Friday, February 21, 2014



Updated 2-5-2014 from 12-27-2013
(has been running since April 24, 2013)
                                  It Wasn’t the Home Buyers! 
So that my followers do not have to start at the beginning...again... to read through the massive lawsuits and settlements outlining Mortgage fraud...I have moved the most current ones for 2014 to the front - however, if you should desire to review all the other ones I have, once again...I have left them intact below.  THIS LIST IS BY NO MEANS EXHAUSTIVE - THERE ARE OTHER SETTLEMENTS OUT THERE I HAVE NOT INCLUDED!
Following is a list of settlements that not only acknowledge illegal behavior, but serve as evidence that the home-buyers were not the perpetrators of this fraud:   
4/12/2013 by  Barry Fagan

Servicers and corrupt foreclosure law firms should not get a free house. The automated and robotic foreclosure processes that have been engineered over the last two-decades must be re-engineered to stop the frauds and abuses that have permeated our legal system. Far too many major banks and servicers are getting a free pass to unjustly take away a borrower’s property and getting a free house in the process. The blame for this crisis lies squarely on the heels of the mortgage industry and its lawyers. These frauds were systemic and endemic, not isolated mistakes and errors. As you will see in this paper, the CEOs and boards of major banks and mortgage companies like Fannie Mae and Freddie Mac were fully aware of the frauds, but chose to turn a willful blind-eye to the abuse and its ultimate consequences.[1]

Special honorary mention for closing out 2013 with a BANG! and settlement......
A $2.2 billion agreement is settling accusations against a large but little known player in the mortgage industry that escaped last year’s sweeping mortgage settlement. The Ocwen Financial Corporation, which has ridden its specialty in servicing subprime loans to become the fourth-largest mortgage servicer in the country, was accused of improperly handling the loans of homeowners after the financial crisis. The agreement with the Consumer Financial Protection Bureau and 49 states covers similar ground to a $25 billion settlement made last year with the largest banks. Ocwen was not included in the larger settlement because its nonbank status allowed it to slip through the cracks of the different regulatory agencies. The company, which is publicly traded, now falls under the oversight of the bureau, which began in 2011.[1]

 January 9, 2014 - Wall Street Predicts $50 Billion Bill to Settle U.S. Mortgage Suits 
Wall Street could pay nearly $50 billion to buy peace from federal authorities who are taking aim at the banks over their role in the mortgage crisis, according to interviews and a confidential analysis of the industry’s potential legal exposure. Bracing for a potential reckoning, the banks and their outside lawyers are quietly using JPMorgan Chase’s record $13 billion mortgage settlement in November to do the math and determine just how much each bank might have to pay to move beyond the torrent of government mortgage litigation that has dogged them since the financial crisis. Such calculations, people briefed on the matter said, have gained particular urgency among the banks’ board members. If the settlements materialize, they could yield, according to the analysis, $15 billion in relief for consumers — a mixture of cash payments and other assistance, like reductions in the size of homeowners’ loan payments. A payment of $50 billion, made up of a string of separate deals, would amount to roughly half the total annual profit of large American banks in 2012. The $50 billion figure does not include JPMorgan’s $13 billion payout, which means the ultimate industry tab could exceed $60 billion, according to the analysis.[1]

 NEW YORK, Jan 2
(Reuters) - Deutsche Bank AG has settled a U.S. lawsuit in which shareholders accused it of misrepresenting its ability to handle risks associated with mortgage debt prior to the 2008 financial crisis. The settlement in principle was disclosed in a filing on Thursday by Deutsche Bank's lawyers in the U.S. District Court in Manhattan. Terms were not disclosed, and final paperwork is expected within 30 days, the filing said. Shareholders accused Deutsche Bank of misleading them about its risk management and the underwriting on mortgage debt it packaged and sold, as well as being too slow to take write-downs.[1]

