RBS bankers joked about destroying the US housing market By Rob Davies


RBS bankers joked about destroying the US housing market
By Editor August 16, 2018
http://www.theeventchronicle.com/finanace/rbs-bankers-joked-about-destroying-the-us-housing-market/


A boarded up building in Cleveland, Ohio, in January 2008. In the build up to the crisis mortgage lenders were incentivised to make as many loans as possible. Photograph: Timothy A. Clary/AFP/Getty Images
Transcripts of pre-financial crisis conversations show senior bankers’ disregard for customers

By Rob Davies

RBS bankers joked about destroying the US housing market after making millions by trading loans that staff described as “total fucking garbage”, according to transcripts released as part of a $4.9bn (£3.8bn) settlement with US prosecutors.

Details of internal conversations at the bank emerged just weeks before the 10-year anniversary of the financial crisis, which saw RBS rescued with a £45bn bailout from the UK government.

The US Department of Justice (DoJ) criticised RBS over its trade in residential mortgage backed securities (RMBS) – financial instruments underwritten by risky home loans that are cited as pivotal in the global banking crash.

It said the bank made “false and misleading representations” to investors in order to sell more of the RMBS, which are forecast to result in losses of $55bn to investors.

Transcripts published alongside the settlement reveal the attitude among senior bankers at RBS towards some of the products they sold.

The bank’s chief credit officer in the US referred to selling investors products backed by “total fucking garbage” loans with “fraud [that]was so rampant … [and]all random”.

He added that “the loans are all disguised to, you know, look okay kind of … in a data file.”

The DoJ said senior RBS executives “showed little regard for their misconduct and, internally, made light of it”.

In one exchange, as the extent of the contagion in the banking industry was becoming clear, RBS’ head trader received a call from a friend who said: “[I’m] sure your parents never imagine[d]they’d raise a son who [would]destroy the housing market in the richest nation on the planet.”

He responded: “I take exception to the word ‘destroy.’ I am more comfortable with ‘severely damage.’”

Another senior banker explained to a colleague that risky loans were the result of a broken mortgage industry that meant lenders were “raking in the money” and were incentivised to make as many loans as possible.

Employees who might raise the alarm about the riskiness of such lending “don’t give a shit because they’re not getting paid”, he said.

The bank made “hundreds of millions of dollars” from selling RMBS, the DoJ said, while disguising the risk they posed to investors, which included a group of nuns who lost 96% of their investment.

By October 2007, as signs of stress began to show in the banking system, RBS’ chief credit officer wrote to colleagues expressing his true feelings about the burgeoning volume of subprime loans in the housing market.

He said loans were being pushed by “every possible … style of scumbag”, adding that it was “like quasi-organised crime”.

“Nobody seems to care,” he added.
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The DoJ criticised RBS’ failure to do due diligence on the loans it was packaging, saying the bank feared it would lose out to rivals if it performed stricter tests.

One analyst at the lender referred to the bank’s due diligence procedures as “just a bunch of bullshit”, according to the transcripts.

When the bank became concerned about the poor quality of loans and started imposing tighter due diligence, one senior banker complained, saying: “Oh, God. Does anyone want to make money around here any more?”

RBS expected to make $20m from one deal that involved trading particularly risky loans, but faced resistance from the bank’s chief credit officer.

A senior executive responded to the concerns by telling the bank’s head trader: “Please don’t fuckin’ blow this one. We need every dollar we can get our hands on.”

Internal conversations between bankers also offer some insight into their growing realisation of the poor quality of the loans the bank owned and sold.

In September 2007, one trader referred to an appraisal of loans as giving “pretty shitty results”.

The transcripts were released by the DoJ as it confirmed the details of the settlement with the bank over its trading in RMBS.

RBS said: “Under the terms of the settlement, RBS disputes the allegations but will not set out a legal defence, while the settlement does not constitute a judicial finding.”

Certainty over the scale of the settlement will allow the bank to pay its first dividend in a decade this year.

The dividend is worth £240m and the Treasury will receive £149m as RBS is still 62%-owned by the government.

Ross McEwan, RBS chief executive, said: “This settlement dates back to the period between 2005 and 2007. There is no place for the sort of unacceptable behaviour alleged by the DoJ at the bank we are building today.”

He added that the bank could now “focus our energy on serving our customers better”.

But league tables published by the Competition and Markets Authority on Wednesday placed RBS joint bottom for customer service, with fewer than half of customers saying they would recommend the bank to a friend.

RBS will have to publish the results in branches, on its website and mobile app from today.

This article (RBS bankers joked about destroying the US housing market) was originally published on The Guardian and syndicated by The Event Chronicle.

