Skip to comments.Exclusive: Too big-to-fail pension insurer agrees to liquidation trust in ResCap NY bankruptcy
Posted on 05/23/2014 4:18:34 AM PDT by Opinionatedtoday
Is a taxpayer bail-out inevitable?
If you think it is only your mortgages and homes which are at stake in the largest bankruptcy in history being heard in the Southern District of New Yorks Bankruptcy Court before Judge Martin Glenn, think again.
Embedded within the claims/creditor section in the simultaneous Chapter 11 bankruptcy filings of 51 residential mortgage companies is Pension Benefit Guaranty Corporation (PBGC).
Established in 1974, PBGC is a federal chartered agency that insures more than 26,000 private-sector pension plans. The agency protects the retirement incomes of over 44 million Americans. As of 2012, PBGC is running a record $36 billion deficit.
A wholly-owned government corporation, PBGC filed claims against all 51 bankrupt residential mortgage companies that are directly or indirectly owned by Residential Capital, also known as ResCap.
Does GMAC, Residential Capital, Residential Funding Company, Residential Asset Security Corporation, Residential Accredit Loan, Residential Asset, Residential Consumer, ditech, Equity Investment, Homecomings Financial, and DOA Holding Properties sound familiar?
Is your pension insured by this pseudo public-private agency, PBGC?
As previously, exclusively reported, at stake in this N.Y. bankruptcy, as of March, 2012, according to court records, are over 2.4 million mortgages and residential mortgage-backed securities (RMBS) representing over 6.2 million Americans, according to U. S. census statistics.
(Excerpt) Read more at marinkapeschmann.com ...
Let NY state bail them out or let them fail.
I recall when the ERISA legislation was zooming through the Congress back in the mid 70s. The Labor Dept was to be the agency to audit these pension plans.
Some balked at this arrangement because the expertise of DOL in auditing consisted of audits of wage and hour complaints. Unfortunately, it was not given to IRS (funding of company plans is a tax deduction) or any of the other financial oversight agencies. So, around 2010 when a report was compiled about why there was a problem with the pension plans, we find this explanation: “The reasons for the failures include (1) the auditor’s inadequate technical training and knowledge, (2) the auditor’s inadequate familiarity with employee benefit plans, (3) a lack of quality control in the audit process, and (4) a failure by the auditor to understand the requirements for limited scope audits.” IMO the real reason for the problem was the corrupt way this whole program was set up: companies wanted little oversight and unions cared nothing about how solvent the plans were because “they were government insured”.
This is exactly why I preferred Michigan bailing out Detroit over the feds bailing them out. It was the best of 2 bad options. Letting the feds (nationwide taxpayers) bail out Detroit would have thrown the floodgates wide open. It gives us the justification and moral high ground to say NO.
Thanks for posting this important story.
check back on that channel for the program from May 23