WASHINGTON (Reuters) - Citigroup Inc. (C.N: QuoteProfileResearchStock Buzz) paid $250 million to taxpayer-owned Fannie Mae (FNMA.OB: QuoteProfileResearchStock Buzz) and Freddie Mac (FMCC.OB: QuoteProfileResearchStock Buzz) to settle a lawsuit over soured mortgage securities, the regulator of the two housing finance firms said on Thursday.[1]

By Karen Freifeld
NEW YORK (Reuters) - A New York state judge on Friday approved Bank of America Corp's (BAC.N: QuoteProfileResearch,Stock Buzz) $8.5 billion settlement with investors in mortgage securities, which would resolve much of the bank's liability from its acquisition of Countrywide Financial Corp during the financial crisis. Justice Barbara Kapnick ruled that Bank of New York Mellon (BK.N: QuoteProfileResearchStock Buzz), the trustee overseeing the securities, had mostly acted reasonably and in good faith in determining that the settlement was in the best interests of the investors. Countrywide, based in Calabasas, California, was the biggest home mortgage lender in the United States until the housing market collapsed, specializing in so-called subprime loans, most of which it packaged into securities and resold to investors. It was bought by Bank of America in 2008.[1]

David Ingram and David Henry 

WASHINGTON (Reuters) - JPMorgan Chase & Co settled the latest in a string of legal claims on Tuesday when it agreed to pay $614 million to the U.S. government and admitted that it defrauded federal agencies by underwriting sub-standard mortgage loans.   JPMorgan is one of several banks that has faced similar allegations. Citigroup Inc and Deutsche Bank AG have also reached settlements, while the Justice Department is seeking $2.1 billion in penalties from Bank of America Corp after a jury found the bank liable for fraud over mortgages sold by its Countrywide unit.[1]

 Morgan Stanley has agreed to pay $1.25 billion to the Federal Housing Finance Agency to resolve claims that it sold shoddy mortgage securities to Fannie Mae and Freddie Mac. In a securities filing late Tuesday, Morgan Stanley said that it had reached an agreement “in principle” with the agency, which is the federal conservator for the mortgage finance giants Fannie and Freddie. The settlement is the latest agreement between a Wall Street firm and the F.H.F.A., which in 2011 sued 18 financial institutions seeking relief for some of the big losses suffered by the taxpayer-supported entities. According to the agency’s lawsuit, Morgan Stanley sold $10.58 billion in mortgage-backed securities to Fannie and Freddie during the credit boom, while presenting “a false picture” of the riskiness of the loans. The housing finance agency said the underwriting of the mortgage loans did not meet the standards detailed to Fannie and Freddie. The lawsuit involved mortgage-backed securities issued from Sept. 12, 2005, to Sept. 27, 2007. Many of the loans involved were originated by subprime lenders, like New Century and IndyMac, bundled into bonds and sold to Fannie and Freddie. One group of loans had default and delinquency rates as high as 70 percent, according to the lawsuit.[1]

Well, that should be it for today's listing.....
After all, it's only............ FEBRUARY!
Who knows how many more I might have to add before the end of the year.  
10/6/2008 – $8.68 billion dollar settlement with Countrywide for the State of California[1] – relief for home-buyers  - ?

8/3/2010 - $600 million dollar settlement with Countrywide Financial with the New York City Pension Funds[2] – relief for homebuyers – 0

10/15/2010 - $67.5 million settlement with the SEC[3] – relief for homebuyers – 0

[1] State of California – Press Release
[2] GMI Blog – settlement with NY City Pensions Fund
[3] Christian Science Monitor – Mozillo settles.. 
 2/2/2011 – Former Countrywide executives make a $6.5 million settlement with California[1] - relief for homebuyers – 0
6/29/2011 – B of A settles with 22 institutional investors for 14 billion.[2] – relief for homebuyers – 0
7/20/2011 – Countrywide settles a class action suit for charging excessive fees to more than 450,000 borrowers. – relief for homebuyers - ?
12/21/2011 – Countrywide settles bias suit for $335 million dollars for discrimination[3] – relief for homebuyers – ?

