Banking

  • September 29, 2014

    Firm Owner Admits Paying $1M In Bribes To JPMorgan, GMAC

    The owner of two San Diego-based mortgage investment firms admitted in California federal court on Friday that he paid $1 million in bribes to "insiders" at JP Morgan Chase Bank NA, GMAC Mortgage LLC and National City Bank in order to win bids for mortgage loans sold on the secondary market, according to federal prosecutors.

  • September 29, 2014

    Pa. Jury Finds Ex-Bank Head Guilty Of Embezzling Funds

    A federal Pennsylvania jury on Friday found a former director of Metropolitan Savings Bank guilty of embezzling about $350,000 in bank funds, according to prosecutors.

  • September 29, 2014

    UBS In Forex-Rigging Settlement Talks, Warns Of Fines

    UBS AG told investors Monday it could face a “material” fine by regulators over its alleged role in a scheme to manipulate the $5.3 trillion global foreign exchange market, saying that it was in settlement talks with at least one agency.

  • September 29, 2014

    Citi Unit, Others Get Thornburg Trustee's $2B Suit Trimmed

    A Maryland bankruptcy judge has pared a nearly $2 billion suit by Thornburg Mortgage Inc.'s trustee alleging that units of Citigroup Inc. and other banks made unfair margin calls and other improper agreements that brought the mortgage lender to its knees, finding that the agreements central to some of the claims are safe-harbored.

  • September 29, 2014

    BNP Paribas Chair To Resign As Bank Moves Past Sanctions

    BNP Paribas' chairman and director said he will be stepping down from the French bank, which has a presence in 75 countries and more than 180,000 employees, just three months after BNP agreed to pay $8.97 billion and plead guilty to violating economic sanctions.

  • September 29, 2014

    HSBC Foreclosure Suit Remanded Amid Factual Dispute

    A Pennsylvania appeals court on Monday remanded a summary judgment for $609,367 against a homeowner who hadn’t paid her mortgage loans to HSBC Bank NA, finding the record unclear on whether the bank provided her with notices.

  • September 29, 2014

    Morgan Stanley, Deutsche Target Force-Placed Class Action

    Morgan Stanley, Deutsche Bank National Trust Company, other lenders and Assurant Inc. urged a California federal judge Monday to toss a putative class action alleging they ripped off thousands of homeowners with overpriced force-placed insurance, saying the plaintiff never paid for the insurance and thus wasn't harmed.

  • September 29, 2014

    AIG Bailout Overreached Fed Authority, Former CEO Says

    The federal government exceeded its authority when it took a majority stake in American International Group Inc. as part of a massive 2008 bailout, attorneys for the firm’s former CEO argued Monday at the beginning of a trial in a $55.5 billion lawsuit alleging the deal bilked shareholders.

  • September 29, 2014

    Shuttered Miami Firm Escapes Negligence Suit For Now

    A Florida state judge on Friday tossed a lawsuit claiming negligence by shuttered Miami law firm Tew Cardenas LLP for its handling of litigation to enforce $80 million in notes, saying plaintiff FBK Associates must refile its allegations more specifically to proceed.

  • September 29, 2014

    Argentina Held In Contempt For Debt Bypass Plan

    A New York federal judge on Monday held Argentina in contempt of court for taking steps to evade his orders that bondholders who agreed to debt restructurings can only be paid if holdout hedge funds are also compensated, calling such plans illegal.

  • September 29, 2014

    Fed Workers Lose Class Cert. Bid In 16-Year Race Bias Suit

    A Washington, D.C., federal judge on Monday refused to certify a putative class of black and Native American secretaries and clerical workers in a contentious, 16-year lawsuit alleging the Board of Governors of the Federal Reserve System racially discriminated against them, saying the claims are individualized.

  • September 29, 2014

    Flagstar To Pay $37.5M In Mortgage Servicing Settlement

    Flagstar Bank FSB has agreed to pay $37.5 million to settle allegations that it prevented borrowers from accessing foreclosure relief and modifying their mortgage loans, the U.S. Consumer Financial Protection Bureau said on Monday.

  • September 29, 2014

    High Court Reverses Decision To Hear IndyMac Appeal

    The Supreme Court on Monday revoked its granting of cert in a dispute over whether a tolling provision should apply to certain securities suits, just days after the litigants said a settlement in the underlying class action wouldn’t impact the appeal.

  • September 29, 2014

    Lloyds Fires 8, Axes $4.9M In Bonuses Over Libor Rigging

    Lloyds Banking Group PLC said on Monday that it had terminated eight employees and stopped payment of £3 million (about $4.9 million) in bonuses following its $370 million settlement of U.S. and U.K. authorities' claims that its traders manipulated the London Interbank Offered Rate.

  • September 29, 2014

    2 Ex-Wells Fargo Employees Charged With Insider Trading

    The U.S. Securities and Exchange Commission announced on Monday that it has charged two former Wells Fargo employees, a research analyst and a trader, with sharing information that yielded improper gains when it was traded on before the release of market-moving research reports.

  • September 29, 2014

    Morgan Stanley Slams Bipolar Ex-Worker's ADA Appeal

    Morgan Stanley Smith Barney LLC has urged the U.S. Supreme Court to let stand an Eleventh Circuit ruling that the Americans with Disabilities Act does not protect a former financial adviser with bipolar disorder from termination for improperly taking a company computer containing sensitive data during a manic episode.