Pay Attention! Look at the money trail AFTER the foreclosure sale, by Neil Garfield


Pay Attention! Look at the money trail AFTER the foreclosure sale
Posted on July 3, 2018 by Neil Garfield
https://livinglies.wordpress.com/2018/07/03/pay-attention-look-at-the-money-trail-after-the-foreclosure-sale/

My confidence has never been higher that the handling of money after a foreclosure sale will reveal the fraudulent nature of most “foreclosures” initiated not on behalf of the owner of the debt but in spite of the the owner(s) of the debt.

It has long been obvious to me that the money trail is separated from the paper trail practically “at birth” (origination). It is an obvious fact that the owner of the debt is always someone different than the party seeking foreclosure, the alleged servicer of the debt, the alleged trust, and the alleged trustee for a nonexistent trust. When you peek beneath the hood of this scam, you can see it for yourself.

Real case in point: BONY appears as purported trustee of a purported trust. Who did that? The lawyers, not BONY. The foreclosure is allowed and the foreclosure sale takes place. The winning “bid” for the property is $230k.

Here is where it gets real interesting. The check is sent to BONY who supposedly is acting on behalf of the trust, right. Wrong. BONY is acting on behalf of Chase and Bayview loan servicing. How do we know? Because physical possession of the check made payable to BONY was forwarded to Chase, Bayview or both of them. How do we know that? Because Chase and Bayview both endorsed the check made out to BONY depositing the check for credit in a bank account probably at Chase in the name of Bayview.

OK so we have the check made out to BONY and TWO endorsements — one by Chase and one by Bayview supposedly — and then an account number that might be a Chase account and might be a Bayview account — or, it might be some other account altogether. So the question who actually received the $230k in an account controlled by them and then, what did they do with it. I suspect that even after the check was deposited “somewhere” that money was forwarded to still other entities or even people.

The bid was $230k and the check was made payable to BONY. But the fact that it wasn’t deposited into any BONY account much less a BONY trust account corroborates what I have been saying for 12 years — that there is no bank account for the trust and the trust does not exist. If the trust existed the handling of the money would look very different OR the participants would be going to jail.

And that means NOW you have evidence that this is the case since BONY obviously refused to do anything with the check, financially, and instead just forwarded it to either Chase or Bayview or perhaps both, using copies and processing through Check 21.

What does this mean? It means that the use of the BONY name was a sham, since the trust didn’t exist, no trust account existed, no assets had ever been entrusted to BONY as trustee and when they received the check they forwarded it to the parties who were pulling the strings even if they too were neither servicers nor owners of the debt.

Even if the trust did exist and there really was a trust officer and there really was a bank account in the name of the trust, BONY failed to treat it as a trust asset.

So either BONY was directly committing breach of fiduciary duty and theft against the alleged trust and the alleged trust beneficiaries OR BONY was complying with the terms of their contract with Chase to rent the BONY name to facilitate the illusion of a trust and to have their name used in foreclosures (as long as they were protected by indemnification by Chase who would pay for any sanctions or judgments against BONY if the case went sideways for them).

That means the foreclosure judgment and sale should be vacated. A nonexistent party cannot receive a remedy, judicially or non-judicially. The assertions made on behalf of the named foreclosing party (the trust represented by BONY “As trustee”) were patently false — unless these entities come up with more fabricated paperwork showing a last minute transfer “from the trust” to Chase, Bayview or both.

The foreclosure is ripe for attack.

Spread the word

FORECLOSURE HELL


I had been doing so much better about keeping up with my blogs, until about this last week. I had not gotten back to posting as much as I had in the past, but was doing much better.

I have to admit though, every month, beginning the week before foreclosure hell (the day they auction the homes foreclosed upon), have been particularly hellish.

I guess for a while, no one I know was being foreclosed upon. But beginning last month, my friends began being sold at auction again. It had been a whole year until just these last couple of months. Then all of the sudden, properties that the banks had lost interest in, out of the blue, and with little or no warning, were sold at auction.

We all managed to stop two of the sales, those two were cancelled, but last month, one was lost to foreclosure, and it took a lot of work to get cancelled, the two that were cancelled.

So, even though there may not be the number of foreclosures every month that there had been for a long time, looks like the banks have managed to get lined up, these companies, that will purchase damn near any house at auction. These companies that want to turn around and rent you your house they just purchased at foreclosure.

I told everyone, back in 2008-2009 when Goldman Sachs’ sorry ass said that “only the rich should own houses, everyone else should be renters”, that this is what could be expected. Yes, it took another 8 years for it to happen to this scale, but it is here, and it won’t be going away, till they get every one of our homes.

I have watched foreclosure sales every month since around 2006, and all the properties that were fought for, and the banks, just kind of fizzled away without a lot of fuss, homes that they realized would be close to impossible to get the foreclosed upon owner to leave, now that they can work it out to where these rent home companies, are the ones that has to get rid of the previous owners of the properties.

The banks see this as minor housekeeping, which they don’t mind at all.

