Settlement

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WELLS FARGO Screws Mother with Two Autistic Children!

WELLS FARGO Screws Mother with Two Autistic Children!

Wells Fargo asked this mother raising autistic twins to send in $2,300 dollars in return to freeze the foreclosure and reach a settlement…they never did. But took her money anyway.

“I’m going to lose everything,” she said, sitting on the front porch of the two story home. Wells Fargo Bank plans to foreclose on the house Thursday. “The American Dream to me is just a lie. I did what I was supposed to do. And they don’t want to help me.”

In Missouri all a lender needs to do is send a letter to foreclose on your house.

FOX2NEWS

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in foreclosure, foreclosure fraud, foreclosure mills, foreclosures, settlement, wells fargo2 Comments

Wells Fargo to Forgive $772 Million in Risky Home Loans

Wells Fargo to Forgive $772 Million in Risky Home Loans

By DANNY KING Posted 6:00 PM 10/06/10

Homeowners struggling to repay adjustable-rate mortgages from Wachovia and World Savings Bank, subsidiaries of Wells Fargo (WFC), got some good news Wednesday. The company has agreed to pay $24 million to settle allegations of deceptive marketing about the risky loans from eight states and also to forgive more than $772 million in outstanding loan balances owed by more than 8,700 borrowers.The states’ probe was spurred by Wachovia’s so-called “Pick-A-Payment” adjustable-rate mortgages. Arizona Attorney General Terry Goddard, who led the investigation, said in a statement that Wachovia — which Wells Fargo acquired after the loans were granted — failed to sufficiently inform borrowers of the risks involved in such loan programs. Wells Fargo said it had already forgiven $3.4 billion in loans as of August.
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See full article from DailyFinance: http://srph.it/cD47FQ
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© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in mortgage, Real Estate, rmbs, securitization, servicers, settlement, wachovia, wells fargo1 Comment

Flawed paperwork gnaws at bank foreclosures

Flawed paperwork gnaws at bank foreclosures

By Jerry Kronenberg
Tuesday, October 5, 2010 –

Bay State lawyers who specialize in fighting home seizures are declaring war on the banking industry, which is admitting that thousands of U.S. foreclosure cases might involve flawed paperwork.

“Foreclosure defense and fraud litigation is going to make (1998’s $200 billion tobacco-industry settlement) look like a grocery-store slip-and-fall case,” Nantucket lawyer Jamie Ranney predicted after Bank of America halted foreclosures in 23 states over the weekend.

The moratorium, which GMAC and JP Morgan Chase launched last week, doesn’t currently include Massachusetts. But Attorney General Martha Coakley has asked lenders to add the Bay State to the list.

Continue reading…BOSTON HERALD

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© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in assignment of mortgage, CONTROL FRAUD, foreclosure, foreclosure fraud, foreclosure mills, foreclosures, robo signers, settlement1 Comment

Congress Needs To ZERO IN On A “Common Thread” To Fannie, Freddie Mortgage Crisis

Congress Needs To ZERO IN On A “Common Thread” To Fannie, Freddie Mortgage Crisis

Anyone can see the “Fiction” that was set into place from all the institutions in this article below. Each one of these named parties as a shareholder utilizes Mortgage Electronic Registration Systems, Inc., yet Washington never mentions this MERS device.

All this talk of false and misleading loans blah blah blah …I mean grab the bull by it’s nuts and put these criminals behind bars. Not just seek refunds! This clean up should also seek Racketeering Indictments.

Congress Seeks Fannie, Freddie Exit as Banks Eat Soured Loans

By Dawn Kopecki – Sep 15, 2010 1:00 AM ET

U.S. lawmakers will grapple today with how to end the bailout of Fannie Mae and Freddie Mac after two years and almost $150 billion, and who pays the bill for bad loans made during the housing boom.

Regulators who seized control of the two mortgage lenders in 2008 are under pressure to stem losses for taxpayers and recoup money from banks that sold faulty loans to Fannie Mae and Freddie Mac — all without hindering the housing market’s recovery. Assistant Treasury Secretary Michael Barr and Edward DeMarco, acting director of the Federal Housing Finance Agency, are scheduled to testify today on their progress at the House Financial Services Committee.