2/2012 – $25 Billion dollar 48 state settlement with 5 major lenders. – relief for homebuyers yet to be determined, but they are still losing their homes.[4]        

          From the article in Huffington Post, 4/23/2013[5]
“In February of last year, five large banks, including Bank of America, agreed to a $25 billion settlement with 49 state attorneys general and federal authorities to resolve broad-based and persistent claims that they mishandled home loans in crisis. The banks were accused of charging improper fees while dispatching homeowners on customer service misadventures that often terminated in foreclosure. On Thursday, Bank of America and other mortgage companies -- 13 in all, this time -- finalized a separate $9.3 billion settlement with federal bank regulators to resolve similar claims.

The settlements also required the mortgage industry to revize loan "servicing" practices -- how it manages homeowner accounts --widely seen as unfair and damaging. The deadline to make those reforms was Oct. 1. Banks may face fines of up to $1 million for each violation.

Berry (a borrower) will receive nothing under these high-profile legal deals, even though she claims the same types of abuse that the settlements were meant to resolve. She is not alone, consumer advocates say. While these agreements have led to an uptick in aid for some borrowers, for many others, the deals might as well have happened on a different planet.”
[1] California settles with Countrywide execs.
[2] B of A announces $14 billion settlement of Countrywide Mortgage Claims.  ( [3] Countrywide will settle bias suit. (
[4] $25 Billion Mortgage Settlement "Just the 'First Step' - ABC News
[5] Mortgage Settlement Relief Fails To Reach Millions Of Foreclosed Homeowners 
11/2012 - JP Morgan and Credit Suisse Settle With SEC For $417 Million[1]  Relief for homebuyers who were victims of this fraud?  - 0

1/2013 - HSBC To Pay $249 Million In Foreclosure Settlement[2]
WASHINGTON (AP) — British bank HSBC will pay $249 million to settle federal complaints that its U.S. division wrongfully foreclosed on homeowners who should have been allowed to stay in their homes. The agreement with the Federal Reserve and the Office of the Comptroller of the Currency is similar to deals with 12 other banks that ended a review of loan files required under a 2011 federal action. Combined, the 13 banks will pay $9.3 billion.”
2/2013 - $8.5 Billion dollar settlement for wrongful foreclosures.[3]  Relief for homebuyers for losing their homes?  $300 - $2000 dollars.  (I have yet to hear of anyone getting $125,000 as noted in settlement).       
3/2013 – LA Times reported that they found 1600 pages of undisclosed settlements filed with the FDIC against major banks![4]Relief for homebuyers? - 0

[1] JP Morgan and Credit Suisse Settle With SEC For $417 Million -
[3] REAL ESTATE: $8.5 billion deal reached on wrongful foreclosures | Business | - Press-Enterprise
[4] In major policy shift, scores of FDIC settlements go unannounced - Los Angeles Times 4/23 
 “The evidence uncovered in the Household suit should put to lie once and for all the oft-repeated myth – spread by many of America's most notable dumb people, from Rush Limbaugh to New York City Mayor-unelect Mike Bloomberg – that the financial crisis was caused by the government "forcing" banks to lend to poor people. In reality, of course, the subprime bubble exploded because financial companies and banks were in a mad rush to get as many iffy borrowers into loans as quickly as possible – and not because they were forced to, but because they made assloads of money doing so.”[1]

With all the settlements and court cases regarding bank fraud still pending, the lenders are still allowed to foreclose and remove families from their homes.  This is making countless families homeless and destroying the moral of millions of American citizens.          

Yet the evidence tells us that these families have been lured into liar loans and later into default:   A)   The FBI estimates that 80 percent of all mortgage fraud involves collaboration or collusion by industry insiders.[1]
B)   Register of Deeds, John O’Brian has documented massive fraud.[2]
C)   San Francisco study found 85% error in foreclosures[3]
D)   Movies:  Too Big Too Fail, Insider Trading, Margin Call, and most recently, We Are Not Broke            So for homebuyers the question is…why are we still paying for the fraud?  And why are we the ones being labeled the “deadbeats” while the Executives that created this fiasco are getting bailed-out and they are getting huge bonuses in addition?