$150 billion in bank fines and penalties


7 years on from crisis, $150 billion in bank fines and penalties
http://www.cnbc.com/2015/04/30/7-years-on-from-crisis-150-billion-in-bank-fines-and-penalties.html
John W. Schoen | @johnwschoen
Thursday, 30 Apr 2015 | 2:32 PM ET

(Scott Mlyn | CNBC )

Bank of America
Scott Mlyn | CNBC

More than seven years after the global financial collapse, regulators and investors are still working through an epic pile of lawsuits and other civil actions, collecting settlements, fines and other penalties for a long list of wrongdoing.

The latest settlement involved Bank of America, which agreed this week to pay $180 million to settle a lawsuit that claimed the Charlotte, North Carolina-based bank and others manipulate foreign-exchange rates, according to The Wall Street Journal. JPMorgan Chase has already settled with the same investor group, while others, including Citigroup, are expected to settle soon, the The Journal notes.

The 2013 lawsuit claimed bank traders shared customer information to profit at their clients’ expense, according to the report.

The settlement follows a seven-year effort by federal and state regulators that included dozens of actions related to a broad range of misconduct and fraud, including bilking mortgage investors, laundering money and evading taxes. So far, banks and other institutions have paid more than $150 billion in fines, settlements and other penalties, according to a tally by the Financial Times.

That compares with roughly $700 billion in profits generated by U.S. banks between 2007 and 2014, according to Federal Deposit Insurance Corp. data.

Financial penalties
Banks and other financial firms have paid more than $150 billion in fines, settlements and restitution to homeowners and investors since the finanical crisis. Click on a bubble for details, then hover over bars for payment descriptions. (SOURCE: Financial Times.)

Bank of America: $57.8 Billion
JPMorgan Chase: $31.3 Billion
Citigroup $12.8 Billion
Wells Fargo $ 9.7 Billion
PNB Paribas $ 8.9 Billion
HSBC $ 3.5 Billion
UBS $ 3.5 Billion
Sun Trust $ 2.9 Billion
Also listed are Credit Suisse, Deutsche Bank, but for which no amount of money is shown:

Bank of America
Scott Mlyn | CNBC

More than seven years after the global financial collapse, regulators and investors are still working through an epic pile of lawsuits and other civil actions, collecting settlements, fines and other penalties for a long list of wrongdoing.

The latest settlement involved Bank of America, which agreed this week to pay $180 million to settle a lawsuit that claimed the Charlotte, North Carolina-based bank and others manipulate foreign-exchange rates, according to The Wall Street Journal. JPMorgan Chase has already settled with the same investor group, while others, including Citigroup, are expected to settle soon, the The Journal notes.

The 2013 lawsuit claimed bank traders shared customer information to profit at their clients’ expense, according to the report.

The settlement follows a seven-year effort by federal and state regulators that included dozens of actions related to a broad range of misconduct and fraud, including bilking mortgage investors, laundering money and evading taxes. So far, banks and other institutions have paid more than $150 billion in fines, settlements and other penalties, according to a tally by the Financial Times.

That compares with roughly $700 billion in profits generated by U.S. banks between 2007 and 2014, according to Federal Deposit Insurance Corp. data.

Some of those involved charges against individual bankers. About 70 CEOs, CFOs and other senior corporate officers had been charged by the Securities and Exchange Commission as of October, the latest data available. The SEC says it collected $3.6 billion in penalties and other payments related to the charges.

Bank of America
Scott Mlyn | CNBC

More than seven years after the global financial collapse, regulators and investors are still working through an epic pile of lawsuits and other civil actions, collecting settlements, fines and other penalties for a long list of wrongdoing.

The latest settlement involved Bank of America, which agreed this week to pay $180 million to settle a lawsuit that claimed the Charlotte, North Carolina-based bank and others manipulate foreign-exchange rates, according to The Wall Street Journal. JPMorgan Chase has already settled with the same investor group, while others, including Citigroup, are expected to settle soon, the The Journal notes.

The 2013 lawsuit claimed bank traders shared customer information to profit at their clients’ expense, according to the report.

The settlement follows a seven-year effort by federal and state regulators that included dozens of actions related to a broad range of misconduct and fraud, including bilking mortgage investors, laundering money and evading taxes. So far, banks and other institutions have paid more than $150 billion in fines, settlements and other penalties, according to a tally by the Financial Times.

That compares with roughly $700 billion in profits generated by U.S. banks between 2007 and 2014, according to Federal Deposit Insurance Corp. data.

Some of those involved charges against individual bankers. About 70 CEOs, CFOs and other senior corporate officers had been charged by the Securities and Exchange Commission as of October, the latest data available. The SEC says it collected $3.6 billion in penalties and other payments related to the charges.

The biggest payments have gone to the Justice Department, which has collected some $50 billion, according to the FT tally.

Among the banks paying the biggest amounts, Bank of America tops the list—with nearly $58 billion, followed by JPMorgan Chase ($31.3 billion), Citigroup ($12.8 billion) and Wells Fargo ($9.7 billion).

http://video.cnbc.com/gallery/?video=3000375715