Sept. 2nd, 2011
From the NY Times:
"The federal agency that oversees the mortgage giants Fannie Maeand 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."
Read more HERE
Showing posts with label securities. Show all posts
Showing posts with label securities. Show all posts
Friday, September 2, 2011
Friday, August 19, 2011
Protecting Those Responsible
Aug 19th, 2011
Well, this is bad. Carre Johnson reports for NPR:
"A staff member at the Securities and Exchange Commission has complained to Congress that thousands of investigative documents have been destroyed by the agency.
Longtime SEC staffer Darcy Flynn says some of those missing papers relate to huge investment banks under the spotlight for their role in the 2008 mortgage crisis.
Flynn is asking Congress to protect him from retaliation after blowing the whistle on document destruction that he says stretches back for 20 years. Some of the missing files involve early-stage inquiries the agency made into the workings of Goldman Sachs, Bank of America and Lehman Bros.
"The same big banks that delivered us the 2008 financial crisis," says Gary Aguirre, a lawyer in San Diego who brought Flynn's allegations to the attention of Congress.
Aguirre, a former SEC whistle-blower himself, is one of many people who are calling for more accountability on Wall Street and for more action from the SEC.
"I just think that when you've destroyed 9,000 files of investigations, it makes sweeping under the table a lot easier," he says."
One has to wonder whether there was a tone in Aguirre's voice of either fatalism or anger that doesn't wholly translate into print when he made that last remark.
It is worth noting that not one Republican in the 112th congress has recommended de-funding the SEC, much less "auditing" them. The Rs have, however, been fighting to prevent the reestablishment of regulations such as the "uptick rule," without which our markets have been on a rollercoaster for nearly two weeks.
Well, this is bad. Carre Johnson reports for NPR:
Longtime SEC staffer Darcy Flynn says some of those missing papers relate to huge investment banks under the spotlight for their role in the 2008 mortgage crisis.
Flynn is asking Congress to protect him from retaliation after blowing the whistle on document destruction that he says stretches back for 20 years. Some of the missing files involve early-stage inquiries the agency made into the workings of Goldman Sachs, Bank of America and Lehman Bros.
"The same big banks that delivered us the 2008 financial crisis," says Gary Aguirre, a lawyer in San Diego who brought Flynn's allegations to the attention of Congress.
Aguirre, a former SEC whistle-blower himself, is one of many people who are calling for more accountability on Wall Street and for more action from the SEC.
"I just think that when you've destroyed 9,000 files of investigations, it makes sweeping under the table a lot easier," he says."
One has to wonder whether there was a tone in Aguirre's voice of either fatalism or anger that doesn't wholly translate into print when he made that last remark.
It is worth noting that not one Republican in the 112th congress has recommended de-funding the SEC, much less "auditing" them. The Rs have, however, been fighting to prevent the reestablishment of regulations such as the "uptick rule," without which our markets have been on a rollercoaster for nearly two weeks.
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