Skip to comments.U.S. Set To Sue Big Banks Over Bad Mortgages
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 $900 million, and the individuals with knowledge of the case said the new litigation would be similar in scope.
(Excerpt) Read more at msnbc.msn.com ...
And who will pay this compensation? It sure as he11 won't be the scumbags working for these banks that ran the scams.
IMHO, serious civil penalties are due. If I'm a bank hotshot and I know the fine will be paid by my customers, no big deal. But if I know I may sit in jail with Brutus looking lovingly at me for several years I may have second thoughts.
So when will they be going after all of those people who committed mortgage fraud, took constructive receipt of billions of dollars, then defaulted and stuck the rest of us with the bill?? At the very least they should be forced to claim the defaulted amount as ordinary income in the year of the default but I don’t think that is happening widely or there would not be so many so-called “strategic defaults”.
For years the Democratic Congress strongarmed the banks into making bad mortgages; threatened them through the First Fag Bawney Fwank and Chris Dodd, Fanny Mae and Feddy Mac, while their RICO partners skimmed hundreds of millions$ 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?
This makes no sense to me.
Same here. Talk about Voodo economics......
I think Obama has realized that bailing the banks out was a mistake and has set out to undo that via lawsuit.
Unless... at least 30 of your executives attend the following Obama '12 fundraising dinners on the following dates...
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.
What does this Warren Buffet buy out have to do with these lawsuits????
That will cement their stability as banks no doubt ... good one Obama! That’s certainly putting your politics out in front
Why not sue Sub-Prime Barney while you are at it? He started it all with his bill !
Maybe the banks can get a loan from Emeritus Sheriff of Nottingham Walk-the-Plank-Hank?
And Dodd and Fannie Mae’s Rains, and Maxine Waters.
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.
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.
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!
It’s a propaganda scheme to keep property taxes dishonestly, improperly and illegally high.
and scumbag jim johnson...and jamie gorelick.
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.
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.
That explains all the bailouts - it was to ensure liquidity for future lawsuits - hell of a well-thought-out money laundering scam...
” ( - - - 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.