The Obama administration and Congress are weighing the future of the two companies as part of an overhaul of the U.S. housing finance system. Fannie Mae, based in Washington, and Freddie Mac, based in McLean, Virginia, lost $166 billion on guarantees of single-family mortgages from the end of 2007 through the second quarter, according to the FHFA. Treasury Secretary Timothy F. Geithner has promised a comprehensive proposal by early next year.

“The biggest problem in the economy is that we have three or four million too many homes,” said Chris Kotowski, a banking analyst at Oppenheimer & Co. The solution “will take another two or three years to work out until we sop up the excess supply,” Kotowski said.

Loan Clean-Up

The clean-up includes seeking refunds from lenders who sold loans based on false or misleading information, and the two government-backed firms aren’t the only ones demanding buybacks. The Federal Reserve, private mortgage investors and mortgage insurers are combing through loan documents for faulty appraisals, inflated borrower incomes and missing documentation that would support a refund request.

As of the end of the second quarter 2010, Fannie Mae had $4.7 billion in outstanding repurchase requests, and Freddie Mac had $6.4 billion in outstanding repurchase requests. DeMarco said in his prepared testimony that outstanding repurchase requests continue to be “of concern.”

Continue reading…BLOOMBERG

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© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in bank of america, chain in title, CitiGroup, concealment, congress, conspiracy, CONTROL FRAUD, corruption, Credit Suisse, fannie mae, federal reserve board, foreclosure, foreclosure fraud, foreclosure mills, foreclosures, investigation, MERS, MERSCORP, mortgage, MORTGAGE ELECTRONIC REGISTRATION SYSTEMS INC., RICO, scam, servicers, settlement, stopforeclosurefraud.com, sub-prime, trustee, Trusts, us bank, Wall Street2 Comments

Allegations: An Ohio Judge Rigged Foreclosures

Allegations: An Ohio Judge Rigged Foreclosures

Frank Russo charges suggest he corrupted county judges

Published: Thursday, September 09, 2010, 6:10 PM     Updated: Thursday, September 09, 2010, 9:09 PM

Leila Atassi, The Plain Dealer Leila Atassi, The Plain Dealer

CLEVELAND, Ohio — The charges filed Thursday against Cuyahoga County Auditor Frank Russo offer the most detailed description yet of the suspected corrupt activities of two Common Pleas Judges — one of whom is seeking re-election.

Excerpts:

In exchange for his help, Russo wanted control over the outcome of certain [of Terry’s ] civil cases, according to the charges. The docket Terry inherited included numerous civil foreclosure cases involving Russo’s close friend O’Malley, who was representing one of the litigants. American Home Bank was seeking $190,000 in damages from O’Malley’s client.

O’Malley called upon Russo to wield his influence over Terry and convince the judge to deny motions for summary judgment in the case to force it to a settlement.

According to the charges, Russo called Terry in July 2008 and asked, “Did (a county employee) give you the case numbers? … I talked to you about this once before … it’s about denying the motions for summary judgment.”

Yep, I still have the note you gave me,” Terry replied.

“Okay, good, so deny the motions for summary judgment, okay, good. …I just wanted to touch base with you on that,” Russo said.

The following day, Terry reported to Russo that he had followed through on his promise.

I called just to tell you that I took care of those two issues with those two cases that we talked about. … Denied everything.”

Continue Reading…CLEVELAND.com

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in coercion, concealment, conflict of interest, conspiracy, contempt, CONTROL FRAUD, corruption, foreclosure, foreclosure fraud, foreclosures, mortgage, settlement, STOP FORECLOSURE FRAUD0 Comments

FL Judge N. James Turner ‘Inter Alia’ with David J. Stern, ESQ. on His Mother’s Foreclosure

FL Judge N. James Turner ‘Inter Alia’ with David J. Stern, ESQ. on His Mother’s Foreclosure

INQUIRY CONCERNING A JUDGE NO. 09-01 and 09-578
RE: JUDGE N. JAMES TURNER SC09-1182

Illegal Practice of Law

As a sitting judge, Turner was prohibited from engaging in the practice of law. However, he knowingly acted as his mother’s lawyer in a foreclosure proceeding in Dade County.

