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California reportedly subpoenas BofA over toxic securities

California reportedly subpoenas BofA over toxic securities


Me thinks this just sunk the Foreclosure Fraud Settlement ship!

California is trying to determine whether BofA and its Countrywide Financial subsidiary sold investments backed by risky mortgages to investors in California under false pretenses, a source says.

Oh Hella Yeah…they did & They everyone knows this!

La Times-

Investigators with the state attorney general’s office have subpoenaed Bank of America Corp. in connection with the sale and marketing of troubled mortgage-backed securities to California investors, according to a person familiar with the probe.

The state is trying to determine whether the bank and its Countrywide Financial subsidiary sold investments backed by risky mortgages to institutional and private investors in California under false pretenses, according to the person, who was not authorized to speak publicly and requested confidentiality.

The subpoenas, which were served Tuesday…

[LA TIMES]

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Wall Street’s New Nightmare: The Next Wave Of Mortgage-Backed Securities Claims

Wall Street’s New Nightmare: The Next Wave Of Mortgage-Backed Securities Claims


In case you want a refresher of Attorney Kathy Patrick you can read a letter from Attorneys for Bank of America, who fired back at her on November 4, 2010 about her “baseless allegations”.

Her $8.5 billion Bank of America settlement over bad mortgage deals was just the beginning. Now, backed by bond giants Pimco and BlackRock, Texas lawyer Kathy Patrick is gearing up for a new legal assault on the financial industry.

[FORBES]

Hmmmm…. Could we get any warmer?

 IN RE WELLS FARGO MORTGAGE-BACKED CERTIFICATES LITIGATION.

Consolidated Class Action No. 09-CV-1376-LHK (PSG).
United States District Court, N.D. California, San Jose Division.
October 13, 2011.

Kathy D. Patrick-Texas Bar No. 15581400, Scott A. Humphries-Texas Bar No. 00796800, Gibbs & Bruns LLP, Houston, Texas, Email: kpatrick@gibbsbruns.com, Email: shumphries@gibbsbruns.com.
.

(Pending Pro Hac Vice Admission), Charles M. Kagay-CBN 73377, Spiegel Liao & Kagay, LLP, San Francisco, California, Email: cmk@slksf.com, Attorneys for Neuberger Berman Europe, Ltd. and Bayerische Landesbank.

ORDER GRANTING APPLICATION FOR ADMISSION OF ATTORNEY ATTORNEY PRO HAC VICE

LUCY H. KOH, District Judge.

Kathy D. Patrick, whose business address and telephone number is 1100 Louisiana Street, Suite 5300, Houston, Texas 77002, (713) 650-8805 and who is an active member in good standing of the bar of Texas having applied in the above-entitled action for admission to practice in the Northern District of California on a pro hac vice basis, representing Neuberger Berman Europe, Ltd., as Agent for Sealink Funding, Ltd. and Bayerische Landesbank.

IT IS HEREBY ORDERED THAT the application Is granted, subject to the terms and conditions of Civil L.R. 11-3. All papers filed by the attorney must indicate appearance pro hac vice. Service of papers upon and communication with co-counsel designated in the application will constitute notice to the party. All future filings in this action are subject to the requirements contained in General Order No. 45, Electronic Case Filing.

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Bankruptcy for Countrywide or Liquidation for BofA?

Bankruptcy for Countrywide or Liquidation for BofA?


Abigail C. Field

The LATimes reported that Brian Moynihan wouldn’t rule out bankruptcy for Bank of America. Chris Whalen urged the bank to go bankrupt. Now rumors are swirling that BofA will try to dodge all Countrywide’s lawsuit liability by putting Countrywide into bankruptcy, saving BofA in the process.

Whether BofA succeeds in ducking Countrywide’s liabilities depends mostly on one question: will the bankruptcy court apply Delaware law, which prizes form over substance, or law like New York or California’s, which looks at substance over form? That choice of law factor is what got BofA off the hook of Countrywide liability in one case, and left it on the hook in another, as detailed by Isaac Gradman at the Subprime Shakeout.  And if you think about it, the idea is incredibly galling.

[REALITY CHECK]

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GASTINEAU v. GIFFORD, BANK OF AMERICA | VERIFIED SHAREHOLDER DERIVATIVE COMPLAINT FOR BREACH OF FIDUCIARY DUTY

GASTINEAU v. GIFFORD, BANK OF AMERICA | VERIFIED SHAREHOLDER DERIVATIVE COMPLAINT FOR BREACH OF FIDUCIARY DUTY


UNITED STATES DISTRICT COURT
DISTRICT OF MASSACHUSETTS

DORIS GASTINEAU, an individual,
Plaintiff,

vs.

