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U.S. Set To Sue Big Banks Over Bad Mortgages
MSNBC ^ | September 01, 2011 | NELSON D. SCHWARTZ

Posted on 09/01/2011 9:23:39 PM PDT by Steelfish

U.S. Set To Sue Big Banks Over Bad Mortgages Agency says B of A, JPMorgan Chase, Goldman Sachs, others misrepresented securities

By NELSON D. SCHWARTZ

The federal agency that oversees the mortgage giants Fannie Mae and Freddie Mac is set to file suits against more than a dozen big banks, accusing them of misrepresenting the quality of mortgage securities they assembled and sold at the height of the housing bubble, and seeking billions of dollars in compensation.

The Federal Housing Finance Agency suits, which are expected to be filed in the coming days in federal court, are aimed at Bank of America, JPMorgan Chase, Goldman Sachs and Deutsche Bank, among others, according to three individuals briefed on the matter.

The suits stem from subpoenas the finance agency issued to banks a year ago. If the case is not filed Friday, they said, it will come Tuesday, shortly before a deadline expires for the housing agency to file claims. The suits will argue the banks, which assembled the mortgages and marketed them as securities to investors, failed to perform the due diligence required under securities law and missed evidence that borrowers’ incomes were inflated or falsified. When many borrowers were unable to pay their mortgages, the securities backed by the mortgages quickly lost value.

Fannie and Freddie lost more than $30 billion, in part as a result of the deals, losses that were borne mostly by taxpayers.

In July, the agency filed suit against UBS, another major mortgage securitizer, seeking to recover at least $900 million, and the individuals with knowledge of the case said the new litigation would be similar in scope.

(Excerpt) Read more at msnbc.msn.com ...


TOPICS: Business/Economy; News/Current Events
KEYWORDS: bankofamerica; bigbanks; boa; chase; deutschebank; economy; fannie; fanniemae; fhfa; freddie; freddiemac; goldmansachs; jpmorgan; jpmorganchase; mortgagecrisis; mortgages; police; shakedown; suebigbanks; tarp; taxes; teachers

1 posted on 09/01/2011 9:23:40 PM PDT by Steelfish
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To: Steelfish
seeking billions of dollars in compensation

And who will pay this compensation? It sure as he11 won't be the scumbags working for these banks that ran the scams.

IMHO, serious civil penalties are due. If I'm a bank hotshot and I know the fine will be paid by my customers, no big deal. But if I know I may sit in jail with Brutus looking lovingly at me for several years I may have second thoughts.

2 posted on 09/01/2011 9:29:36 PM PDT by upchuck (Rerun: Think you know hardship? Wait till the dollar is no longer the world's reserve currency.)
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To: Steelfish
This makes no sense to me. The federal government is going to use taxpayer money to sue the same banks that they forced to extend loans to unqualified customers? And now, the banks will have to use private money to defend themselves?

I'm speechless...

3 posted on 09/01/2011 9:32:19 PM PDT by Carling (DeMint to Obama: I want to read the bill, not listen to talking points off a TelePrompter.)
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To: Steelfish

So when will they be going after all of those people who committed mortgage fraud, took constructive receipt of billions of dollars, then defaulted and stuck the rest of us with the bill?? At the very least they should be forced to claim the defaulted amount as ordinary income in the year of the default but I don’t think that is happening widely or there would not be so many so-called “strategic defaults”.


4 posted on 09/01/2011 9:33:59 PM PDT by Bean Counter (Obama got mostly Ds and Fs all through college and law school. Keep saying it.....)
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To: Steelfish
U.S. Set To Sue Big Banks Over Bad Mortgages

For years the Democratic Congress strongarmed the banks into making bad mortgages; threatened them through the First Fag Bawney Fwank and Chris Dodd, Fanny Mae and Feddy Mac, while their RICO partners skimmed hundreds of millions$ off the top. Then they made a deal with the other RICO partners on Wall Street, until the bubble burst?

Those bad mortgages?

Did I get that sort of right?

5 posted on 09/01/2011 9:37:38 PM PDT by Publius6961 (My world was lovely, until it was taken over by parasites.)
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To: Carling

This makes no sense to me.


Same here. Talk about Voodo economics......


6 posted on 09/01/2011 9:40:00 PM PDT by unkus (Silence Is Consent)
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To: Steelfish

I think Obama has realized that bailing the banks out was a mistake and has set out to undo that via lawsuit.


7 posted on 09/01/2011 9:47:02 PM PDT by MetaThought
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To: Steelfish
U.S. Set To Sue Big Banks Over Bad Mortgages

Unless... at least 30 of your executives attend the following Obama '12 fundraising dinners on the following dates...

8 posted on 09/01/2011 9:47:31 PM PDT by DTogo (High time to bring back the Sons of Liberty !!)
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To: Carling

Hey, whatever it takes to try to look good...

It wasn’t me, I swear, I had nothing to do with it...this isn’t what it looks like...

That’s the rats regarding the worst financial debacle we’ve ever seen.


9 posted on 09/01/2011 9:58:27 PM PDT by Aria ( "If we ever forget that we're one nation under God, then we will be a nation gone under.")
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To: Steelfish

What does this Warren Buffet buy out have to do with these lawsuits????


10 posted on 09/01/2011 10:00:39 PM PDT by political1 (Love your neighbors)
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To: Steelfish

That will cement their stability as banks no doubt ... good one Obama! That’s certainly putting your politics out in front


11 posted on 09/01/2011 10:01:20 PM PDT by dila813
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To: Steelfish

Why not sue Sub-Prime Barney while you are at it? He started it all with his bill !