THE FLORIDA JUDICIAL QUALIFICATIONS COMMISSION’S SECOND
INTERROGATORIES TO JUDGE N. JAMES TURNER states:

JUDGE MOTHER STERNFiled_05-05-2010_JQC_Second_Interrogatories

INTERROGATORY NO. 1: Please specifically itemize and describe the source of funds (in excess of $42,000) that you reported as loans from you to your campaign.

ANSWER:

INTERROGATORY NO. 2: Please specifically itemize and describe all funds, however characterized, you received from your mother (Mignon Gordon) which were used for the campaign for the office you now hold, including, the date(s) any such funds were received, the specific amounts of such funds, and the total of such funds.

ANSWER:

INTERROGATORY NO. 3: Please specifically describe the agreement, arrangement or understanding you had with your mother regarding the funds you received from her which were used in the campaign for the office you now hold.

ANSWER:

INTERROGATORY NO. 4: Please describe all communications (written or parole) you had with David J. Stern, Esquire regarding your mother or the foreclosure litigation brought against her by Citimortgage, Inc. in Dade County, Florida, including the nature, substance and approximate dates of all such communications.

ANSWER:

INTERROGATORY NO. 5: Please describe all communications (written or parole) you had with any person other than David J. Stern, Esquire regarding your mother or the foreclosure litigation brought against her by Citimortgage, Inc. in Dade County, Florida, including the nature, substance and approximate dates of all such communications.

ANSWER:

NOTICE OF THIRD AMENDED CONSOLIDATED
FORMAL CHARGES
states:

JUDGE STERN2Filed_06-18-2010_Amended_Formal_Charges

7. During the campaign for the office you now hold, you knowingly accepted and received a very substantial campaign contribution made for the purpose of influencing the results of the election, whether characterized as a gift or loan, far in excess of the $500 limit established by Ch. 106, Florida Statutes, from your mother (Mignon Gordon) which you used to pay for your campaign, in violation of Chapter 106, Florida Statutes, and Canons 1, 2A and 7C(1) of the Code of Judicial Conduct.

8. As a sitting circuit court judge, on or about November 20, 2009, you knowingly filed a notice of appearance in pending litigation in Dade County, Florida (CitiMortgage, Inc. v. Gordon, Case No. 2009-74992-CA- 01) where you purported to appear to represent your mother in foreclosure proceedings brought against her therein, in violation of Canons 1, 2A and 5G of the Code of Judicial Conduct.

9. As a sitting circuit court judge, you knowingly represented and acted as litigation counsel for your mother in the foreclosure proceeding in Dade County, Florida described above by, inter alia, communicating with counsel for the mortgagee on her behalf, in Osceola County, Florida, in violation of Canons 1, 2A and 5G of the Code of Judicial Conduct.

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in citimortgage, concealment, conflict of interest, conspiracy, CONTROL FRAUD, corruption, discovery, djsp enterprises, foreclosure, foreclosure fraud, foreclosure mills, foreclosures, investigation, Law Offices Of David J. Stern P.A., mortgage, Real Estate, settlement, Violations2 Comments

Florida Bar investigating “Foreclosure Mill” David J. Stern and DJSP Enterprises

Florida Bar investigating “Foreclosure Mill” David J. Stern and DJSP Enterprises

Friday, August 20, 2010

Florida Bar previously disciplined Stern

South Florida Business Journal – by Paul Brinkmann

David J. Stern, an attorney who is the target of a state civil investigation for mortgage fraud complaints, was previously disciplined by the Florida Bar for deceiving the courts and clients about his web of businesses that do legal support work.

The Bar also confirmed Aug. 16 that it is also investigating Stern for numerous allegations of violating attorney regulations, including whether his running of DJSP Enterprises, a publicly traded company, is in compliance.

Stern represents banks that are attempting to foreclose on residential mortgages. Stern, his law firm and DJSP Enterprises are exemplary of the wave of attorneys who have benefitted from the flood of foreclosures that gripped the nation over the last three years.

Stern received a public reprimand in 2002 for billing practices that made it appear he was paying other companies for work on title insurance, when he was actually using in-house staff.

Stern settled the 2002 Bar complaint by consenting to the reprimand before the Bar’s board of governors. In the reprimand, Bar President Tod Aronovitz said Stern’s practices were “misleading” to the courts and foreclosure defendants.

This summer, Stern is facing allegations that he has been similarly misleading to the courts. On Aug. 10, Florida Attorney General Bill McCollum said he was investigating Stern and two other law firms for allegations of unfair and deceptive actions in their handling of foreclosure cases.