CHARLES K. GIFFORD, THOMAS J.
MAY, BRIAN T. MOYNIHAN,
CHARLES O. HOLLIDAY, JR.,
MUKESH D. AMBANI, SUSAN S. BIES,
FRANK P. BRAMBLE, SR., VIRGIS W.
COLBERT, D. PAUL JONES, JR.,
MONICA C. LOZANO, DONALD E.
POWELL, CHARLES O. ROSSOTTI,
ROBERT W. SCULLY, WILLIAM P.
BOARDMAN, BARBARA J. DESOER
and KENNETH D. LEWIS,
Defendants,

and

BANK OF AMERICA CORPORATION,
Nominal Defendant.

[…]

This is a shareholder derivative action brought on behalf and for the benefit of Bank of America against certain of its current and former directors. Bank of America is a global financial services company, and provides consumers, corporations, governments and institutions with a range of financial products and services. Plaintiff seeks to remedy the serious financial and reputational harm that Bank of America has suffered, and will continue to suffer, from the inadequate servicing of its troubled residential mortgage loans. Plaintiff also seeks redress for the Company’s false and  misleading Schedule 14A definitive proxy statement filed with the SEC on March 30, 2011 (the “Proxy”).

[…]

[ipaper docId=60830442 access_key=key-2ojzndxj7anp8ae5fs0v height=600 width=600 /]

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New York Attorney General Steps Up Probe Into BofA-Merrill Disclosures, Seeks Depositions

New York Attorney General Steps Up Probe Into BofA-Merrill Disclosures, Seeks Depositions


WSJ-

Another headache from the financial crisis is flaring back up for Bank of America Corp.

New York state Attorney General Eric Schneiderman has issued subpoenas seeking new depositions from the Charlotte, N.C., bank’s chief executive and other current and former executives, according to people familiar with the situation.

The subpoenas are a sign that Mr. Schneiderman, who became New York’s top law-enforcement official this year, doesn’t intend to drop the civil-fraud investigation of Bank of America begun more than a year ago under predecessor Andrew Cuomo.

Mr. Cuomo, now the governor of New York, accused Bank of America, former Chief …

Continue reading [WALL STREET JOURNAL]

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Bank of America’s “Tasmanian Devil” says we shouldn’t be thinking of our homes as “assets”

Bank of America’s “Tasmanian Devil” says we shouldn’t be thinking of our homes as “assets”


via Mandelman

It should be readily apparent that there are an overabundance of reasons for Bank of America’s CEO, Bryan Moynihan, to be regarded as a massive rear end in a province undeniably replete with rear ends of utterly mammoth proportion.  Even the adjectives in that last sentence don’t begin to do the nature of his posterior justice.

To begin with, let’s just acknowledge that Moynihan is a corporate lawyer.  He graduated in 1981 from Brown University… a history major that co-captained the rugby team.  He then went on to Notre Dame Law School.

In 1993 he went to work at Fleet Boston as deputy general counsel, but after Bank of America acquired Fleet in 2004 Moynihan became the bank’s president of global wealth and investment management, and from October 2007 to December 2008, he served as the bank’s president of global corporate and investment banking.  But from December 2008 to January 2009, Moynihan once again returned to his roots, serving as general counsel for Bank of America, and he became CEO of Merrill Lynch after its oh-so-well-thought-out-and-executed sale to Bank of America in September 2008.


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Bank Of America Chief Rejects Idea Of Reducing Home Loans

Bank Of America Chief Rejects Idea Of Reducing Home Loans


Wow. Talk about brass balls. Lets see you maneuver through this one.

By NELSON D. SCHWARTZ Published: March 8, 2011

.
Showing resistance for the first time against government pressure to write off tens of billions worth of mortgage debt, Bank of America executives said on Tuesday that the idea was unworkable and warned that it would be unfair to borrowers who had managed to stay current on their loans.

“There’s a core problem that if you start to help certain people and don’t help other people, it’s going to be very hard to explain the difference,” said Brian T. Moynihan, the chief executive of Bank of America. “Our duty is to have a fair modification process.”

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Bank of America Lawyers Demand Names in Mortgage-Bond Fight With Investors

Bank of America Lawyers Demand Names in Mortgage-Bond Fight With Investors


By Jody Shenn and David Mildenberg – Nov 5, 2010 4:21 PM ET

Bank of America Corp., responding to the attorney for a bondholder group that’s pushing the bank to repurchase soured home loans, demanded proof the lawyer is authorized to mount an attack on behalf of investors including units of BlackRock Inc. and MetLife Inc.

