mortgage backed securities

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Goldman Sachs Will Pay $5B Over Sketchy Mortgages

Time to pay the piper for the crash

(Newser) - The Justice Department announced a $5 billion settlement with Goldman Sachs over the sale of mortgage-backed securities leading up to the 2008 financial crisis, reports the AP . The deal announced Monday resolves state and federal probes into the sale of shoddy mortgages before the housing bubble and economic meltdown; Reuters... More »

BofA, Feds Near Biggest Settlement in US History

Justice Dept. deal would cost bank $16B-$17B for foreclosure mess

(Newser) - Bank of America is headed toward the biggest settlement to arise from the 2008 financial crash, a deal with the Justice Department reportedly worth $16 billion to $17 billion over its role in the sale of mortgage-backed securities, a source directly familiar with the matter tells the AP . The tentative... More »

Wall Street's Latest Gambit Might Re-Wreck the Economy

Salon's David Dayen: Massive home-rental scheme is dangerous

(Newser) - Remember the phrase "mortgage-backed securities" and stories about how they helped send the economy into a tailspin? Well, Wall Street has a new and not-so-improved version, this time involving rental homes, writes David Dayen at Salon . Private equity firms such as Blackstone have been buying as many single-family homes... More »

JPMorgan, DoJ Strike 'Tentative' $13B Deal

Doesn't exempt bank from criminal prosecution

(Newser) - JPMorgan Chase has reached a tentative $13 billion deal with the Department of Justice to settle its various civil investigations into the bank's mortgage-backed securities business, a sources tells the Wall Street Journal (and Reuters and Politico ; apparently this meeting was leakier than a rowboat made of Swiss cheese).... More »

SEC: Giving Up on Financial Crisis Prosecutions?

Commission passes on prosecuting major hedge fund

(Newser) - You might want to stop holding your breath waiting for the SEC to bring the hammer down on more financial crisis ne'er do wells, because the commission appears to be winding down crisis-related investigations. That's what the Wall Street Journal has concluded after getting word from sources that... More »

Feds Sue BofA Over 'Jumbo' Loans

Bank accused of hiding information about risky prime mortgages

(Newser) - The US Justice Department filed another lawsuit against Bank of America today—this one a civil suit claiming the bank had defrauded investors over $850 million in mortgage-backed securities. Investors lost $70 million and will lose $50 million more, the suit contends, after prime mortgages that supported the securities went... More »

Feds Sue JPMorgan Over Bear Stearns Shenanigans

Meanwhile, Morgan Stanley fined for Facebook IPO irregularities

(Newser) - JPMorgan is staring down a lawsuit over Bear Stearns' alleged mortgage-backed securities misconduct. The National Credit Union Administration, the federal regulator that oversees credit unions, has sued the big bank, alleging that Bear Stearns misled the credit unions it sold $3.6 billion in securities to, causing many to collapse,... More »

Goldman Mortgage Class-Action Suit Revived

Ruling a victory for investors who say they were misled

(Newser) - Goldman Sachs won't be charged for its role in the financial crisis , but it still faces plenty of lawsuits from clients it's accused of criminally misleading —and the list just got longer. A federal appeals court has decided to revive a class-action suit over mortgage-backed securities, and... More »

Goldman Won't Be Charged Over Financial Crisis

Not enough evidence to pursue fraud cases, feds decide

(Newser) - Looks like Goldman Sachs is off the hook for its role in the financial crisis. The Justice Department and Securities Exchange Commission have ended two investigations into the bank's role in the crisis, concluding that "there is not a viable basis to bring a criminal prosecution with respect... More »

Why Obama Won't Nail Wall Street 'Crooks'

Even Eric Holder is linked to elite financial world

(Newser) - With President Obama's campaign officially underway , two journalists examine why his promise to end "business as usual" on Wall Street has amounted to more, well, business as usual on Wall Street. "Casting Romney as a plutocrat will be easy enough," write Peter Boyer and Peter Schweizer... More »