Fabrications in the name of speed

It is alleged that the firms, in representing lenders, may have fabricated mortgage assignments in order to speed up the foreclosure process.

Stern’s attorney, Jeffrey Tew, has brushed off McCollum’s announcement by saying that Stern handled 100,000 cases in the last few years, and a few mistakes were inevitable.

Tew said this week that resolving the 2002 Bar complaint also involved Stern agreeing to have all staff who perform title insurance work to be on the payroll of a separate title company.

Tew, of Miami-based Tew Cardenas LLP, said any alleged deception from the 2002 complaint “was inadvertent on David’s part,” and “there hasn’t been any Bar discipline since 2002.”

Tew said Stern employs 1,200 paralegals in Plantation, and may have turned to using staff in Manila, Philippines, partly due to a lack of space.

“The Bar has approved the use of paralegals in other countries,” Tew said. “DJSP has a group of paralegals in Manila. He doesn’t necessarily have room for more here, and it may be partly related to pay scales also.”

Continue reading… Florida Bar previously disciplined Stern – South Florida Business Journal

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RELATED STORIES:

Full Deposition of David J. Stern’s Notary | Para Legal Shannon Smith

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STERN’S CHERYL SAMONS| SHANNON SMITH Assignment Of Mortgage| NOTARY FRAUD!

[ipaper docId=34497819 access_key=key-1v3hmd3whnpyout9rn6l height=600 width=600 /]

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in concealment, conflict of interest, CONTROL FRAUD, corruption, djsp enterprises, foreclosure, foreclosure fraud, foreclosure mills, foreclosures, forgery, investigation, Law Offices Of David J. Stern P.A., Mortgage Foreclosure Fraud, notary fraud, settlement, stock, STOP FORECLOSURE FRAUD, Violations0 Comments

Judge rejects Citigroup’s $75 million settlement with SEC

Judge rejects Citigroup’s $75 million settlement with SEC

Washington Post Staff Writer
Monday, August 16, 2010; 7:32 PM

A federal judge on Monday refused to accept a $75 million settlement between the Securities and Exchange Commission and Citigroup, the second time in a year that the agency’s attempt to sanction a major bank was foiled by a judge with questions about the appropriateness of the agreement.

Judge Ellen S. Huvelle of the U.S. District Court of the District of Columbia raised questions during a hearing Monday about why the SEC chose to penalize Citigroup financially when it’s the company’s shareholders who will ultimately bear the price of the sanction, according to lawyers who were present. She also asked why the agency decided to charge only two executives with wrongdoing when other more senior executives were involved with Citigroup’s actions, the lawyers said.

Huvelle demanded more information from SEC and Citigroup and scheduled another hearing for Sept. 24.

Continue Reading…Washington Post

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in CitiGroup, conspiracy, CONTROL FRAUD, corruption, mbs, reversed court decision, scam, securitization, settlement1 Comment

WALL STREET FINES: “LARGE PONZI SCHEME”

WALL STREET FINES: “LARGE PONZI SCHEME”

CONGRESS IS COVERING UP! SHAM…SCANDAL!

Janet Tavakoli of Tavakoli Structured Finance tells what she thinks of recent fines the SEC has imposed on Wall Street giants and where she would like future investigations take place.

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in bogus, CitiGroup, concealment, conspiracy, CONTROL FRAUD, corruption, foreclosure, foreclosure fraud, foreclosures, goldman sachs, mbs, originator, Real Estate, S.E.C., scam, securitization, servicers, settlement, sub-prime1 Comment

Citi to pay $73 million for misleading investors

Citi to pay $73 million for misleading investors

By David Ellis, staff writer July 29, 2010: 3:57 PM ET

NEW YORK (CNNMoney.com) — Citigroup said Thursday it would pay $73 million to settle charges by the Securities and Exchange Commission that the bank, as well as two of its executives, misled investors about the company’s exposure to the subprime mortgage market.

Wall Street’s top regulator said Citigroup repeatedly made misleading statements in investor presentations and in public filings about the actual size of assets it controlled that were backed by subprime mortgages.

Between July and mid-October 2007, the company maintained its holdings of what have now been dubbed “toxic assets”, stood at $13 billion, when in fact the number was closer to $50 billion, according to the SEC.

