Posted 10 years ago on Nov. 10, 2011, 6:38 p.m. EST by MonetizingDiscontent
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Bank Of America to Settle Mortgage Securities Action for $315 Million
-Dec 6, 2011-
Bank of America Corp. (BAC) reached a $315 million settlement with a group of investors who sued its Merrill Lynch unit claiming they were misled about mortgage- backed securities, according to a court filing.
Holders of the asset-backed certificates sued Merrill Lynch starting in December 2008 for alleged “false and misleading” prospectus statements related to the securities, according to the complaint and a brief filed yesterday in Manhattan... http://topics.bloomberg.com/manhattan/ ...federal court.
The investors said that inaccurate statements were made about qualifications of mortgage-loan borrowers, property appraisals and debt-to-income ratios of applicants, and that “the registration statement materially misrepresented the credit quality of the mortgage loans underlying the certificates.”
The $315 million will be distributed to certificate holders who submit valid claim forms, plaintiffs’ lawyers said in court papers.
Lawrence Grayson, a Bank of America spokesman, said in a phone interview that the company had no comment on the settlement.
(((Continue Reading this article Here))) http://www.bloomberg.com/news/2011-12-06/bofa-to-settle-mortgage-securities-class-action-for-315-million.html
For Bank Of America, Debit Fees Extend To Unemployment Benefits
"...Bank of America recently aborted plans to charge ordinary banking customers $5 a month to use their debit cards in the face of national outrage. But the bank has quietly continued to mine another source of fees: jobless people who depend upon the bank's prepaid debit cards to tap their benefits. Bank of America and other financial firms -- including U.S. Bank, Wells Fargo and JP Morgan Chase -- have secured contracts to provide access to public benefits in 41 states. These contracts typically allow banks to collect unlimited fees from merchants and consumers."
"In short, the same banks whose speculation delivered a financial crisis that has destroyed millions of jobs have figured out how to turn widespread unemployment into a profit center: The larger the number of people who are out of work and dependent upon the state for sustenance, the greater the potential gains through administering their benefits..."
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Bank Of America Derivatives Timebomb Shows System Is Corrupt To The Core
(PBL) The Federal Reserve recently allowed Bank of America to move its massive derivative positions from the bank holding company to its banking subsidiary which is an FDIC insured depository institution. By allowing this transfer, the Federal Reserve has allowed Bank of America to shift the risk of loss on speculative derivative contracts from the non-bank affiliate. A failure of Bank of America could result in huge losses for the FDIC which would ultimately be passed on to the taxpayers.
The most noteworthy aspects of this remarkable event include the following:
(1) The disclosure of the derivatives transfer to Bank of America’s FDIC insured depository was apparently leaked by the FDIC which opposed the move due to the huge amount of risk being transfered to the FDIC and bank depositors.
(2) In allowing the transfer, the Federal Reserve apparently violated Section 23A of the Federal Reserve Act which was supposed to keep the risks of investment banking activities at the bank holding company level.
(3) The notional value of the Bank of America derivative contracts is $75 trillion. The request for the derivatives transfer was initiated by counterparties of the contracts with Bank of America who were alarmed over the credit downgrade of Bank of America.
(4) The transfer of the derivatives from Bank of America’s holding company to the FDIC insured depository institution has received remarkably little mainstream press coverage. The quick approval by regulators at the Federal Reserve to protect the bank holding company indicates that the Federal Reserve is corrupt to the core and more interested in protecting the banks than the American public.
Bill Black, a former banking regulator, who exposed the corruption of banks and politicians during the savings and loan crisis, harshly criticizes the Fed’s actions in his recent article “Bank of America’s Death Rattle“....
Not with a Bang, but a Whimper: Bank of America’s Death Rattle
(By William K. Black ) "...Now here’s the really bad news. First, this transfer is a superb “natural experiment” that tests one of the most important questions central to the health of our financial system. Does the Fed represent and vigorously protect the interests of the people or the systemically dangerous institutions (SDIs) – the largest 20 banks? We have run a real world test."
"The sad fact is that very few Americans will be surprised that the Fed represented the interests of the SDIs even though they were directly contrary to the interests of the nation. The Fed’s constant demands for (and celebration of) “independence” from democratic government, combined with slavish dependence on and service to the CEOs of the SDIs has gone beyond scandal to the point of farce. I suggest organized “laugh ins” whenever Fed spokespersons prate about their “independence.”
(PBL) ...If regulators were doing their jobs properly, banks would not be allowed to engage in massive speculation through derivatives trading. The near meltdown of the financial system in 2008 has resulted in thousands of pages of new regulations but has done nothing to reign in “too big to fail banks” or reduce systemic risk in the financial system.
~ S o m e B a c k g r o u n d ~