last in virtually every homeowner experience metric” tracked in Treasury’s reports. Unfortunately, Arizona attorney general is correct. According to the Treasury report, Bank of America had the slowest answering speed in four of the six months. You can click here to read more.
There have been so many lawsuits against the banks by homeowners that applied for the Making Home Affordable Program [HAMP] and qualified for the three month plan but only to get rejected for a permanent modification after making the trial plan payments and then get threatened with foreclosure. Let's review the case of Anthony and April Soper. From USA Today:
Bank of America, their mortgage servicer, put them on a HAMP trial payment plan in December that cut their monthly payment by more than half from almost $4,000 to about $1,826.
They say they made their reduced monthly payments early and did everything else that was asked of them. But they didn't get a permanent modification, and they say they don't know why.
Instead, according to a lawsuit they've brought against Bank of America, they are now more than $8,000 behind on a mortgage that had been current 12 months ago. Each of their credit scores has dropped by nearly 100 points. And, they allege, Bank of America has threatened them with foreclosure.
Now, Bank of America said that the Sopers don't have a case because the trial plans are not contracts:
Most of the lawsuits allege that the three- or four-month trial payment plans are contracts, and that Bank of America and other servicers broke them by not giving permanent modifications to homeowners who made their trial payments on time and provided the necessary documentation.One has to question from the Making Home Affordable Program: Is there a contractual agreement with servicer, homeowner, and government? Well, the answer is.. sort of. I looked at the Making Home Affordable Program guidelines. And it says:
Trial loan modifications consistent with these Guidelines may be offered to homeowners beginning on this date, March 4, 2009, and may be considered for acceptance into the Home Affordable Modification Program upon completion of the trial period and other conditions. These Guidelines, however, do not constitute a contract offer binding on the Department of the Treasury.
Servicers have asked courts to dismiss some of the cases, saying the trial plans are not contracts.
Bank of America, which says it plans to seek dismissal of the Soper case, argues in a court filing in a similar case that it must consider borrowers for a HAMP modification, but that it has discretion in granting permanent modifications.
The bank also argues that homeowners have no case because courts have dismissed earlier HAMP-related lawsuits against mortgage servicers. Those cases claimed that in denying some homeowners modifications, the servicers had breached the contracts they made with the Treasury Department when they agreed to participate in HAMP. Courts said homeowners could not sue on those grounds because they weren't parties to the contracts between the government and the servicers.
Lawyers for homeowners say they are now making a different legal argument: that Bank of America and others broke contracts made directly with homeowners.
"Borrowers have said we should be able to enforce the contract between Treasury and mortgage servicers, and many courts have rejected that. Our cases are the first filed that touch on a contract between servicers and borrowers," says Kevin Costello, a lawyer with Roddy Klein & Ryan in Boston, which represents homeowners in cases against Bank of America, JPMorgan Chase and Wells Fargo.
Now from this verbiage, it sounds like the guidelines don't constitute a contract offer binding regarding the trial loan modification on the Treasury Dept. In addition, at the time, banks were encouraged to participate. It was an option. However, all servicers for loans owned or guaranteed by Fannie Mae and Freddie Mac are required to participate in the Making Home Affordable Program. So, if the Sopers' loan was owned by Fannie Mae and Freddie Mac, then Bank of America has a problem. And here is more of the guidelines on the Servicer Incentive Payments and Pay for Success Fees:
Servicers will receive an up-front Servicer Incentive Payment of $1,000 for each eligible modification meeting guidelines established under this initiative. Servicers will also receive Pay for Success payments –as long as the borrower stays in the program – of up to $1,000 each year for up to three years. Similar incentives will be paid for Hope for Homeowner refinances.
So, the servicers received an up-front Servicer Incentive Payment for each eligible homeowner's meeting guidelines and a Pay for Success payments for each homeowner that stays in the program. Does this sound like a contractual agreement? I believe so. And this guideline of Program payment conditions:
No payments under the program to the lender/investor, servicer, or borrower will be made until the servicer has entered into the program agreement with the Treasury’s financial agent.
And the deadline for servicer to enter program agreement was December 31, 2009. By the way, the CEO of Bank of America at that time was Ken Lewis and not Brian Moynihan who is now the current CEO. The Sopers applied for the program in October 2009 which was under Ken Lewis' leadership.