“The rules of financial disclosure are simple — if you choose to speak, speak in full and not in half-truths,” Robert Khuzami, director of the SEC’s Division of Enforcement, said in a statement.

Continue reading….CNN

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in citi, CitiGroup, concealment, settlement, sub-prime1 Comment

FLORIDA| Watch out for Conciliation| Mediation Scam

FLORIDA| Watch out for Conciliation| Mediation Scam

DinSFLA here: MEDIATION without the true lenders disclosed may be an issue later…these mills have no right to play middlemen to no one! You must make sure who the real parties are before, during and after foreclosure!

Florida Default Group is emailing foreclosure defense attorneys with emails stating “Per your request, conciliation will be scheduled for your client…” that is how the are scamming even REPRESENTED defendants out of their right to a third party mediation (not that they are going to work anyway).

As I myself have witnessed on many occasions, some mill attorneys, or LOCAL COUNSEL, like Peter Porcaro local counsel for Stern’s office, bring pro se defendants out of the courtroom, smooth talk them into an agreement where there is an “extended sale date 120 days into the future, and an agreement for “conciliation” (which differs from mediation because mediation for primary residences cost the plaintiff $750 each and also there is a mediator) and a waiver of mediation. Conciliation is at no cost to the plaintiff and is between the two parties without a mediator. There is no explanation of mediation vs conciliation and no telling that the FL Supreme Court mandates mediation unless it is waived. There is no acknowledgment of months if not years of frustrated attempts at “conciliation” in terms of loan mods or short sales or deeds in lieu and how the defendants have a right to mediation. If any issues regarding the veracity and/or authenticity of the documents in the court file are raised, the answer given in these hallway dirty dealings, is “I’m not involved with that. I don’t work for their office.”

The same thing happens with all the mills. Attached is what the defendant in a Marshall Watson case walked away with…..just read it to see …………

See for yourselves. Stand outside of courtroom 10H or the other “foreclosure mill courtrooms” and watch this play out.

Sincerely,
Lisa Epstein
ForeclosureHamlet.org

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in coercion, conspiracy, investigation, Law Offices Of David J. Stern P.A., law offices of Marshall C. Watson pa, non disclosure, settlement, STOP FORECLOSURE FRAUD1 Comment

SEC’s internal watchdog investigates timing of Goldman subprime fraud case settlement

SEC’s internal watchdog investigates timing of Goldman subprime fraud case settlement

The US financial regulator’s own internal watchdog has widened his investigation of the civil fraud lawsuit brought against Goldman Sachs to include a focus on the timing of last week’s $550m (£356m) settlement.

By James Quinn
Published: 6:00AM BST 24 Jul 2010

David Kotz, inspector general of the Securities and Exchange Commission, has said he is looking into the timing of Goldman’s settlement with the regulator, coming as it did on the same day that the US passed its wide-ranging financial reform bill.

Mr Kotz’s investigation to date has focused on whether politics played a part in the SEC bringing the case against Goldman in the first place.

Continue here…Telegraph

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in conspiracy, goldman sachs, S.E.C., securitization, settlement, Wall Street1 Comment

DJSP Enterprises, Inc. DJSP 401(k) / ERISA Stock Fraud

DJSP Enterprises, Inc. DJSP 401(k) / ERISA Stock Fraud

VIA: LawyersandSettlements.com

DJSP Enterprises, Inc. has been accused of securities fraud. If you are a current or former employee or are a member of any of DJSP Enterprises, Inc. investment plans or profit sharing retirement plans you may be included in this possible DJSP Enterprises, Inc. 401(k) or Employee Retirement Income Security Act (ERISA) class action. If you purchased or held DJSP Enterprises, Inc. stock in one of those plans during the periods Mar-16-10 to May-27-10, you may have a claim.

Under ERISA, DJSP Enterprises, Inc. employees can file a lawsuit against the company for putting stock options at risk. DJSP Enterprises, Inc. employees have a claim if they can prove their employer violated its fiduciary duty to its employees. Fiduciary duty refers to a company’s responsibility to the people who invest in it. If an employer puts the company’s interest ahead of the investors’, it has broken its fiduciary duty. A fiduciary is a person that exercises discretion over the management of plan assets or exercises discretionary control over the administration of the plan.