Wachtell, Lipton, Rosen & Katz’s Theodore N. Mirvis is among lawyers for Bank of America who said in a letter yesterday to Houston-based Gibbs & Bruns LLP’s Kathy Patrick that they want the names of individuals who approved signatures on a letter Patrick sent the Charlotte, North Carolina-based lender last month. They also want to know whether the board of directors for the bondholders Patrick said she represents approved signing of her correspondence.

“Troubling aspects of your letter strongly suggest that it was written for an improper purpose, or in furtherance of an ulterior agenda,” Bank of America’s attorneys wrote, saying they see no need to take action in response to Patrick’s letter.

Investors are stepping up efforts to recoup losses on mortgage bonds, which plummeted in value amid the worst slump in home prices since the 1930s. Bank of America Chief Executive Officer Brian T. Moynihan said Oct. 19 the lender will “defend our shareholders” by disputing any unjustified demands for mortgage buybacks.

Bank of America’s lawyers said they couldn’t determine “whether any investigation of your allegations is warranted” unless Patrick proves her clients own as much of the bonds created by the bank’s Countrywide Financial Corp. unit as they claim. Patrick also needs to show on a deal-by-deal basis how the bank is falling short of its responsibilities in servicing the home loans in the 115 securitizations at issue, they said.

Moynihan’s Surprise

Moynihan, 51, said yesterday that he was surprised by the Oct. 19 letter from investors, which included the Federal Reserve Bank of New York.

Moynihan’s company has resolved other debt disputes with the investors, and he has called BlackRock CEO Larry Fink to discuss the mortgage buyback issue, he said.

Patrick declined to comment.

Jerry Dubrowski, a spokesman for Bank of America, confirmed the letter’s authenticity and declined to comment further.

Lawyers Brian E. Pastuszenski of Goodwin Procter LLP and Marc T.G. Dworsky of Munger, Tolles & Olson LLP also signed the yesterday’s letter to Patrick, which was reported earlier today by the New York Times.

Do Not Print Letter Below (Poor quality and might not come out)

[ipaper docId=41405566 access_key=key-1ajd5uhf38y18hutsz68 height=600 width=600 /]

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Ambac Sues Bank of America Over Countrywide Bonds, CEO Gets A Warning Letter

Ambac Sues Bank of America Over Countrywide Bonds, CEO Gets A Warning Letter


Ambac Sues Bank of America Over Countrywide Bonds

Ambac Assurance Corp. sued Bank of America Corp. over $16.7 billion of mortgage-backed securities, saying the bank’s Countrywide Financial Corp. unit fraudulently induced Ambac to insure bonds backed by improperly made loans.

Ambac found that 97 percent of 6,533 loans it reviewed across 12 securitizations sponsored by Countrywide didn’t conform to the lender’s underwriting guidelines, according to the complaint filed yesterday in New York state Supreme Court. Many of the loans were made to borrowers with limited or no ability to meet their payment obligations, Ambac said.

The lawsuit follows negotiations between Bank of America, which acquired Countrywide in 2008, and Ambac over mounting losses caused by loans made during the early 2000s as U.S. housing prices soared. Ambac has paid $466 million in claims from more than 35,000 Countrywide home-equity loans that have defaulted or been charged off, according to the lawsuit.

“Bank of America probably didn’t settle because they didn’t want to swallow the amount of money that it’s going to take to satisfy Ambac,” said Alan White, a law professor at Valparaiso University who specializes in housing industry issues. “Nobody wants to be left holding the bag.”

Shirley Norton, a spokeswoman for the Charlotte, North Carolina-based lender, and Ambac spokesman Pete Poillon, declined to comment on the lawsuit.

Repurchase of Billions

Repurchases of home loans from buyers and insurers of mortgage securities have already cost the four biggest U.S. lenders $9.8 billion, according to Credit Suisse Group AG. Bank of America has said it faces $11.1 billion of unresolved claims.

MBIA Insurance said it paid more than $459 million in claims stemming from losses on Countrywide-sponsored mortgage- backed bonds, according to a 2008 lawsuit in New York State Supreme Court.

The Ambac case involves 12 Countrywide-sponsored pools of home loans that were created from 2004 to 2006, including nine involving home equity lines of credit and three that involve fixed-amount second-lien loans.

Bank of America should repurchase as much as $20 billion in home loans that were based on wrong or missing information, the Association of Financial Guaranty Insurers said in a Sept. 2 letter to Bank of America Chief Executive Officer Brian Moynihan. More than half of the soured home-equity credit lines and residential mortgages created from 2005 through 2007 that insurers examined were candidates for repurchase, the group said.

Letter Below:

[ipaper docId=40431802 access_key=key-z7j0ixrfvplfrs6zqbf height=600 width=600 /]

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