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Post Frequency: 1.9/day Last Entry: November 19, 2009 at 23:20:00 Recent Entries: 620
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Another Day of Progress in D.C.
Posted on November 19, 2009Whatever Mark Zandi's smoking, I want a toke. Testifying today before the Congressional Oversight Panel that "oversees" the Treasury Department's TARP, Mr. Zandi made a bold assertion. Mark Zandi, the chief economist and cofounder of Moody?s Economy.com, said that banks...
To The Contrary
Posted on November 18, 2009Former client and long time banker Pat Dalrymple (the subject of a previous post) has joined the world of banking bloggers with "Contrabanker: A Bank Contrarian's Blog"). If Pat's first post is any indication, he's going to provide a no-holds-barred,...
Talking Trash 'Bout TARP
Posted on November 17, 2009Sheila Bair said last week that the TARP CPP program was, in retrospect, maybe not such a good idea. ?I just see all the problems it?s created now,? she said in an interview with PBS economics correspondent Paul Solman. ?The...
It's As Bad As You Think
Posted on November 16, 2009Another astute observer of the banking scene jumped on the 1,000 bank failures band wagon today. James Dunne, senior managing principal of Sandler O'Neill, said he believes up to 1,000 banks will fail during the current crisis and the total...
Wal-Mart Marches On
Posted on November 15, 2009Last week, the American Banker featured a story by Maria Aspan (paid subscription required) that looked at Wal-Mart's business of providing consumer financial services to its customers, two years after it finally gave up its quest to get the FDIC...
We Interrupt This Madness To Bring You The Following Insanity
Posted on November 12, 2009I had a juicy topic related to the banking reform legislation sweeping through D.C. all teed up and ready to knock out of the ballpark, but, unfortunately, a friend turned me on to the fact that all legislative activity in...
Ohio Whiffs Payday Putdown
Posted on November 11, 2009The Ohio legislature's efforts to eliminate payday lending continue to be stymied by the marketplace, where willing, if desperate, borrowers need money and willing lenders stand ready to fill that need, at rates and fees that would make Shylock green...
Chris' Big PR Adventure
Posted on November 10, 2009According to Darrell Delamaide at FinReg21, Senator Chris ("Friend of Angelo's") Dodd opened a public relations campaign to try to burnish his tarnished reputation in Connecticut by introducing in the Senate today financial institution reform legislation that makes that proposed...
Any Takers For TARP II?
Posted on November 09, 2009TARP II (aka Son of TARP, TARP, Jr., TARP Lite, Tofu TARP, One-Horse TARP, and Diet TARP) is hardly out of the starting gate but is already down on the track with a broken ankle and looks like it might...
Handwriting on the Wall?
Posted on November 08, 2009In mortgage banking, the "elephant in the room" used to be repurchase obligations. That elephant (just like Sarah Palin) "went rogue" over the past two years and as a result, mortgage loan investors are busy trying to ensure that if...
Looking For Lessons in the Madness
Posted on November 05, 2009While most of the press focused on the FDIC's use of the cross-guaranty provisions of FIRREA, a couple of other interesting tidbits floated to the surface near the shipwreck that occurred last Friday when the OCC sank, and FDIC took...
The Man In The Mirror
Posted on November 04, 2009We have met the enemy, and he is us. ---Walt Kelly A former client, Pat Dalrymple, who for many years was the president of a savings banks headquartered in Greenwood Village, Colorado (a suburb of Denver), and before that one...
LOAN MODIFICATION GUIDELINES: BANK LIFELINE OR LICENSE TO LIE?
Posted on November 03, 2009The following is a guest post by John M. Walker, Jr., an attorney and business executive with over 30 years of experience in finance and real estate. It?s been an interesting few days for those who follow commercial real estate...
Much Too Little, Way Too Late
Posted on November 02, 2009Six months ago, knowledgeable observers were moaning about unreasonably arbitrary and harsh examinations of community banks by examiners who seemed eager to choke off bank credit at a time when it was desperately needed. Last week, Congressional leaders finally caught...
Regulators to Private Equity: Take It Elsewhere
Posted on November 01, 2009A couple of articles on Friday's The Deal.com focused on how difficult it is for "private equity" investor groups to help the FDIC address the needs of commercial banks and thrifts for more capital and to increase the pool of...
Unintended Consequences And Potshots From The Peanut Gallery
Posted on October 29, 2009It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the...
The Everyready Energizer Defendant
Posted on October 28, 2009Some might think that it's hard to believe that supervisory goodwill cases arising out of bank failures that occurred in the 1980s are still working their way through the federal court system, but those faithless readers of this blog know...