[1] Back up of article on FBI study  (
[2] Back up of Registrar of Deeds fraud findings  (
[3] foreclosure fraud error article.  ( Page) 
In addition, the lawsuits have not ceased…

February 2013 – U.S sues the S & P for ratings fraud related to Mortgage-Backed Securities (MBS).[1] 

“The U.S. government is seeking $5 billion in its civil lawsuit against Standard & Poor’s, accusing the ratings service of defrauding investors, in one of the most ambitious cases yet from the Justice Department over conduct tied to the financial crisis. The United States said S&P inflated ratings and understated risks associated with mortgage securities, driven by a desire to gain more business from the investment banks that issued those securities. S&P also falsely claimed its ratings were objective, the lawsuit said.”

April 2013 - AIG is suing B of A for mortgage fraud:[2] 

“(Reuters) - American International Group Inc (AIG.N) won a legal victory over where a mortgage fraud lawsuit it brought against Bank of America Corp (BAC.N) should be heard, a two-year-old case that has largely been on hold because of the dispute over venue. The 2nd U.S. Circuit Court of Appeals on Friday agreed with AIG that the case belongs in state court, not federal court as Bank of America preferred.”

April 2013 – Prudential Insurance sues Goldman Sachs for Mortgage Fraud and Racketeering on MBS[1] :

“Goldman fails to dismiss Prudential mortgage fraud lawsuit * Prudential alleged losses on more then $375 mln RMBS * Fraud, racketeering claims allowed to proceed * Goldman, Prudential decline to comment By Jonathan Stempel April 9 (Reuters) -Goldman Sachs Group Inc must face a lawsuit in which Prudential Financial Inc accused the Wall Street bank of defrauding it into buying more than $375 million of residential mortgage-backed securities it knew were unsafe.”

April 2013 - Foreclosure Review Finds Potentially Widespread Errors[2]

“BOSTON -- Nearly a third of all foreclosed borrowers who faced proceedings brought by the biggest U.S. mortgage companies during the height of the housing crisis came to the brink of losing their homes due to potential bank errors or under now-banned practices, regulators have revealed. Close to 1.2 million borrowers, or about 30 percent of the more than 3.9 million households whose properties were foreclosed on by 11 leading financial institutions in 2009 and 2010, had to battle potentially wrongful efforts to seize their homes despite not having defaulted on their loans, being protected under a host of federal laws, or having been in good standing under bank-approved plans to either restructure their mortgages or temporarily delay required payments.”  

                                                    1600 PAGES?!? 

In major policy shift, scores of FDIC settlements go unannounced Since the mortgage meltdown, the FDIC has opted to settle cases while helping banks avoid bad press, rather than trumpeting punitive actions as a deterrent to others.   Under the Freedom of Information Act, The Times obtained more than 1,600 pages of FDIC settlements, made from 2007 through this year with former bank insiders and others accused of wrongdoing. The agreements constitute a catalog of fraud and negligence: reckless loans to homeowners and builders; falsified documents; inflated appraisals; lender refusals to buy back bad loans. Defendants benefit by settling because they can avoid admitting guilt and limit the damages they might face in court. The FDIC benefits by collecting money without the hassle and expense of litigation. The no-press-release arrangements help close those deals

June 2013 - Bank of America’s mortgage servicing unit systematically lied to homeowners, fraudulently denied loan modifications, and   paid their staff bonuses for deliberately pushing people into foreclosure: Yes, these allegations were suspected by any homeowner who ever had to deal with the bank to try to get a loan modification –

but now they come from six former employees and one contractor, whose sworn statements were added last week to a civil lawsuit filed in federal court in Massachusetts. “Bank of America’s practice is to string homeowners along with no apparent intention of providing the permanent loan modifications it promises,” said Erika Brown, one of the former employees. The damning evidence would spur a series of criminal investigations of BofA executives, if we still had a rule of law in this country for Wall Street banks.[1]