ERISA is a federal law that sets minimum standards for pension and health plans set up by private businesses. ERISA was designed to protect people who participate in employee benefit plans, including employees with stock options in a company. Stock options are a form of compensation in which employees are given the opportunity to purchase shares of the company stock at a certain price.

DJSP Enterprises, Inc. 401(k) / ERISA Legal Help

If you have suffered from DJSP Enterprises, Inc. 401(k) plan losses, you may qualify for damages or remedies that may be awarded in a possible DJSP Enterprises, Inc. ERISA class action lawsuit. Please click the link below to submit your complaint and we will have a lawyer review your ERISA complaint. If you are NOT a current or former employee of this company, please use this form to register your complaint. Thank you.

Last updated on Jul-21-10


© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in case, djsp enterprises, Law Offices Of David J. Stern P.A., lawsuit, settlement1 Comment

Defendants’ Motion for Summary Judgment on the Entirety of Plaintiff’s Complaint

Defendants’ Motion for Summary Judgment on the Entirety of Plaintiff’s Complaint

Via: Kenneth Eric Trent, Attorney at Law Fort Lauderdale, FL

This is the follow up to the latest Depositions posted on SFF taken from The Law Offices of David J. Sterns’ employees Cheryl Samons and Shannon Smith.

[ipaper docId=34550572 access_key=key-2cbgnrr6653palfl8a4w height=600 width=600 /]

RELATED STORIES:

Full Deposition of David J. Stern’s Notary | Para Legal Shannon Smith

STERN’S CHERYL SAMONS| SHANNON SMITH Assignment Of Mortgage| NOTARY FRAUD!

Take Two: *New* Full Deposition of Law Office of David J. Stern’s Cheryl Samons

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in aurora loan servicing, citimortgage, conflict of interest, CONTROL FRAUD, corruption, dismissed, djsp enterprises, foreclosure, foreclosure fraud, foreclosure mills, foreclosures, forgery, Law Offices Of David J. Stern P.A., MERS, MORTGAGE ELECTRONIC REGISTRATION SYSTEMS INC., Notary, notary fraud, robo signers, settlement, STOP FORECLOSURE FRAUD1 Comment

Goldman to pay record $550 million to settle CDO-related charges

Goldman to pay record $550 million to settle CDO-related charges

Firm Acknowledges CDO Marketing Materials Were Incomplete and Should Have Revealed Paulson’s Role

FOR IMMEDIATE RELEASE
2010-123

View  high-resolution photo of Robert Khuzami, Director, SEC Enforcement

“This settlement is a stark lesson to Wall Street firms that no product is too complex, and no investor too sophisticated, to avoid a heavy price if a firm violates the fundamental principles of honest treatment and fair dealing.”

Robert Khuzami
Director
SEC Enforcement

Washington, D.C., July 15, 2010 — The Securities and Exchange Commission today announced that Goldman, Sachs & Co. will pay $550 million and reform its business practices to settle SEC charges that Goldman misled investors in a subprime mortgage product just as the U.S. housing market was starting to collapse.

In agreeing to the SEC’s largest-ever penalty paid by a Wall Street firm, Goldman also acknowledged that its marketing materials for the subprime product contained incomplete information.

In its April 16 complaint, the SEC alleged that Goldman misstated and omitted key facts regarding a synthetic collateralized debt obligation (CDO) it marketed that hinged on the performance of subprime residential mortgage-backed securities. Goldman failed to disclose to investors vital information about the CDO, known as ABACUS 2007-AC1, particularly the role that hedge fund Paulson & Co. Inc. played in the portfolio selection process and the fact that Paulson had taken a short position against the CDO.

In settlement papers submitted to the U.S. District Court for the Southern District of New York, Goldman made the following acknowledgement:

Goldman acknowledges that the marketing materials for the ABACUS 2007-AC1 transaction contained incomplete information. In particular, it was a mistake for the Goldman marketing materials to state that the reference portfolio was “selected by” ACA Management LLC without disclosing the role of Paulson & Co. Inc. in the portfolio selection process and that Paulson’s economic interests were adverse to CDO investors. Goldman regrets that the marketing materials did not contain that disclosure.