Bank of America as well as all bank servicers who are participating in this program unfortunately are legally binded to this contract. Yes, according to the guidelines, the trial plan isn't a contract. However, if Bank of America and other servicers took the Servicer Incentive Payments of each homeowners that met those modification guidelines and later denied those homeowners a modification, then the servicers would be a serious trouble. But, in the case of the Sopers and other similar cases, this is a contract because the guidelines including incentives for the homeowners who stayed on the program. This case will be interesting as Bank of America and other banks such as Wells Fargo, JP Morgan Chase, Citigroup, and so on try to toss out lawsuits by the homeowners claiming that the banks broke contracts. These are the same banks that took bailout money in the financial crisis. Yet, these same banks are participants and received incentives from the Making Home Affordable Program. All I can say is that the banks need to worry about the Fruit of the poisonous tree doctrine which is a legal metaphor used to describe evidence that is obtained illegally. What will bite the banks who participated in the Making Home Affordable Program with the U.S. Treasury since there was money exchange with the bank servicers and U.S. Treasury such as incentives, it is a contract regardless if it is verbal or written and the upfront fees given to the bank servicers.
However, in the complaints by state Attorney Generals in Arizona and Nevada against Bank of America, the Attorney Generals goes beyond the accusation of misleading borrowers on loan modifications. The state Attorney Generals are focused on the financial factors of Bank of America, a mortgage servicer, benefits in incentives for each HAMP modification paid by the Treasury while continuing to keep a mortgage in a state of default or distress and pushing mortgage loans towards foreclosure. Since Bank of America doesn't own a significant majority of the mortgage loans on which it functions as a servicer, most of Bank of America mortgage loans are owned by a third-party investors and is merely serviced by the servicer such as Bank of America. Do you remember Bank of America Home Loans President Barbara Desoer's testimony to Senate Banking Committee last month? In Ms. Desoer's testimony, Ms. Desoer said that 77% of its servicing portfolio is held by investors, with Fannie Mae and Freddie Mac holding 60% of these loans. And only 23% of its servicing portfolio is owned by Bank of America. Ms. Desoer's alarming testimony only expands other bank servicers to be brought into focus in other states on their financial gain in misleading borrowers in loan modifications. I look for more class action lawsuit cases in misleading borrowers in the HAMP program to come.
Arizona and Nevada state attorneys general filed a few days ago separate lawsuits against Bank of America. Both state attorney general accused the bank of misleading borrowers seeking loan modifications. Read here on Arizona attorney general's complaint. And read here on Nevada attorney general's complaint. What is interesting is in Arizona complaint, Arizona attorney general characterized Bank of America as ranking “last in virtually every homeowner experience metric” tracked in Treasury’s reports. Unfortunately, Arizona attorney general is correct. According to the Treasury report, Bank of America had the slowest answering speed in four of the six months. You can click here to read more.
There have been so many lawsuits against the banks by homeowners that applied for the Making Home Affordable Program [HAMP] and qualified for the three month plan but only to get rejected for a permanent modification after making the trial plan payments and then get threatened with foreclosure. Let's review the case of Anthony and April Soper. From USA Today:
Bank of America, their mortgage servicer, put them on a HAMP trial payment plan in December that cut their monthly payment by more than half from almost $4,000 to about $1,826.
They say they made their reduced monthly payments early and did everything else that was asked of them. But they didn't get a permanent modification, and they say they don't know why.
Instead, according to a lawsuit they've brought against Bank of America, they are now more than $8,000 behind on a mortgage that had been current 12 months ago. Each of their credit scores has dropped by nearly 100 points. And, they allege, Bank of America has threatened them with foreclosure.
Now, Bank of America said that the Sopers don't have a case because the trial plans are not contracts:
Most of the lawsuits allege that the three- or four-month trial payment plans are contracts, and that Bank of America and other servicers broke them by not giving permanent modifications to homeowners who made their trial payments on time and provided the necessary documentation.One has to question from the Making Home Affordable Program: Is there a contractual agreement with servicer, homeowner, and government? Well, the answer is.. sort of. I looked at the Making Home Affordable Program guidelines. And it says:
Trial loan modifications consistent with these Guidelines may be offered to homeowners beginning on this date, March 4, 2009, and may be considered for acceptance into the Home Affordable Modification Program upon completion of the trial period and other conditions. These Guidelines, however, do not constitute a contract offer binding on the Department of the Treasury.
Servicers have asked courts to dismiss some of the cases, saying the trial plans are not contracts.
Bank of America, which says it plans to seek dismissal of the Soper case, argues in a court filing in a similar case that it must consider borrowers for a HAMP modification, but that it has discretion in granting permanent modifications.