                                                       MORE UPDATES!
August 2013 – Mortgage System Still Victimizing Homeowners, Watchdog Finds   Posted: 08/21/2013 3:55 pm EDT  |  Updated: 08/22/2013 11:27 am EDT The Consumer Financial Protection Bureau on Wednesday issued a report detailing a host of failures in basic mortgage payment processing at U.S. financial institutions. While the report does not specifically name any companies, the agency's oversight authority includes all of the largest mortgage companies in the country, as well as smaller specialty operators.[1]   
September 2013 - Citigroup to Pay $395 Million to Settle Freddie Mac Claims By THE ASSOCIATED PRESS   WASHINGTON — Citigroup has agreed to pay $395 million to the government-controlled mortgage finance company Freddie Mac to settle claims on home loans it had sold to it. The agreement, announced on Wednesday, involves 3.7 million mortgages that were sold from 2000 to 2012.[2]


September 2013 - JPMorgan Seeking Mortgage Probe Deal With Multiple Agencies: Report Reuters  |  Posted: 09/25/2013 8:11 am EDT NEW YORK (Reuters) - JPMorgan Chase & Co, facing several investigations into its mortgage practices, is seeking a global settlement with U.S. government authorities in multiple jurisdictions, a person familiar with the matter said on Tuesday. Negotiations have resumed with the U.S. Department of Justice after federal prosecutors in California delayed a plan to file a lawsuit there on Tuesday. The global settlement would cover probes of JPMorgan's mortgage business, as well as investigations of similar operations it inherited from other banks during the financial crisis. The investigations include civil and criminal authorities from the DOJ. The California case involved the sale of bonds backed by subprime mortgages and other risky home loans between 2005 and 2007. The California negotiations initially broke down over the amount the bank would pay as a penalty, sources said.[1] 

October 2013 - (Reuters) - Wells Fargo & Co said on Monday it will pay $780 million in cash to Freddie Mac to resolve substantially all repurchase liabilities on home loans sold to the government-controlled mortgage company prior to 2009. The largest U.S. mortgage lender said the settlement was reached on September 27 and totaled $869 million before adjusting for credits related to prior loan repurchases.[2]

                                                DO THE HUSTLE!!!! 
                                       October 2013: THE WALL STREET JOURNAL                                    October 3, 2013, 10:00 AM ET The ‘Hustle’ Cast ByShayndi Raice

The “hustle” program at Countrywide that is now at the center of a trial has a robust cast of characters with a lot at stake. The “High Speed Swim Lane” program created by Countrywide in August 2007 first came to light when a former employee turned into a whistleblower, telling the government that the program sacrificed quality for speed in an effort to churn out loans for sale to mortgage finance firms Fannie Mae and Freddie Mac. The U.S. Attorney for the Southern District of New York has since brought a lawsuit alleging fraud by the bank and a former Countrywide executive who ran the program. Throw in some high-profile attorneys and one blunt judge, and you’ve got a colorful cast with a lot at stake.[1] 

Yesterday’s jury finding in a Manhattan court that a bank and a bank executive are liable for fraud is a true watershed. This is something that hasn’t happened since investigations and settlements over what led to the financial crisis have been coming and going. In a civil suit, Preet Bharara, the U.S. attorney for the Southern District of New York, scored a massive victory over Bank of America and one of its former executives. The defendants, instead of settling, were found guilty of fraud by a jury of four men and six women.

December 5, 2013 – Los Angeles 
December 5, 2013 – Los Angeles   The city of Los Angeles accused banking giants Wells Fargo & Co. and Citigroup Inc. of a “continuous pattern and practice” of mortgage discrimination that led to a wave of foreclosures, reduced property tax revenue and increased costs for city services.[1]

December 8, 2013 Los Angeles  
December 8, 2013 – Los Angeles   LOS ANGELES -- The Los Angeles city attorney is suing Bank of America for mortgage discrimination it claims led to a wave of foreclosures that cost the city a fortune in extra expenses and lost taxes. The suit, filed Friday in federal court, claims B of A redlined minority neighborhoods for years, then turned around and gave blacks and Hispanics predatory home loans that they couldn't afford. The suit claims those borrowers were forced into foreclosure when the housing bubble burst and they were denied refinancing.[2]