“Half a billion dollars is the largest penalty ever assessed against a financial services firm in the history of the SEC,” said Robert Khuzami, Director of the SEC’s Division of Enforcement. “This settlement is a stark lesson to Wall Street firms that no product is too complex, and no investor too sophisticated, to avoid a heavy price if a firm violates the fundamental principles of honest treatment and fair dealing.”

Lorin L. Reisner, Deputy Director of the SEC’s Division of Enforcement, added, “The unmistakable message of this lawsuit and today’s settlement is that half-truths and deception cannot be tolerated and that the integrity of the securities markets depends on all market participants acting with uncompromising adherence to the requirements of truthfulness and honesty.”

Goldman agreed to settle the SEC’s charges without admitting or denying the allegations by consenting to the entry of a final judgment that provides for a permanent injunction from violations of the antifraud provisions of the Securities Act of 1933. Of the $550 million to be paid by Goldman in the settlement, $250 million would be returned to harmed investors through a Fair Fund distribution and $300 million would be paid to the U.S. Treasury.

The landmark settlement also requires remedial action by Goldman in its review and approval of offerings of certain mortgage securities. This includes the role and responsibilities of internal legal counsel, compliance personnel, and outside counsel in the review of written marketing materials for such offerings. The settlement also requires additional education and training of Goldman employees in this area of the firm’s business. In the settlement, Goldman acknowledged that it is presently conducting a comprehensive, firm-wide review of its business standards, which the SEC has taken into account in connection with the settlement of this matter.

The settlement is subject to approval by the Honorable Barbara S. Jones, United Sates District Judge for the Southern District of New York.

Today’s settlement, if approved by Judge Jones, resolves the SEC’s enforcement action against Goldman related to the ABACUS 2007-AC1 CDO. It does not settle any other past, current or future SEC investigations against the firm. Meanwhile, the SEC’s litigation continues against Fabrice Tourre, a vice president at Goldman.

The SEC investigation that led to the filing and settlement of this enforcement action was conducted by the Enforcement Division’s Structured and New Products Unit, led by Kenneth Lench and Reid Muoio, and including Jason Anthony, N. Creola Kelly, Melissa Lamb, and Jeffrey Leasure. Additionally, together with Deputy Director Reisner, Richard Simpson, David Gottesman, and Jeffrey Tao have been handling the litigation.

# # #

For more information about this enforcement action, contact:

Robert S. Khuzami
Director, SEC Enforcement Division
(202) 551-4500

Lorin L. Reisner
Deputy Director, SEC Enforcement Division
(202) 551-4787

Kenneth R. Lench
Chief of Structured and New Products Unit, SEC Enforcement Division
(202) 551-4938

http://www.sec.gov/news/press/2010/2010-123.htm

[ipaper docId=34392476 access_key=key-17ciw5w4gbw6m59368vt height=600 width=600 /]


© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in goldman sachs, S.E.C., settlement1 Comment

The $108 million in the Countrywide case is the tip of the iceberg

The $108 million in the Countrywide case is the tip of the iceberg

Finally, Borrowers Score Points

By GRETCHEN MORGENSON NYTimes
Published: June 11, 2010

WHILE the wheels of justice have turned very slowly in the years since our nation’s financiers and regulators nearly cratered our economy, the Federal Trade Commission’s settlement last Monday with Countrywide Home Loans suggests that they haven’t entirely ground to a halt.

Countrywide, now a unit of Bank of America, was once led by Angelo Mozilo and was the nation’s largest mortgage lender in the glorious, pre-crisis days of the housing boom. But it was also a predatory institution, and the F.T.C., citing Countrywide’s serial abuse of troubled borrowers, extracted a $108 million fine from Bank of America last week.

That money will go back to some 200,000 customers whom Countrywide forced to pay outsized fees for foreclosure services. These included billing a borrower $300 to have a property’s lawn mowed and levying $2,500 in trustees’ fees on another borrower, when the going rate for that service was about $600.

Though Countrywide’s mortgage contracts specifically barred such practices, they served the company well by generating income during downturns when it was harder to keep making money off new mortgages. This “counter-cyclical diversification strategy,” as Countrywide called it, was designed to “extract the last dollar out of the pockets of the most desperate consumers,” said Jon Leibowitz, the F.T.C. chairman.

[NYTIMES]

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in countrywide, foreclosure, foreclosure fraud, foreclosures, settlement0 Comments


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