Category Archives: Banking industry

Quelle Surprise! Prosecutors Get Tough on Mortgage Fraud….At an Itty Bitty Bank

One of the things that has been galling is watching various officials tasked to protect the public from financial services miscreants is to have them prattle meaningless statistics about how the number of actions of various sorts that they’ve taken is up relative to the previous incumbents. That’s tantamount to a MASH unit tallying up what a great job they did in improving the vaccination rate while not even looking at a huge rise in the mortality rate and questioning whether their response was adequate.

Modern Monetary Theory, Bears 2.0 Style

A Bears-style video on MMT was posted earlier this month. While I like the innovation of a Sharon Stone-ish head and her smashed up interlocutor, and I think this video is well done, I have my doubts as to whether this approach is an effective way to educate people about MMT.

Marcy Wheeler: Lanny Breuer Now Blames 94 US Attorneys for Immunizing Banksters

By Marcy Wheeler. Cross posted from emptywheel

Remarkably, on the same day two Senators (one of them named in the article) reminded Eric Holder that Lanny Breuer said this….

I think I and prosecutors around the country, being responsible, should speak to regulators, should speak to experts, because if I bring a case against institution, and as a result of bringing that case, there’s some huge economic effect — if it creates a ripple effect so that suddenly, counterparties and other financial institutions or other companies that had nothing to do with this are affected badly — it’s a factor we need to know and understand.

Bank of America Foreclosure Reviews: How the Cover-Up Happened (Part IV)

In this post in our Bank of America foreclosure review series, whistleblowers describe how the bank and its independent consultant Promontory Financial Group designed and managed the tests so as to minimize findings of harm to borrowers.

Bank of America Foreclosure Reviews: Why the Cover-Up Happened (Part IIIB)

This post is the second half of Part III in our Bank of America foreclosure review whistleblower series. Part III focuses on how the confusion and high cost of the foreclosure reviews weren’t simply the result of overly ambitious targets and poor design, oversight, and implementation of the reviews. These reviews never could have been done properly due to significant gaps and inaccuracies in the borrower records at Bank of America. That meant the only possible course of action was a cover-up.

Geithner Finally Leaves Treasury, Blurts a Whole Series of Lies on His Way Out

By Nathan Tankus, a student and research assistant at the University of Ottawa. You can follow him on Twitter at @NathanTankus

I can’t emphasize enough how satisfying it is to see Timothy Geithner finally leave government. True, it would have been more enjoyable to see him leave in handcuffs, but I take my satisfaction where I can get it.

Iceland’s Lessons on How to Fix a Bank Crisis

By Delusional Economics, who is determined to cleanse the daily flow of vested interests propaganda to produce a balanced counterpoint. Cross posted from MacroBusiness.

I’m slowly working my way through the material that’s coming out of World Economic Forum in Davos. I tend not to take too much attention of what is said at this particular conference as, in my opinion, it tends to be full of self-serving tripe in the most part.

I did, however, notice a small interview with Icelandic President, Olafur Ragnar Grimsson, which was quite interesting.

So, Why That Mysterious $114 Billion Bank Deposits Withdrawal in Early January?

Lambert Strether writes at Corrente.

It’s with some trepidation that I post something on actual finance, but the $114 billion withdrawal story struck me as strange at the time, and then… it disappeared, as mysteriously as it had arrived. I don’t like patterns like that, or loose ends like that. So I’m putting the the mystery before the NC commentariat, in the hopes that they’ve got better answers not than I do (that would not be hard) but than the business press did in their coverage. As the great Peggy Nooonan once remarked: “It would be irresponsible not to speculate!”

Bill Black: Why the World Economic Forum and Goldman Sachs are Capitalism’s Worst Enemies

Bill Black discusses the basis for giving the “Private Eye” award to Goldman at the counter World Economic Forum gathering at Davos .

Appeals Court Ruling May Nullify Consumer Finance Protection Bureau Rulemakings

A ruling by the Washington, DC federal appeals court in Noel Canning v. NLRB pretty much ends the ability of presidents to make recess appointments, a measure that has been used since 1867. The suit successfully challenged a NLRB rulemaking on the grounds that three of the five directors were recess appointments which meant the NLRB lacked a quorum to give it authority to act.

Ian Fraser: Something Sinister About the Lack of Prosecutions at Lehman Brothers

By Ian Fraser, a financial journalist who blogs at his web site and at qfinance. .

This is the first interview that Chicago lawyer Anton Valukas has given since the publication of his 2,292 page report into the bankrutpcy of Lehman Brothers on March 11th, 2010. At that time, Valukas found strong evidence of financial and accounting fraud designed to deceive investors at the defunct New York-based investment bank. Valukas is surprised, especially given Lehman Brothers’ rampant abuse of Repo 105 to disguise its precarious financial position in the quarters ahead of its September 2008 collapse, that the former Lehman Brothers’ chief executive Dick Fuld or any other Lehman Brothers’ director has been charged with fraud or related offences.

The Garrulous Insolence of Simon Thompson and Anthony Browne

A pair of idiots testing the patience of the Parliamentary Commission on Banking Standards

For Once, Maybe Lying Does Not Pay: DoJ’s Lanny Breuer Resignation Leaked After Frontline Appearance

I am delighted to be proven to be wrong on the premise of the last post, which is that lying pays and it has become so routine that an op-ed writer for a liberal newspaper can point that out without being concerned about the broader ramifications. But this is almost certain to fall into “the exception that proves the rule” category.

Lanny Breuer, former Covington & Burling partner and more recently head of the criminal division at the Department of Justice, resigned abruptly today.

The Persistent Power of Finance, Um, JP Morgan

By C.P. Chandrasekhar, Professor of Economics, School of Social Sciences, Jawaharlal Nehru University, New Delhi. Cross posted from Triple Crisis

In a move that went contrary to what is expected of regulators, the Securities and Exchange Commission of the US approved in mid-December a controversial JP Morgan-created exchange-traded fund (ETF) backed by physical supplies of copper.

Bank of America Foreclosure Reviews: Whistleblowers Reveal Extensive Borrower Harm and Orchestrated Coverup (Part II)

In the executive summary to this series, we provided an overview of OCC/Federal Reserve foreclosure reviews which were abruptly settled at the beginning of January. Critics anticipated that the flawed design, of having supposedly “independent” review firms hired by the banks themselves, meant the reviews were highly unlikely to find much if any damage to homeowners. Leaks during the course of the reviews confirmed these concerns, revealing that the review process at many of the major servicers was chaotic and the reviews were designed and scored so as to make a finding of harm virtually impossible.

As bad as that sounds, the reality is even worse.