Forum Post: In respect of Seven Years of Auditing -JPMorgan- Securities, Accounting Giant PricewaterhouseCoopers is expected to be Fined up to £1Million /// Penalty is Expected to be Announced in the New Year.
Posted 13 years ago on Nov. 16, 2011, 7:18 p.m. EST by MonetizingDiscontent
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Accounting giant PricewaterhouseCoopers is expected to be fined up to £1m in respect of seven years of auditing JP Morgan Securities.
-December 24, 2011-
PricewaterhouseCoopers faces up to £1m fine over JP Morgan Securities’ audits
-December 24, 2011-
The Accounting and Actuarial Disciplinary Board, a subcommittee of the Financial Reporting Council (FRC), is expected to announce the penalty in the New Year.
Sources close to the case claim the fine will be between £500,000 and £1m, which is around 2pc of the £34m initially envisaged by some.
The Financial Services Authority slapped a £33.2m penalty on JP Morgan Securities Limited (JPMSL) last year for not properly separating client money from the firm's accounts.
An average of £5.5bn wasn't fully segregated in an error that went undetected by auditor PwC between 2002 and 2008.
At the auditor's hearing last month the AADB claimed it was seeking fines that top the £1.2m sanction against Coopers & Lybrand in 1999.
Institutional Bondholders Issue Instructions to Five Trustees to Open Investigations of Ineligible Mortgages in Over $95 Billion of JPMorgan-Issued RMBS
-Dec. 16, 2011-
HOUSTON, Dec. 16, 2011 /PRNewswire/ -- Gibbs & Bruns LLP announced today that its clients have issued instructions to BNY Mellon, US Bank, Wells Fargo, Citibank, and HSBC, as Trustees, to open investigations of ineligible mortgages in pools securing over $95 billion of Residential Mortgage Backed Securities (RMBS) issued by various affiliates of JPMorgan. Collectively, Gibbs & Bruns' clients hold over 25% of the Voting Rights in 243 Trusts that issued these RMBS.
"Our clients continue to seek a comprehensive solution to the problems of ineligible mortgages in RMBS pools and deficient servicing of those loans. Today's action is another step toward achieving that goal," said Kathy D. Patrick of Gibbs & Bruns LLP, lead counsel for the Holders.
The Holders anticipate that they may provide additional instructions to Trustees, as needed, to further the investigations. The securities that are the subject of these instruction letters include:
(((Continue Reading at above link)))
JPM To Be Investigated for Dodgy RMBS, First Exposed on Keiser Report!
-December 16, 2011-
Thanks to the good work of Teri Buhl for this one: http://www.teribuhl.com/
(((Video))) http://maxkeiser.com/2011/12/16/jpm-keiser-report/
To Watch Max Keiser & Teri Buhl as they Broke this story way back in August, Start watching at about 16 minutes & 20 seconds into this video. Provides great background information for this case.
JPMorgan, Goldman Keep Investors in Dark on European Debt Risk;
Net Position Disclosure Hides True Risk
http://globaleconomicanalysis.blogspot.com/2011/11/jpmorgan-goldman-keep-investors-in-dark.html
-November 16, 2011-
(MISH) Banks keep investors in the dark on trillions of dollars of derivatives risk by only reporting net exposure.
Here is a net exposure example to show what I mean. Suppose I owe my sister Sue $250,000 and Uncle Ernie owes me $250,000. My net position would appear to be zero.
But what if uncle Ernie is bankrupt or simply will never pay the loan back for any reason. I cannot tell Sister Sue, "I am not paying you back, collect from Uncle Ernie".
Net position reporting only works if counterparty risk is zero. In my example counterparty risk from uncle Ernie is 100%. So what is the counterparty risk at JP Morgan, Bank of America, Citigroup, and Goldman Sachs on tens of trillions of derivatives contracts?
The answer is no one can possibly figure it out, on purpose, because banks are only required to disclose "net" exposure.
