WAMU Shareholders Get Settllement Based on Bad Loan Practices
Posted on July 3, 2011 by Neil Garfield
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EDITORS COMMENT: Is it me? Or does it seem that everyone — investors, governments, and anybody BIG is getting paid hundreds of millions of dollars or even billions of dollars from all the big players in the securitization (derivative scam) but NOBODY is asking to apply these settlements to the Borrower’s obligation. The figures are wrong in the settlements, wrong in the foreclosures, wrong at the auction, wrong on demands for adequate protection and wrong on supercedeas bond.When is somebody going to ask the the FULL accounting from the investors on down to the borrower and start doing simple arithmetic. These loans are (a) not in default (b) partially or completely paid off by third parties (c) subject to various counterclaims and defenses that would set-off against the principal demanded, (d) not secured (e) discharged in bankruptcy.
Washington Mutual Settles Fraud Suits for $208 Million
By REUTERS
Washington Mutual’s officers, directors, underwriters and auditor have agreed to a $208.5 million settlement to end class-action securities fraud lawsuits, according to court documents.
The settlement is among the largest stemming from the financial crisis, behind a $624 million settlement by the Countrywide Financial Corporation and $475 million by Merrill Lynch & Company.
The lawsuits, in the United States District Court for the Western District of Washington, accused the defendants of concealing from investors poor loan underwriting and inflated appraisals that overstated earnings and inflated the company’s stock price.
As the housing market began to crash, Washington Mutual’s loans soured at an alarming rate. In September 2008, regulators seized the company’s savings and loanbusiness in the largest bank failure in the nation’s history.
The day after the seizure, the bank holding company, Washington Mutual, filed for bankruptcy.
Under the terms of the class-action settlement, announced in court papers dated Thursday, claims against the directors and officers will be settled for about $105 million.
About a dozen underwriters of the company’s securities contributed $85 million to the settlement; the company’s auditor, Deloitte & Touche, contributed $18.5 million.
The settlement is subject to court approval.
Filed under: bubble, CDO, CORRUPTION, currency, Eviction, foreclosure, GTC | Honor, Investor,Mortgage, securities fraud Tagged: | bankruptcy, borrower, countrywide, disclosure,foreclosure, foreclosure defense, foreclosure offense, foreclosures, fraud, LOAN MODIFICATION, modification, quiet title, rescission, RESPA, securitization, TILA audit, trustee,WEISBAND
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One Response
- Simon, on July 3, 2011 at 4:23 am said:Well Neil, I think the main issue is that the homeowner received a lump sum of money, to which they used to purchase or renovate a home. However nefarious means were used for that money to eventually make it’s way to the homeowner seems to be immaterial. But, I hope you are correct in that the homeowner’s obligation has to be affected by these payments in some way. I wonder if any of the cases winding their way through the system are arguing for just such an accounting.
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