Bad Actors For Bad Times
Posted on October 27, 2009Bad times for banks are also bad times for their customers. Now that the body count of dead banks has zipped past 100 (with a bullet), vermin are crawling out of the sewers to take advantage of the bad news....
Hot Off The Wire
Posted on October 26, 2009I've received some updated information concerning prior posts that I'll pass along. In a recent post on de novo banks, I mentioned an interview with Commerce Street Capital's Charles Ingram and Derek Cunningham. Charlie thoughtfully provided me with a link...
Backpeddling on Chair Bair
Posted on October 25, 2009FDIC Chairman Sheila Bair, who, unlike certain others in our nation's capitol who we won't name, is a master in dealing with the press, dropped some interesting tidbits last week at a Reuters Washington Summit. First, she said "she should...
He Who Laughs Last
Posted on October 22, 2009While much of the business press was focused on Czar Feinberg's cap on bailed-out bank executive compensation and the Federal Reserve's proposed rules to limit executive compensation at banks and bank holding companies that it supervises, the House Financial Services...
Son of TARP Takes Flight
Posted on October 21, 2009I suppose that it's too soon to have more than a knee-jerk reaction today's announcement by President Obama that he'll propose legislation to "goose" lending to small businesses and to help community banks with what's left of the TARP money....
It's Good To Be Too Big To Fail
Posted on October 20, 2009Sheila Bair offered a sharp observation yesterday, one with which community banks are certain to agree. As the Federal Deposit Insurance Corp. braces for the 100th bank failure this year ? the most since 1992 ? Bair warned that small...
The Big Get Bigger
Posted on October 19, 2009There's a bit of good news and bad news for commercial banks. The good news, according to the CRE-beat blog, is that commercial real estate loans shouldn't bring down the nation's largest banks (in excess of $1 billion in assets)....
"Prudent" Financial Regulation
Posted on October 18, 2009Over at the Financial Post, Jagadeesh Gokhale and Peter Van Doren meet calls for tighter regulation of financial institutions with the argument that tighter regulation won't make things better, it will make things worse. I've heard many argue that financial...
Into The Wild Blue Yonder
Posted on October 15, 2009I'm on the road with clients until next week. Be safe, don't drive while holding a cell phone (like The Governatrix of California), don't dance with stress fractures in both feet (like The Hammer), and whatever you do, don't fly...
You're Never Too Old To Be De Novo
Posted on October 14, 2009The American Banker ran an article last week (paid subscription required) about the FDIC's new policy that applies to state chartered, non-Fed-member banks that are less than three years old. The FDIC announced in late August that it will require...
A Healthy Disagreement
Posted on October 13, 2009Last week we posted Chris Whalen's claim (via Alain Sherter at BNet.com) that over 1000 FDIC-insured banks would fail at a cost to the fund of $500 billion. Saturday's The New York Times posted a similar claim (as to the...
More De Novo News
Posted on October 12, 2009A correspondent who reads this blog let me know late last week that although he had given up on his de novo charter application because of a long period of inaction by the FDIC (the state regulator had approved his...
It's The Same Old Song
Posted on October 11, 2009Here we go again: from three years ago: It also states in my Disclaimer that "[n]othing on this blog is intended to be a solicitation of, or the provision of, legal advice, nor to create an attorney-client relationship with me...
Small Banks Not Fans of Single Federal Bank Regulator
Posted on October 08, 2009Although the FDIC has been tough on many small banks, mowing down the more distressed among them in droves, one thing small banks agree on with Sheila Bair is that the single federal bank regulator proposed by the Obama administration...
No Harm, No Foul...This Time
Posted on October 07, 2009I suspect that many who read the recent report of a community bank employee in Wyoming who inadvertently sent confidential information on 1,300 or so of the bank's customers to the wrong Gmail address thought (perhaps only fleetingly): "There but...
It's Always Darkest Right Before You Die
Posted on October 06, 2009Alain Sherter of BNet recently broke the news that bank industry analyst Chris Whalen (whose "hot opinions" on all things banking at his Institutional Risk Analyst blog and elsewhere I've admired for some time) estimates, in an upcoming article in...
More Sad Tales of De Novo Woe
Posted on October 05, 2009According to the Philadelphia Business Journal, even taking the politically correct de novo tack of promoting "diversity" doesn't seem to be able to buy new bank organizers a ticket to the FDIC's dance. While existing startup banks grapple with the...
There IS Rest For The Weary
Posted on September 28, 2009The blog is on vacation until next week. Enjoy a snark-less week.
Then Again
Posted on September 24, 2009A couple of follow ups to recent blog posts: The New York Times ran a story last week about the strong fight that industrial banks are waging to preserve their form of charter in the face of an assault on...