Continue reading the rest of this article at:
http://globaleconomicanalysis.blogspot.com/2011/11/jpmorgan-goldman-keep-investors-in-dark.html
::::::::::::::::Investors Scrutinizing JPMorgan’s Mortgages::::::::::::::::
http://www.cnbc.com/id/45707648
-Dec 17th, 2011-
Bank of America, the firm perhaps hardest hit by mortgage-related lawsuit woes, might have some company in the courthouse soon. Lawyers representing investors that settled billions of dollars of mortgage bond claims with Bank of America last summer announced on Friday that they had opened investigations into $95 billion worth of mortgages held in JPMorgan Chase securities...
::::::::JPMorgan Joins Goldman Keeping Italy Derivatives Risk in Dark::::::::
http://www.bloomberg.com/news/2011-11-16/jpmorgan-joins-goldman-keeping-investors-in-dark-on-italy-derivatives-risk.html
-Nov 15, 2011-
JPMorgan Chase & Co. (JPM) http://www.bloomberg.com/apps/quote?ticker=JPM:US ...and Goldman Sachs Group Inc. (GS), http://www.bloomberg.com/apps/quote?ticker=GS:US ...among the world’s biggest traders of credit derivatives, disclosed to shareholders that they have sold protection on more than $5 trillion of debt globally.
Just don’t ask them how much of that was issued by Greece, Italy, Ireland, Portugal and Spain, known as the GIIPS.
As concerns mount that those countries may not be creditworthy, investors are being kept in the dark about how much risk U.S. banks face from a default. Firms including Goldman Sachs and JPMorgan don’t provide a full picture of potential losses and gains in such a scenario, giving only net numbers or excluding some derivatives altogether....
::::Continued Here::::
http://www.bloomberg.com/news/2011-11-16/jpmorgan-joins-goldman-keeping-investors-in-dark-on-italy-derivatives-risk.html
let them fail
yep. They're too Big to Save.
::::::::::::::::Extend and Pretend is Wall Street's Friend::::::::::::::::
http://www.financialsense.com/contributors/james-quinn/extend-and-pretend-is-wall-street-friend?sms_ss=facebook&at_xt=4d9522e093452eab,0
(By James Quinn) “We now have an economy in which five banks control over 50 percent of the entire banking industry, four or five corporations own most of the mainstream media, and the top one percent of families hold a greater share of the nation’s wealth than any time since 1930. This sort of concentration of wealth and power is a classic setup for the failure of a democratic republic and the stifling of organic economic growth.” - Jesse – http://jessescrossroadscafe.blogspot.com/
====When You’re Losing, Change the Rules====
Wall Street banks had absolutely no problem with mark to market rules from 2000 through 2007, as the value of all their investments soared. These banks created products (subprime, no-doc, Alt-A mortgages) whose sole purpose was to encourage fraud. Their MBA geniuses created models that showed that if you packaged enough fraudulent loans together and paid Moody’s or S&P a big enough bribe, they magically became AAA products that could be sold to pension plans, municipalities, and insurance companies. These magnets of high finance were so consumed with greed they believed their own lies and loaded their balance sheets with the very toxic derivatives they were peddling to the clueless Europeans. They didn’t follow a basic rule. Don’t crap where you sleep. When the world came to its senses and realized that home prices weren’t really worth twice as much as they were in 2000, investment houses began to collapse like a house of cards. The AAA paper behind the plunging real estate wasn’t worth spit. After Lehman Brothers collapsed and AIG’s bets came up craps for the American people, the financial system rightly froze up.
