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Former Ameriquest Employee fired after he reported illegal activity, sued under the whistleblower provision of the Sarbanes Oxley Act of 2002

Former Ameriquest Employee fired after he reported illegal activity, sued under the whistleblower provision of the Sarbanes Oxley Act of 2002


Those of you who’ve had any dealings with Ameriquest may find this interesting…


Via William McCloskey

William McCloskey worked for Ameriquest from November 2004 till March 2005. William was fired after he reported illegal activity behind the walls of his Ameriquest branch, which virtually mirrored all of the widespread reports about the company (to local detectives, the PA Attorney General, the S.E.C. and the F.B.I).

William sued Ameriquest Mortgage Company under the whistleblower provision of the Sarbanes Oxley Act of 2002. The act pertained to publicly traded companies and issuers of securities under Section 15(d) and 12h-3 of the Securities and Exchange Act of 1934.

[WJM 7]

© 2010-15 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



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WALLSTREET, BEWARE “MEGALEAKS” HEADING FOR YOU

WALLSTREET, BEWARE “MEGALEAKS” HEADING FOR YOU


WikiLeaks plans to release a U.S. bank’s documents

Mon Nov 29, 6:52 pm ET

WASHINGTON (Reuters) – The founder of whistle-blower website WikiLeaks plans to release tens of thousands of internal documents from a major U.S. bank early next year, Forbes Magazine reported on Monday.

Julian Assange declined in an interview with Forbes to identify the bank, but he said that he expected that the disclosures, which follow his group’s release of U.S. military and diplomatic documents, would lead to investigations.

“We have one related to a bank coming up, that’s a megaleak. It’s not as big a scale as the Iraq material, but it’s either tens or hundreds of thousands of documents depending on how you define it,” Assange said in the interview posted on the Forbes website.

He declined to identify the bank, describing it only as a major U.S. bank that is still in existence.

Asked what he wanted to be the result of the disclosure, he replied: “I’m not sure. It will give a true and representative insight into how banks behave at the executive level in a way that will stimulate investigations and reforms, I presume.”

He compared this release to emails that were unveiled as a result of the collapse of disgraced energy company Enron Corp.

“This will be like that. Yes, there will be some flagrant violations, unethical practices that will be revealed, but it will also be all the supporting decision-making structures and the internal executive ethos … and that’s tremendously valuable,” Assange said.

“You could call it the ecosystem of corruption. But it’s also all the regular decision making that turns a blind eye to and supports unethical practices: the oversight that’s not done, the priorities of executives, how they think they’re fulfilling their own self-interest,” he said.

© 2010-15 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



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Lehman Bankrutpcy: 'Repo 105,' Firm's 'Accounting Gimmick,' Was Like 'A Drug,' Emails Show

Lehman Bankrutpcy: 'Repo 105,' Firm's 'Accounting Gimmick,' Was Like 'A Drug,' Emails Show


Umm could we now say, we told you so?…Now on with Goldman and the rest of the dealers!

Huffington Post   |  Ryan McCarthy First Posted: 03-12-10 10:52 AM Dick Fuld

** UPDATE: Scroll down to see Dylan Ratigan’s segment **

The arcane “accounting gimmick” employed by Lehman Brothers as the firm failed in 2007 and 2008, was like “a drug” propelling the bank to conceal the true nature of its financial health, according to bankruptcy documents released yesterday.

As news organizations pore through the 2,200 pages of documents released by Anton Valukas, the examiner in charge of sifting through the most expensive bankruptcy in history, new details have surfaced about possible criminal actions by Lehman executives.

An executive referred to by Lehman execs as the firm’s “balance sheet” czar — who later went on to become the firm’s COO — likely had knowledge of the firm’s highly creative accounting maneuvers, notes The New York Times. Here’s the NYT:

“I am very aware … it is another drug we [are] on,” Herbert McDade wrote in an April 2008 e-mail cited by the examiner’s report. At other times, he is described as calling for a limit to the number of Repo 105 transactions.

At the center of the controversy is a technique called “Repo 105,” under which Lehman was able to move $50 billion off of its balance sheet in the second quarter of 2008 alone, MarketWatch reports. Here’s more from Market Watch:

[Repo 105 is] essentially a type of secured loan and is booked that way in the accounts — leading to an increase in both assets and liabilities. 

Lehman’s trick was to use a clause in the accounting rules to classify the deal as a sale, even though it was still obliged to repurchase the assets at a later date. That meant the assets disappeared from the balance sheet, and it could use the cash it received to temporarily pay down other liabilities…. [Repo 105] was crucial for maintaining the group’s credit rating as rating agencies and investors began to focus more on leverage and demanded lower risk.

In a series of e-mail messages cited by the examiner, one Lehman executive writes of Repo 105: “It’s basically window-dressing.” Another responds: “I see … so it’s legally do-able but doesn’t look good when we actually do it? Does the rest of the street do it? Also is that why we have so much BS [balance sheet] to Rates Europe?” The first executive replies: “Yes, No and yes. :)”

But these accounting techniques did not sit well with every Lehman executive. The Wall Street Journal passes along this nugget from the examiner’s report, which suggest that Ernst & Young, Lehman’s auditors, were not concerned about the firm’s use of Repo 105. Here’s the WSJ:

In May 2008, a Lehman Senior Vice President, Matthew Lee, wrote a letter to management alleging accounting improprieties;82 in the course of investigating the allegations, Ernst & Young was advised by Lee on June 12, 2008 that Lehman used $50 billion of Repo 105 transactions to temporarily move assets off balance sheet and quarter end.
The next day on June 13, 2008 Ernst & Young met with the Lehman Board Audit Committee but did not advise it about Lee’s assertions, despite an express direction from the Committee to advise on all allegations raised by Lee. Ernst & Young took virtually no action to investigate the Repo 105 allegations. Ernst & Young took no steps to question or challenge the non disclosure by Lehman of its use of $50 billion of temporary, off balance sheet transactions. Colorable claims exist that Ernst & Young did not meet professional standards, both in investigating Lee’s allegations and in connection with its audit and review of Lehman’s financial statements.”

 

NPR Marketplace reporter Alisa Roth said on Friday that it’s a “safe bet” that there will be “another big round of white-collar trials, like we had post-Enron.”

The question will be how far anybody can prove the responsibility extended. The report says “colorable claims” could be made against some Lehman execs and against Ernst & Young, the accountants. And by colorable claims, it means evidence that’s strong enough to potentially get a jury to award damages.

UPDATE: On Friday’s Dylan Ratigan Show, the MSNBC host delved into the Lehman saga with former New York Governor Eliot Spitzer, breaking down the firm’s fraudulent meltdown in easily-understandable terms.

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