Ego and Ambition Got in the Way
Posted on September 23, 2009We were just speaking about Angelo Mazilo, former Chairman of Countrywide, and darned if I didn't finally get around today to reading a recent profile about him in The Los Angeles Times, a newspaper that, according the article, Mazilo loathes....
Singing The No-Perp Walk Blues
Posted on September 22, 2009CNNMoney.com's Colin Barr asks, "Where are the subprime perp walks?" and expresses dismay that, three years after the advent of the subprime mortgage crisis, not one major case has been brought by criminal prosecutors against senior executives tied to the...
Colorado Not Grading On A Curve
Posted on September 21, 2009The situation in Colorado for independent mortgage brokers gets tougher every day. When we posted earlier this month about the decision of Colorado Director of Real Estate Erin Toll to deactivate the licenses of over half of the state's licensed...
Hindsight Is Always 20/20
Posted on September 20, 2009Francine McKenna of re: The Auditors fame wrote a post on Clusterstock today that irritated at least one anonymous commenter to the post. I get a kick out of the bravery that's fostered by anonymity. Francine wondered why the financial...
Turnabout Is Not Fair Play
Posted on September 17, 2009The FDIC's practice of "loss sharing" with acquirers of "bad assets" of failed banks and thrifts reached another level with the recent sale of a mixed bag of loans from the failed Franklin Savings of Austin (30% of which are...
Time For A Break
Posted on September 16, 2009I was going to post about something serious this evening and I just don't have the heart. No, that's not right. I just don't have the time. Well, I have neither. So, for something completely off-topic, and off-the-wall, here's an...
Tone Deaf Player Ejected From Band
Posted on September 15, 2009When I read this story from The Los Angeles Times late last week, I thought to myself that there has to be a limit to how tone deaf a person can be to public sentiment and still keep his or...
Other Federal Bank Regulators To FDIC: Thanks, But No Thanks
Posted on September 14, 2009FiCri Advisor followed up a post of last week about the FDIC's new policy for de novo banks (which prompted my thoughts on the matter here) with another post over the weekend. They asked the remaining federal commercial bank regulators...
Bair To Lenders: Borrower Forbearance Is A Good Thing
Posted on September 13, 2009Sheila Bair's press release last Friday was a publicity stunt that generated the expected snarky e-mails piling up in my e-mail in-box. Her statement that lenders always "win" by extending forbearance to borrowers and temporarily lowering their monthly mortgage payments...
Do You Feel Lucky Today?
Posted on September 10, 2009FinCri Advisor disputes at least a portion of the FDIC's rationale for its recently adopted restrictions on newly chartered state nonmember banks. The FDIC says its recent decision to expand the de novo supervisory period from three to seven years...
No Multi-Factor Authentication Equals Negligence?
Posted on September 09, 2009Remember the multi-factor authentication guidelines for online banking that the FFIEC adopted a few years ago? The ones that bank were supposed to have complied with by the end of 2006? The ones we last posted about here? Believe it...
An Unwritten Rule Wreaks Havoc
Posted on September 08, 2009On the heels of a post of a couple of weeks ago, which related the sorrowful tales of disappointed applicants for de novo bank charters who have been left at the alter by the FDIC, I received an e-mail from...
From The Horse's Mouth
Posted on September 07, 2009One session during the business meeting of the National Association of Industrial Bankers on August 21 consisted of a presentation by local representatives of the FDIC and the Utah Department of Financial Institutions as to their "regulatory hot buttons...
Competition Is The Best Protection
Posted on September 03, 2009As the power of the state increases we must declare with regret?a respectful regret, that?s understood of course, for we are respectful citizens?that this All-Powerful Being does not gain in morality as much as it gains in power. ---Georges Bernanos,...
Industrial Banks: Take A Long Hard Look
Posted on September 02, 2009While sitting around, exploring all the wonderful features and applications of my new I-Phone, I began to reminisce of days gone by, days of long ago. In other words, I was thinking of the week before last when I spent...
Culling The Herd
Posted on September 01, 2009The "disaster" that Colorado's Director of Real Estate, Erin Toll, warned about a couple of months ago, has come to pass. The Colorado Division of Real Estate on Monday inactivated 4,560 mortgage broker licenses, about half of the licenses in...
Loss Sharing: A Tempest In A Teapot
Posted on August 31, 2009A front page story in today's The Wall Street Journal must have thrown a lot of people off their feed, judging by the vitriol hurled about in the online comments section to that article. A superficial reading of the beginning...
FDIC Making It Even Harder For De Novo Banks
Posted on August 30, 2009Regulators, like most of the rest of us, are adept at fighting the last war. Friday's release of Financial Institutions Letter 50-2009 is a classic case of slamming the barn door after the horses are loose. The policy outlined in...