After using fear and misinformation to ram through a $700 billion payoff to Goldman Sachs and their fellow Wall Street co-conspirators through Congress, it was time begin the game of extend and pretend. Market prices for the “assets” on the Wall Street banks’ books were only worth 30% of their original value. Obscuring the truth was now an absolute necessity for Wall Street. The Financial Accounting Standards Board already allowed banks to use models to value assets which did not have market data to base a valuation upon. The Federal Reserve and Treasury “convinced” the limp wristed accountants at the FASB to fold like a cheap suit. The FASB changed the rules so that when the market prices were not orderly, or where the bank was forced to sell the asset for regulatory purposes, or where the seller was close to bankruptcy, the bank could ignore the market price and make up one of its own. Essentially the banking syndicate got to have it both ways. It drew all the benefits of mark to market pricing when the markets were heading higher, and it was able to abandon mark to market pricing when markets went in the toilet.
“Suspending mark-to-market accounting, in essence, suspends reality.” – Beth Brooke, global vice chair, at Ernst & Young
====Let’s Play Hide the Losses====
Part two of the master cover-up plan has been the extending of commercial real estate loans and pretending that they will eventually be repaid. In late 2009 it was clear to the Federal Reserve and the Treasury that the $1.2 trillion in commercial loans maturing between 2010 and 2013 would cause thousands of bank failures if the existing regulations were enforced. The Treasury stepped to the plate first. New rules at the IRS weren’t directly related to banking, but allowed commercial loans that were part of investment pools known as Real Estate Mortgage Investment Conduits, or REMICs, to be refinanced without triggering tax penalties for investors.
The Federal Reserve, which is tasked with making sure banks loans are properly valued, instructed banks throughout the country to “extend and pretend” or “amend and pretend,” in which the bank gives a borrower more time to repay a loan. Banks were “encouraged” to modify loans to help cash strapped borrowers. The hope was that by amending the terms to enable the borrower to avoid a refinancing that would have been impossible, the lender would ultimately be able to collect the balance due on the loan. Ben and his boys also pushed banks to do “troubled debt restructurings.” Such restructurings involved modifying an existing loan by changing the terms or breaking the loan into pieces. Bank, thrift and credit-union regulators very quietly gave lenders flexibility in how they classified distressed commercial mortgages. Banks were able to slice distressed loans into performing and non-performing loans, and institutions were able to magically reduce the total reserves set aside for non-performing loans....
::::::::::::Continue Reading This Article at:::::::::::
http://www.financialsense.com/contributors/james-quinn/extend-and-pretend-is-wall-street-friend?sms_ss=facebook&at_xt=4d9522e093452eab,0
:::::::::::(Video) Keiser explains how Laws are RE-WRITTEN to Allow Mass Financial Fraud:::::::::::
http://www.youtube.com/watch?v=sSgiPryHIE4&feature=player_embedded
White-collar criminologist, former financial regulator
::::::::BILL BLACK: U.S. Using "Really Stupid Strategy" to Hide Bank Losses::::::::
http://finance.yahoo.com/tech-ticker/bill-black-u.s.-using-%22really-stupid-strategy%22-to-hide-bank-losses-535317.html?tickers=%5En225,xlf,bac,%5Edji,c,%5Egspc,faz
The situation is likely even worse than the FDIC portrays, says William Black Associate Professor of Economics and Law at the University of Missouri-Kansas City.
“The FDIC is sitting there knowing that it has both the residential disaster and the commercial real estate disaster [and] knowing it doesn’t have remotely enough funds to pay for it,” he says.
What the FDIC should really be doing, Black argues, is raise its assessments to better reflect the true state of the banking system. However, that would turn an already precarious position into crisis as it would cause more banks would fail. The other option, though not politically plausible, would be to ask the Treasury Department or Congress for more funds.
Therefore, we’re left in our current situation. “That also means we’re following a Japanese type strategy of hiding the losses,” he says. “This is a really stupid strategy and it’s ours.”
It’s also not a money-making strategy for stock investors. Black reminds us Japan’s Nikkei is still worth about 75% less than it was before their bubble burst in late 1989.
::::::::::::Bill Black @ #occupywallstreet Discussing Arresting Banksters::::::::::::
http://www.youtube.com/watch?v=4XJe7O-3QBc&feature=player_embedded