Skip to content

BANKSTER RAP SHEET UPDATE: Bank of America

May 30, 2013
DRAWN OPINIONS

DRAWN OPINIONS

2– BACK ON 10/24/12, BANK OF AMERICA WAS SUED BY THE FEDS FOR

OVER $1 BILLION IN A MULTI-YEAR MORTGAGE FRAUD. MUCH OF THE CASE IS BASED ON THE BANK’S FINANCIALLY DISASTROUS PURCHASE IN 2008 OF ITS  FORMER COUNTRYWIDE UNIT WHICH ALLEGEDLY CREATED A MORTGAGE SCHEME, CALLED THE “HUSTLE”, TO RESELL THOUSANDS OF FRAUDULENT AND DEFECTIVE MORTGAGES TO THE FEDERALLY OWNED FANNIE MAE  AND FREDDIE MAC.

THE GOVERNMENT SAID THOSE QUESTIONABLE  MANEUVERS COST TAXPAYERS ABOUT A BILLION DOLLARS WHICH THE FEDS WANT TO RECOVER.

IN A THREE -YEAR PERIOD ENDING IN 2007, COUNTRYWIDE ORIGINATED $1.3 TRILLION IN LOANS. BANK OF AMERICA’S PURCHASE OF COUNTRYWIDE HAS COST THE BANK AN ESTIMATED $40 BILLION IN REAL-ESTATE LOSSES, LEGAL EXPENSES AND SETTLEMENTS WITH STATE AND FEDERAL AGENCIES, ACCORDING TO THE WALL STREET JOURNAL.

SO WHAT’S NEW? WELL IN APRIL, THE BANK AGREED TO PAY $165 MILLION TO SETTLE ACCUSATIONS FROM THE FEDS THAT THE BANK

SOLD MORTGAGE –BACK SECURITIES TO CORPORATE CREDIT UNIONS THAT LED MANY OF THEM TO FAIL. THE CHARGES WERE BROUGHT BY THE NATIONAL CREDIT UNION ADMINISTRATION.

BUT THE BLEEDING FROM THOSE TAINTED MORTGAGES CONTINUES.  IN RECENT MONTHS, THE BANK HAS SETTLED $14 BILLION IN MORTGAGE-RELATED CLAIMS. THE BREAKDOWN:

$3 BILLION TO END LOAN-BY-LOAN REVIEWS REQUIRED BY THE GOVERNMENT.

$11.6 BILLION TO RESOLVE ACCUSATIONS FROM FANNIE MAE ABOUT IMPROPERLY SOLD MORTGAGES THAT FAILED, AND TO RESOLVE QUESTIONS ABOUT FORECLOSURE DELAYS,

$8.5 BILLION THAT THE BANK IS IN THE PROCESS TO RESOLVE CLAIMS FROM PRIVATE INVESTORS WHO BOUGHT THE SHAKY SECURITIES, ACCORDING TO THE NEW YORK TIMES. UNNECESSARY TO REPORT, THE BANK DID NOT ADMIT WRONGDOING.

I WONDER ABOUT THE REACTIONS FROM B OF A  CUSTOMERS IF THEY SAW A NEW SLOGAN OVER THE BANK DOORS: “BILLIONS PAID BUT NO WRONGDOING.”

2—BANKSTER RAP SHEET UPDATE:  HSBC PAID ALMOST  $ 2 BILLION  BUT CITIGROUP JUST HAS TO IMPROVE CONTROLS OF TAINTED MONEY BUSINESS

IN A PREVIOUS REPORT HERE ON THE MULTI ACCUSATIONS AGAINST THE HONG KONG AND SHANGHAI BANKING  CORPORATION , THE BANK HAD AGREED TO A RECORD SETTLEMENT OF $1.92 BILLION WITH THE FEDS TO SETTLE CHARGES OF TRANSFERS OF BILLIONS OF DOLLARS FOR NATIONS LIKE IRAN AND ENABLED MEXICAN DRUG CARTELS TO MOVE MONEY ILEGALLY THROUGH ITS AMERICAN SUBSIDIAIRIES. THAT WAS ONLY LAST DECEMBER.

AT THE END OF MARCH THIS YEAR, THE FEDERAL RESERVE SERVED CITIGROUP WITH A TEPID  “ENFORCEMENT ACTION” OVER BREAKDOWNS IN MONEY LAUNDERING CONTROLS THAT ALSO INVOLVED THE BANK’S MEXICAN SUBSIDIARY.

THE FED SAID THE U.S. BANK AND BANAMEX USA FAILED TO MONITOR CASH TRANSACTIONS OF POTENTIALLY SUSPICIOUS ACTIVITY, ACCORDING TO THE NEW YORK TIMES OF MARCH 27.

THE BANK SECRECY ACT REQUIRES FINANCIAL INSTITUTIONS, LIKE BANKS AND CHECK-CASHING BUSINESS, TO REPORT CASH TRANSACTIONS OF MORE THAN $10,000 AND ALERT REGULATORS TO ANY DUBIOUS OR EXTRAORDINARY ACTIVITY.

BANKS ARE REQUIRED TO HAVE EXTENSIVE AND COMPLEX CONTROLS TO MONITOR CRIMINAL ACTIVITY WHICH, REGULATORS HAVE LONG ARGUED, ALLOW DRUG DEALERS AND TERRORISTS TO LAUNDER MONEY THROUGH AMERICAN BANKS.

THE ENFORCEMENT ACTION REQUIRES THE BANK’S BOARD TO PRESENT A PLAN TO STRENGTHEN TRANSACTION MONITORING AND HAVE A COMPLIANCE RISK PROFILE AIMED AT STOPPING ILLEGAL MONEY TRANSFERS.

THE BANK IS ALREADY UNDER A CEASE-AND-DESIST ORDER THAT THE OFFICE OF THE COMPTROLLER OF THE CURRENCY (OCC) ISSUED LAST APRIL. THAT FEDERAL REGULATOR IS THE BANK’S PRIMARY GOVERNMENT OVERSEER.

IN THAT ORDER, THE GOVERNMENT DEMANDED THE BANK TO IMPROVE ITS MONEY-LAUNDERING CONTROLS AND ACCUSED CITIGROUP OF VIOLATING THE BANK SECRECY ACT.

SO WHY HAS MORE THAN A YEAR PASSED WITH TWO OF THE GOVERNMENT’S MORE  POWERFUL REGULATORS ESSENTIALLY WAITING FOR THE BANK TO FILE REAMS OF REPETITIVE PAPER WORK ,

WHAT HAS IT COST THE GOVERNMENT IN DUPLICATION, PAPER WORK  AND THE INABILITY TO CARRY OUT THEIR OWN ORDERS?

AS USUAL, THE BANK AND ITS AFFILIATE ADMITTED NO BLAH, BLAH ETC.

AND THE MEXICAN CARTELS HAD NO COMMENT.

Advertisements
Leave a Comment

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: