Financial Regulatory Forum

U.S. Justice Department unit to ramp up hiring as mortgage probes advance

By Guest Contributor
March 6, 2012

By Emmanuel Olaoye

NEW YORK, March 6 (Thomson Reuters Accelus) - The U.S. Justice Department plans to step up its hiring of staff to investigate abuses in the packaging of residential mortgage backed securities and to work with regulators to uncover serious fraud, a senior department official told Thomson Reuters in the wake of criticisms that Obama administration efforts were insufficient.

SEC’s “re-markable” action against Credit Suisse traders

By Guest Contributor
February 10, 2012

By Thomson Reuters Accelus – Staff

NEW YORK, Feb.10 (Business Law Currents) - A new SEC complaint against former Credit Suisse (CS) employees shines a harsh light on an underappreciated aspect of the financial crisis: mark-to-market manipulation. Charging four traders and investment bankers with violating securities laws, the commission’s civil action (“the complaint”) alleges a “colossal fraud” to misstate the value of bonds held in the bank’s portfolio. U.S. Attorney Preet Bharara of the Southern District of New York also filed a criminal indictment against CS investment banker David Higgs, a managing director of the bank’s London office. Bharara likewise filed a criminal information against CS trader Salmaan Siddiqui, who held the title of vice president.

How the BofA settlement deal got made

By Alison Frankel
June 30, 2011

There are only 30 lawyers at Gibbs & Bruns, the Houston litigation boutique that orchestrated Tuesday’s $8.5 billion settlement between Bank of America and mortgage bond investors. But good things come in small packages. This deal, struck with the noteholders in 530 trusts that issued securities backed by Countrywide mortgage loans, would not have happened without Gibbs partner Kathy Patrick. She put together a coalition of major institutional investors that BofA’s trustee on the securitizations, Bank of New York Mellon, could not afford to ignore. Patrick sent a red-alert warning to the bank last October, by announcing publicly that Gibbs & Bruns and its bondholder clients were gearing up for litigation. That move alone sent BofA’s stock down five percent. Then Patrick worked with lawyers for BofA and BoNY to structure a novel deal that makes sense for all of them.

Mortgage bankers group urges Fannie, Freddie changes

September 2, 2009

USA/   NEW YORK, Sept 2 (Reuters) – The U.S. Mortgage Bankers Association said on Wednesday it will ask Congress to transform mortgage lenders Fannie Mae, Freddie Mac into several smaller, privately held companies that would issue mortgage securities with a government guarantee.
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EXCLUSIVE: China fund plans $2 billion bet on U.S. “toxic” mortgages

By Reuters Staff
August 17, 2009

cic By George Chen, Asia Private Equity Correspondent

HONG KONG, Aug 17 (Reuters) – China’s $200 billion sovereign wealth fund, which lost big on its ill-timed 2007 Morgan Stanley and Blackstone bets, plans to invest up to $2 billion in U.S. mortgages as it eyes a property market rebound, two people with direct knowledge of the matter said Monday. (more…)