Why It's Better to Default on a $1M Mortgage

Deadbeats stay in pricey homes up to 6 months longer

(Newser) - If you've fallen behind on your mortgage payments, here's hoping you live in a million-dollar home, because odds are the bank will wait a lot longer to kick you out. Borrowers who default on loans of $1 million or more get to stay in their homes an average... More »

Bank of America Agrees to $8.5B Settlement

With another $8.5B to come

(Newser) - Bank of America has, as expected , reached an agreement for an $8.5 billion settlement with a group of disgruntled investors who lost truckloads of money buying mortgage-backed securities from Countrywide Financial, the bank announced today. It’s the largest payoff yet from a financial services firm, the Wall Street ... More »

Banks to Pay SEC for Financial Crisis Fraud

They're near deal to settle allegations on mortgage-bond deals

(Newser) - A number of top Wall Street banks are on the verge of settling fraud allegations with the SEC for the mortgage-bond shenanigans that led to the financial crisis, sources tell the Wall Street Journal . The cases are being handled individually, since each bank faces substantially different charges, with the first... More »

Senate Probe: Goldman Sachs Shafted Clients, Lied to Us

Recommends perjury charges for Blankfein

(Newser) - Goldman Sachs may have criminally misled its clients when it sold them mortgage-backed securities without mentioning that Goldman itself would profit if they failed, the Senate’s Subcommittee on Investigations has concluded, recommending that the Justice Department and SEC consider pressing charges. The panel also recommended perjury charges against CEO... More »

Treasury to Sell Off $142B in Toxic Assets, Make Billions

'Notably improved' market means $15B-$20B profit for taxpayers

(Newser) - The Treasury Department will start selling the $142 billion portfolio of mortgage-backed securities, the "toxic" assets it bought up during the financial crisis , the Wall Street Journal reports. The securities are mostly 30-year, fixed-rate mortgage-backed securities guaranteed by either Fannie Mae or Freddie Mac. And having bought the securities... More »

White House: Let's Kill Fannie, Freddie

Obama administration wants to get out of the mortgage market

(Newser) - The Obama administration will propose dissolving Fannie Mae and Freddie Mac and reducing the federal government’s role in the mortgage market, sources tell the Wall Street Journal . The White House is set to release three plans for moving forward without the government-owned mortgage giants, which originated nine out of... More »

Investors Sue Countrywide Over 'Massive Fraud'

Their triple-A-rated securities are now junk, they claim

(Newser) - Investors are suing Bank of America’s Countrywide mortgage unit, claiming they were fraudulently led into purchasing supposedly triple-A-rated mortgage-backed securities that turned out to be junk. Between 2005 and 2007, the investors bought hundreds of millions of dollars of securities that were supposed to be “conservative” and “... More »

Investors Flee Banks Over Mortgage Mess

Analysts estimate huge losses

(Newser) - Investors sent bank stocks plunging yesterday, as they finally started to worry about the mortgage robo-signing scandal. Up until now, investors have mostly assumed the crisis would blow over. But on Wednesday, 50 states announced investigations into mortgage servicing practices, and yesterday a San Francisco hedge fund circulated a report... More »

New Probe: Did Banks Dupe Credit Raters?

New York AG Andrew Cuomo investigates 8 big banks

(Newser) - More bad news for bankers: New York's attorney general, Andrew Cuomo, is investigating whether banks deliberately misled rating agencies ahead of the housing market collapse. So far, authorities have focused on dealings between banks and clients who purchased mortgage-backed securities, notes the New York Times . Cuomo's crusade broadens the scope... More »

It's Time to Stop the Looters on Wall Street

And financial reform is the only way to do that

(Newser) - The SEC's charges against Goldman Sachs reveal a whole new kind of fraud at work in the financial crisis, writes Paul Krugman of the New York Times . If Goldman had simply sold securities while betting they would fail, it would be “reprehensible” but not illegal. But selling securities deliberately... More »

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