The bank also argues that homeowners have no case because courts have dismissed earlier HAMP-related lawsuits against mortgage servicers. Those cases claimed that in denying some homeowners modifications, the servicers had breached the contracts they made with the Treasury Department when they agreed to participate in HAMP. Courts said homeowners could not sue on those grounds because they weren't parties to the contracts between the government and the servicers.
Lawyers for homeowners say they are now making a different legal argument: that Bank of America and others broke contracts made directly with homeowners.
"Borrowers have said we should be able to enforce the contract between Treasury and mortgage servicers, and many courts have rejected that. Our cases are the first filed that touch on a contract between servicers and borrowers," says Kevin Costello, a lawyer with Roddy Klein & Ryan in Boston, which represents homeowners in cases against Bank of America, JPMorgan Chase and Wells Fargo.
Now from this verbiage, it sounds like the guidelines don't constitute a contract offer binding regarding the trial loan modification on the Treasury Dept. In addition, at the time, banks were encouraged to participate. It was an option. However, all servicers for loans owned or guaranteed by Fannie Mae and Freddie Mac are required to participate in the Making Home Affordable Program. So, if the Sopers' loan was owned by Fannie Mae and Freddie Mac, then Bank of America has a problem. And here is more of the guidelines on the Servicer Incentive Payments and Pay for Success Fees:
Servicers will receive an up-front Servicer Incentive Payment of $1,000 for each eligible modification meeting guidelines established under this initiative. Servicers will also receive Pay for Success payments –as long as the borrower stays in the program – of up to $1,000 each year for up to three years. Similar incentives will be paid for Hope for Homeowner refinances.
So, the servicers received an up-front Servicer Incentive Payment for each eligible homeowner's meeting guidelines and a Pay for Success payments for each homeowner that stays in the program. Does this sound like a contractual agreement? I believe so. And this guideline of Program payment conditions:
No payments under the program to the lender/investor, servicer, or borrower will be made until the servicer has entered into the program agreement with the Treasury’s financial agent.
And the deadline for servicer to enter program agreement was December 31, 2009. By the way, the CEO of Bank of America at that time was Ken Lewis and not Brian Moynihan who is now the current CEO. The Sopers applied for the program in October 2009 which was under Ken Lewis' leadership.
Bank of America as well as all bank servicers who are participating in this program unfortunately are legally binded to this contract. Yes, according to the guidelines, the trial plan isn't a contract. However, if Bank of America and other servicers took the Servicer Incentive Payments of each homeowners that met those modification guidelines and later denied those homeowners a modification, then the servicers would be a serious trouble. But, in the case of the Sopers and other similar cases, this is a contract because the guidelines including incentives for the homeowners who stayed on the program. This case will be interesting as Bank of America and other banks such as Wells Fargo, JP Morgan Chase, Citigroup, and so on try to toss out lawsuits by the homeowners claiming that the banks broke contracts. These are the same banks that took bailout money in the financial crisis. Yet, these same banks are participants and received incentives from the Making Home Affordable Program. All I can say is that the banks need to worry about the Fruit of the poisonous tree doctrine which is a legal metaphor used to describe evidence that is obtained illegally. What will bite the banks who participated in the Making Home Affordable Program with the U.S. Treasury since there was money exchange with the bank servicers and U.S. Treasury such as incentives, it is a contract regardless if it is verbal or written and the upfront fees given to the bank servicers.
However, in the complaints by state Attorney Generals in Arizona and Nevada against Bank of America, the Attorney Generals goes beyond the accusation of misleading borrowers on loan modifications. The state Attorney Generals are focused on the financial factors of Bank of America, a mortgage servicer, benefits in incentives for each HAMP modification paid by the Treasury while continuing to keep a mortgage in a state of default or distress and pushing mortgage loans towards foreclosure. Since Bank of America doesn't own a significant majority of the mortgage loans on which it functions as a servicer, most of Bank of America mortgage loans are owned by a third-party investors and is merely serviced by the servicer such as Bank of America. Do you remember Bank of America Home Loans President Barbara Desoer's testimony to Senate Banking Committee last month? In Ms. Desoer's testimony, Ms. Desoer said that 77% of its servicing portfolio is held by investors, with Fannie Mae and Freddie Mac holding 60% of these loans. And only 23% of its servicing portfolio is owned by Bank of America. Ms. Desoer's alarming testimony only expands other bank servicers to be brought into focus in other states on their financial gain in misleading borrowers in loan modifications. I look for more class action lawsuit cases in misleading borrowers in the HAMP program to come.
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