And I concur!

William K. Black
February 12, 2016     Bloomington, MN

The Bank Whistleblowers United announce the inaugural Financial Fraud Lemons of the Week award.  There can be no more fitting recipient than the ironically named Department of Justice (DOJ).  The “lemon” is used in the economics and criminology literature to refer to a car of surpassingly terrible quality.  The quality is so bad that the car can only be sold through fraud.  We will award it each week to an example of dishonesty or cowardice about financial fraud that is worthy of public ridicule.  We want to leave room in our scale for truly spectacular examples, so this first award will only receive Four Lemons.  The first award is for what has become a routine example of dishonesty and cowardice by DOJ.  Its conduct should be a scandal of national proportions, but by now everyone expects DOJ to…

The New York Times has taken notice of Bank Whistleblowers United (BWU). You can read it here.

Source: New Economic Perspectives

Dimon bets the farm on the House of Morgan…

Chairman said to buy 500,000 shares to boost confidence in banking industry

J.P. Morgan Chase & Co. Chairman and Chief Executive James Dimon bought 500,000 of his bank’s shares on Thursday, a person familiar with the matter said.

The $26 million purchase is designed to stem the tide of negative sentiment overwhelming bank stocks this year. The big-ticket stock purchase from one of the country’s most well-known bankers followed a 20% decline in J.P. Morgan’s JPM, -4.41% share price so far this year and a broader selloff that has hit big banks such as Citigroup Inc. C, -6.50% and Bank of America Corp. BAC, -6.84% particularly hard.

Bank stocks have fallen about twice as much as broader stock-market averages this year as investors fret over slowing economic growth, falling energy prices and the possibility that interest rates will fall, a tough…

Fannie Mae announced Wednesday that it selected the winning bidders in its latest sale of non-performing loans, with a subsidiary of one of Wall Street’s biggest names among the winning bidders.

The total sale included four pools of loans that total $1.32 billion in unpaid principal balance spread across 6,540 loans.

The winning bidder for two of those pools, representing 2,068 loans that carry an unpaid principal balance of $418,414,683, was MTGLQ Investors, L.P., a “significant subsidiary” of Goldman Sachs.

According to the Securities and Exchange Commission, Goldman Sachs owns, directly or indirectly, at least 99% of the voting securities of MTGLQ Investors, L.P.

Read on.

This is an article back in 2009 where Fannie Mac CFO committed suicide. It makes me wonder what happened to the probe as well Freddie Mac’s accounting practices and why this case remains unsolved and silent:

Police Investigating Death of Freddie Mac Official, Dead Of Apparent Suicide

WASHINGTON (AP) — The chief financial officer of money-losing mortgage giant Freddie Mac was found dead in his basement early Wednesday morning in what police said was an apparent suicide.

David Kellermann, 41, apparently hanged himself, said a law enforcement official familiar with the investigation. He asked not to be identified because the investigation was ongoing.

Kellermann’s death is the latest in a string of blows to Freddie Mac since it was seized by the government last September. The company, which owns or guarantees about 13 million mortgages, has been criticized for financing risky loans that fueled the real estate bubble and are…

Now this is a joke. Freddie Mac is educating consumers on mortgage fraud!

Housingwire:

As part of a continuing series that aims to educate consumers on all aspects of the home buying process, Freddie Mac released a short video that tells consumers how to avoid mortgage fraud when applying for a loan.

In the video, Freddie Mac identifies several “red flags” that consumer should be on the lookout for, including:

• Being told to exaggerate your income, assets, credit, or provide false information someone says will help get the loan approved

• Being pressured to sign paperwork that you haven’t had a chance to read or that you don’t fully understand

• Being asked to release personal financial information online or over the phone by someone you don’t know

Last year, as a part of the same education effort, Freddie Mac issued a warning to buyers and lenders about scams that offer the…

Very interesting…

The Week:

Before Hillary Clinton was railing on big banks in a race for the Democratic presidential nomination against notoriously anti-Wall Street candidate Sen. Bernie Sanders (I-Vt.), she was getting paid by the big banks to give talks. Now, those private talks are threatening to make a second — and very public — appearance as the push grows for Clinton to release transcripts.

While some argue that the remarks are nothing but the “boilerplate, happy talk that highly paid speakers generally offer to their hosts,” others worry that Clinton’s speech, if released, could easily be taken out of context by Sanders, who has already been slamming her for her Wall Street connections.

According to one attendee at Clinton’s October 2013 speech to Goldman Sachs executives and tech industry leaders, Clinton’s remarks then were a far cry from what she’s saying on campaign trail now. “It was pretty glowing…

William K. Black
February 4, 2016     Bloomington, MN

Former Secretary of State Hillary Clinton, in her debate with Senator Sanders minutes ago, said that she went to Wall Street and told them to stop their “shenanigans.”  The context was that she was being asked to respond to the complaint that she was too close to on Wall Street billionaires.  She had every incentive, therefore, to demonstrate how tough she would be on Wall Street.  In that context, the best she could muster was the pusillanimous “shenanigans.”  Here is a typical definition of that word with examples.

1. : a devious trick used especially for an underhand purpose
2. 2a:  tricky or questionable practices or conduct —usually used in pluralb :  high-spirited or mischievous activity —usually used in plural

Examples of shenanigan

1. students engaging in youthful shenaniganson the last day of school
2. an act of vandalism that…

HSBC agreed to a $601 million settlement with a series of federal agencies and nearly every state over charges that the bank engaged in mortgage origination, servicing and foreclosure abuses.

The massive settlement with HSBC was jointly announced Friday by the Department of Justice, the Department of Housing and Urban Development, the Consumer Financial Protection Bureau, 49 states and the District of Columbia.

As part of that settlement, HSBC will pay a total of $470 million in relief to consumers and payments to federal and state parties, and will be bound to mortgage servicing standards and be subject to independent monitoring of its compliance with the agreement, the DOJ said in a statement.

“This agreement is the result of a coordinated effort between federal and state partners to hold HSBC accountable for abusive mortgage practices,” said Acting Associate Attorney General Stuart Delery.

“This agreement provides for $370…