  • September 29, 2014

    SEC Hits BofA With $7.65M Fine Over Merrill Deal

    Bank of America Corp. has agreed to pay the U.S. Securities and Exchange Commission $7.65 million to settle charges it violated internal controls and recordkeeping provisions after assuming a large portfolio of structured notes when it bought Merrill Lynch & Co. Inc. in 2009, the SEC said Monday.

  • September 26, 2014

    MBIA Lands 2nd Shot At JPMorgan In $168M MBS Suit

    MBIA Insurance Corp. will get another shot at JPMorgan Chase & Co. in its suit over $168 million in payments it had to make to investors in a Bear Stearns-sold mortgage-backed securities trust that busted in the housing collapse, according to a New York state court decision entered Friday.

  • September 26, 2014

    Lehman Bros. Says It Was Cheated Out Of $1.9M Swap Gain

    Lehman Brothers Holdings Inc. accused Raymond James Financial Inc. of moving in on one of its swap agreements just after its 2008 collapse and taking a windfall of $1.9 million that the bankrupt financial institution now wants back, according to a lawsuit filed in New York federal court on Thursday.

  • September 26, 2014

    Citigroup Cleared To Make One-Time Argentine Bond Payment

    The New York federal judge overseeing the fight between hedge funds and Argentina over payments on the country’s sovereign debt on Friday said Citigroup Inc. could make a scheduled payment on around $8.4 billion in bonds governed by Argentine law.

Expert Analysis

  • Should FIRREA Whistleblower Bounties Be Higher?

    Andrew W. Schilling

    The Financial Institutions Reform, Recovery, and Enforcement Act’s whistleblower bounties at False Claims Act levels could lead to absurdly high and wastefully excessive awards. At the same time, U.S. Attorney General Eric Holder may be right when he suggests that awards capped below annual bonuses may not be enough to encourage confidential reporting by well-placed Wall Street insiders, says Andrew Schilling of BuckleySandler LLP.

  • Liquidity Coverage Ratio Rule: Is Opaqueness Intended?

    Richard D. Jones

    The new liquidity coverage ratio rule doesn’t really clarify some key interpretative issues — such as what’s a sponsor? And what in heaven is an implicit obligation? Why kill the trees necessary to print a 400-page missive and be that obscure? asks Richard Jones of Dechert LLP.

  • Beware CFPB Scrutiny Of Promotional Credit Card Offers

    William M. McSwain

    Companies that run afoul of the Consumer Financial Protection Bureau’s guidelines on promotional offers should expect the same scrutiny that the bureau has applied to descriptions of add-on productions and other credit card practices — which has resulted in a number of high-dollar settlements, say William McSwain and Richard Haggerty of Drinker Biddle & Reath LLP.

  • What Happens To Lenders' Collateral During Bankruptcy?

    Michael J. Venditto

    Lenders and their attorneys are conditioned to believe that being oversecured is as good as life gets for a creditor. But post-closing confidence in a job well done can quickly evaporate if the borrower files a bankruptcy case intending to sell the collateral, say Michael Venditto and Sarah Kam of Reed Smith LLP.

  • The Great Digital Bank Robbery: Are You Ready?

    Daniel Garrie

    At some point, cybercriminals will strike a truly critical blow to American banks. The U.S. does not currently have the legal framework in place to efficiently handle a large-scale financial breakdown, but it is critically important that law firms engage client financial institutions in open dialogue concerning cybersecurity, says Daniel Garrie of Law & Forensics LLC.

  • When Administrative Changes Require Notice And Comment

    Brian A. Bodansky

    Until the U.S. Supreme Court decides Mortgage Bankers Association v. Harris and whether the U.S. Department of Labor needed to allow notice and comment before changing who qualifies for the administrative exemption under the Fair Labor Standards Act, there may be an increase in litigation over the exempt status of mortgage loan officers, says Brian Bodansky of Wigdor LLP.

  • IP Exchange International — The Good, The Bad, The Ugly

    Rodney Miller

    Intellectual Property Exchange International Inc. offers a novel approach for monetizing and licensing a patent portfolio. But with only three offerings available to date, uncertainties remain over its ultimate success in balancing the competing interests of patentees and potential purchasers, say Mitch Stockwell and Rodney Miller of Kilpatrick Townsend & Stockton LLP.

  • Opportunities And Pitfalls In The Legal Cloud

    David Houlihan

    Like "big data" and other effective software marketing buzzwords, “cloud” makes something that is very complex sound simple — and even friendly. Most attorneys are not prepared to dig into the distinctions between public, private and hybrid cloud models, or the niceties of how or where their data is transmitted and stored, says David Houlihan of Blue Hill Research Inc.

  • In 7th Circ., Parties Are Held To The Terms Of A Bargain

    Stephen M. Proctor

    In the recent case of Southern Financial Group LLC v. McFarland State Bank involving a purchase of distressed loans secured by 19 real properties, the Seventh Circuit took advantage of a "straightforward case" to display its freedom of contract philosophy, particularly for sophisticated commercial parties that are expected to know what they are getting into, says Stephen Proctor of Masuda Funai Eifert & Mitchell Ltd.

  • The Emergence Of P2P Loan Securitizations

    John Timperio

    As more peer-to-peer commercial loan securitization transactions take place, the banks, bondholders and rating agencies involved will likely begin to expect more standardization of the loans themselves, as well as metrics for assessing risk on individual loans that are more quantifiable, standard and transparent, say John Timperio and Mary Bear of Dechert LLP.