December 2, 2013 - (Reuters) - Bank of America Corp will pay $404 million to Freddie Mac to resolve all repurchase liabilities on home loans sold to the government-controlled mortgage company from 2000 to 2009, the bank said on Monday. The settlement covers about 716,000 loans and compensates Freddie Mac for past losses and potential future losses related to denials, rescissions and cancellations of mortgage insurance, Freddie Mac said in a statement. Bank of America will pay a net $391 million, reflecting a $13 million credit for prior repurchases and adjustments, Freddie Mac said. Since 2010, Bank of America has agreed to pay more than $45 billion to settle various claims stemming from the U.S. housing and financial crisis.[1]

December 6, 2013 - PNC Financial Services Group Inc will pay Freddie Mac $89 million to resolve all repurchase liabilities on home loans sold to the government-backed housing agency through the end of 2008. The settlement will compensate for past losses and any potential future losses on 900,000 loans sold to Freddie Mac between 2000 and 2008, PNC said in a statement. Most of the loans covered under the settlement stem from National City, which PNC bought for $5.2 billion during the financial crisis in 2008. PNC joins other U.S. banks that have settled with Freddie Mac and Fannie Mae, another government-controlled mortgage company, with regard to the troubled companies they acquired during the financial crisis. Earlier this week, Bank of America said it settled with Freddie Mac on all claims arising from residential mortgages sold to the agency through the end of 2009.[1]

December 10, 2013 – (This is for my friend MM) - U.S. Bancorp on Tuesday announced a $53 million settlement with Freddie Mac, making it the third major bank this month to close mortgage repurchase claims with the government-controlled firm.
The settlement resolves substantially all repurchase obligations related to representations and warranties made on loans sold to the Federal Home Loan Mortgage Corp. between 2000 and 2008, the parent company of U.S. Bancorp said in a statement.

After adjusting for credits related to prior repurchases, U.S. Bancorp will make a one-time $53 million cash payment to Freddie Mac. The bank said it had set aside the money for the agreement in September.

A representative for U.S. Bancorp could not immediately be reached Tuesday for additional information regarding Freddie Mac’s claims.[1]
December 20, 2013 - MCLEAN, VA--(Marketwired - Dec 20, 2013) - Freddie Mac (OTCQB: FMCC) today announced that it, in conjunction with Fannie Mae and FHFA, has entered into an agreement with Deutsche Bank Securities, Inc. and certain affiliated entities (collectively, "Deutsche Bank") to settle claims related to investments by Freddie Mac and Fannie Mae in certain residential non-agency mortgage-related securities. The agreement will settle litigation previously initiated by FHFA against Deutsche Bank and also certain repurchase obligations with respect to the loans in these securities. Deutsche Bank will make a total payment of $1.925 billion, of which approximately $1.628 billion is expected to be paid to Freddie Mac and will be reflected in the company's fourth quarter results. [1]

December 27, 2013 - Dec 27 (Reuters) - An arbitration panel has ordered Wells Fargo & Co's brokerage unit to buy back about $94 million of auction-rate securities from investors.

The San Francisco-based bank's brokerage unit was ordered to pay at par value to investors including James Cohen and a family trust for the securities, the Financial Industry Regulatory Authority arbitration panel said in an award dated Dec. 24.[1]

  AND COMING UP IN 2014…… 
December 4, 2013 - (Reuters) - The U.S. Justice Department plans to bring mortgage fraud cases against several financial institutions early in 2014, using as a template the case that ended last month in JPMorgan Chase & Co's $13 billion settlement, U.S. Attorney General Eric Holder said on Wednesday. In an interview with Reuters, Holder would not say which companies or how many could face lawsuits but said the Justice Department was in contact with them and it was hard to say whether the talks would lead to settlements.[1]

Well, I better stop, once again, for now.  This list is moving up to 9 printed pages and the list is not nearly exhaustive (considering the 1600 pages filed with the FDIC).

So the next time someone tells you that it is the fault of the “deadbeat homebuyers”, just copy and paste this list…you have my permission. 


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