12 posted on 09/01/2011 10:13:30 PM PDT by Graewoulf ( obamatrauma"care" violates the 1890 Sherman Anti-Trust Law.)
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To: Carling

Maybe the banks can get a loan from Emeritus Sheriff of Nottingham Walk-the-Plank-Hank?


13 posted on 09/01/2011 10:17:39 PM PDT by Graewoulf ( obamatrauma"care" violates the 1890 Sherman Anti-Trust Law.)
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To: Graewoulf

And Dodd and Fannie Mae’s Rains, and Maxine Waters.


14 posted on 09/01/2011 10:24:24 PM PDT by Steelfish (ui)
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To: Steelfish; upchuck; Carling; Bean Counter; unkus; Publius6961

I have a dim memory from the days of NYSE specialists making millions through trading stocks assigned to them of a day when the NYSE locked up completely because the back office submerged under the paperwork.

Several years back I held a bunch of secondary market GNMA pools and with that memory sometimes wondered who was keeping track of interest and principal payments on these mortgage pools. All the most outrageous, paranoid thoughts I ever entertained back then have come true. With the current trend of revelations I would not buy any mortgage pool now.


15 posted on 09/01/2011 10:26:34 PM PDT by Retain Mike
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To: Steelfish
About time, they need to sue the Realtors that sold homes to people without jobs and etc. As well. Also the damn appraisers. There is no reason that the tax payers should eat the lose for organized stealing.
16 posted on 09/01/2011 10:46:51 PM PDT by org.whodat (What does the Republican party stand for////??? absolutely nothing.)
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To: Carling
They might start out using private money, but if they're "too big to fail" we'll end up getting stuck with that bill too. They've got us coming and going.

Some of those banks are plenty guilty. They generated and passed on thousands of robo-signed titles, and forged documents are worth toilet paper. Bank of America is holding a lot of that toilet paper, and they're "too big to fail."

I haven't had the stomach to look into my chain of title yet, but I'll probably have to get a real estate lawyer and do so. I'm one of those lucky people whose local bank sold my title to Countrywide, who then dumped it on B of A, so there's a good chance my title is toilet paper, along with many thousands of others. It's a mess that won't be straightened out soon, if ever.

17 posted on 09/01/2011 11:16:06 PM PDT by FlyVet
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To: Steelfish
Well ain't this a fine kettle o' fish. The feral gummint gives the banksters a gazillion dollars of our tax money to offset the losses they incurred making gummint mandated loans. Fannie and Freddie got skinned buying $H!T for loans? Just where were Fannie and Freddie's underwriters while all this was going down? Oh, they had delegated the underwriting of loans to the loan originators. Smart move. Fannie and Freddie were supposed to be guarding the hen house and now they want to blame the fox for sneaking in while they took a nap. Utter BS!

There is so much blame to go around for this sorry episode it boggles the mind. NONE of it the fault of the taxpayers who have been stuck with the tab. Talk about being taken to the cleaners!

18 posted on 09/02/2011 12:03:37 AM PDT by ForGod'sSake (You have only two choices: SUBMIT or RESIST with everything you've got!!!)
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To: Steelfish

It’s a propaganda scheme to keep property taxes dishonestly, improperly and illegally high.


19 posted on 09/02/2011 12:20:11 AM PDT by familyop ("Plan? There ain't no plan!" --Pigkiller, "Beyond Thunderdome")
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To: Steelfish

and scumbag jim johnson...and jamie gorelick.


20 posted on 09/02/2011 12:44:08 AM PDT by biggredd1
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To: All; Steelfish
This looks political, not practical. What am I missing here?

I see circular insanity with an end result of even fewer banks, more federal interference, less willingness to underwrite loans, higher customer fees, reduced economic activity, mammoth trial lawyer paydays and a waste of tax dollars suing on one end after bailing out the other.

21 posted on 09/02/2011 12:54:14 AM PDT by newzjunkey (Will racist demagogue Andre Carson be censured by the House?)
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To: All

When Obama advocates for a new “infrastructure bank” when he’s talking us to death next week, remember how well Fannie Mae, Freddie Mac, Medicare, Social Security and other entities have been run.


22 posted on 09/02/2011 1:02:22 AM PDT by newzjunkey (Will racist demagogue Andre Carson be censured by the House?)
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To: upchuck

That explains all the bailouts - it was to ensure liquidity for future lawsuits - hell of a well-thought-out money laundering scam...


23 posted on 09/02/2011 3:48:21 AM PDT by trebb ("If a man will not work, he should not eat" From 2 Thes 3)
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To: newzjunkey

” ( - - - What am I missing here? - - - )”

What you’re missing is a CYA attempt FINALLY coming out in court.

Emeritus Sheriff of Nottingham Walk-the-Plank-Hank began it in 2008 with TARP and the lawyers at the Just-You-Wait ! Department are continuing this CYA tragic comedy now.

Meanwhile, robo-Congressman Sub-Prime Barney, Fannie, Freddie , FHA, and the government regulators, cower and hope that the CYA program works.

After all, it would undermine consumer confidence significantly if it was ever revealed that NONE of the above did the due diligence required by their job descriptions.

The news is that the FHA and it’s pals went bankrupt in September, 2008, (some call it the Fannie Bubble).

The cover up is that Congress, Cabinet members, Fannie, Freddie, FHA and the regulators have refused to accept ANY responsibility for their criminal inaction, and accusing banks for doing what the sub-prime federal laws required them to do.


24 posted on 09/02/2011 7:27:41 AM PDT by Graewoulf ( obamatrauma"care" violates the 1890 Sherman Anti-Trust Law.)
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