Filled With Inertia
Posted on August 26, 2009This past January we related the sad tale of a de novo bank charter applicant who spent $2 million in organizational costs before the FDIC finally got around to telling it what the FDIC should have told it to begin...
The Best Umbrella
Posted on August 25, 2009The head of a Big 3 financial institutions consulting practice group was relaxing over cocktails with a friend of mine and me almost ten years ago and made one of the classically cynical remarks that drives clients berserk. We were...
Dead Man Taking
Posted on August 24, 2009A couple of weeks ago, former disgraced Wall Street analyst Henry Blodget, a man flushed from his perch by The Sheriff of Wall Street, Eliot Spitzer, sat down with the former disgraced Attorney General and Governor of New York and...
Dead Man Talking
Posted on August 24, 2009A couple of weeks ago, former disgraced Wall Street analyst Henry Blodget, a man flushed from his perch by The Sheriff of Wall Street, Eliot Spitzer, sat down with the former disgraced Attorney General and Governor of New York and...
Oversharing
Posted on August 23, 2009Although this article does not discuss problems that are confined to employees of banks, it's apropos of a talk I gave Friday on, among other related topics, the problems that can arise when employees of banks use social media. According...
Heading For The Hills
Posted on August 18, 2009The blog will be on vacation for the rest of this week. I'm headed to Utah for the annual convention of the National Association of Industrial Banks and the Utah Association of Financial Services. They've asked me to speak on...
With Friends Like These
Posted on August 17, 2009FinCri Advisor recently ran a story about private equity investors and how they?re making it expressly clear that they?ll bow out of transactions to buy failed banks from the FDIC unless major changes are made to the policy recently proposed...
It's Seriously Like Bizarro World
Posted on August 12, 2009The news late last week that Senators Dodd and Conrad skated on charges that they violated US Senate ethics rules arising out of their being "Friends of Angelo's" hardly took the country by surprise. A typical comment in The Wall...
Snark Attack
Posted on August 11, 2009A banker friend uttered the obscene phrase "open bank assistance" the other day and wondered why investors with as much "pull" as Carl Icahn and Robert Rowling have apparently not been able to "pull off" a rare open bank assisted...
One Too Many Allegations
Posted on August 10, 2009Another stunt started with a bang by Eliot Spitzer was completed by the SEC with a whimper last week. Hank Greenberg, the former AIG CEO who refused to settle with Spitzer or the SEC in 2006 when AIG bit the...
Trolling for Tin Foil Hats
Posted on August 09, 2009Jr Deputy Accountant (aka Adrienne Gonzalez) wrote a short post Friday for the Going Concern blog that raises an auditor's red flag about the "going concern" viability of one of bedrocks of the nation's financial stability. No, not Warren Buffet,...
Pay Masters of the Universe
Posted on August 05, 2009Sheila Bair publicly aligned herself with Barney Frank today on the need for curbs on executive compensation, which comes as absolutely no surprise to anyone who has watched her consistent maneuvering to please the radical left faction of the Democratic...
Bairing Her Claws
Posted on August 04, 2009Rolfe Winkler gave Sheila Bair some kudos today for her testimony before Congress this week, including for her demonstration of a high level of testosterone in telling potty-mouthed Tiny Tim Geithner that he can utter obscenity-laced tirades until his mouth...
Arizona's Law of Unintended Consequences
Posted on August 03, 2009Bankers and realtors are clawing and scratching at each other again, this time in Arizona over a new law that takes effect September 30 and that removes that state law's "anti-deficiency" protection for homes owned by borrowers who have not...
A Minor Irritation Blossoms Into A Major Headache
Posted on August 02, 2009While this blog was bogged down with the trivial pursuits that customarily fill its days, it neglected a major news story from the past two weeks, namely the David versus Goliath victory of the owner of the web site "Goldmansachs666.com"...
TARP Takers Are Tired
Posted on July 29, 2009Banks who took TARP recapitalization investments and hung on to them have had it with being poor mouthed by pinheads in the nation's capitol. According to FinCr Advisor, they're getting so gosh darn tired of being subject to media "gotchas"...
Countrywide Continues To Pay The Piper
Posted on July 28, 2009In February of this year, Colorado?s Attorney General proudly announced that ?Colorful Colorado? had squeezed $6 million out of Countrywide Financial Corp. for alleged violations of Colorado?s Consumer Protection Act, arising out of Countrywide?s subprime mortgage lending in that state...
Mile High Mortgage Brokerage "Disaster"
Posted on July 27, 2009In 2006, we reported on the trouble that Danny Payne, then commissioner of the Texas Department of Savings and Mortgage Lending, was having with mortgage brokers who couldn't pass a basic test of compliance knowledge that was required by Texas...
Bair Turns The Corner
Posted on July 26, 2009According to last Friday's The American Banker, when it comes to working Congress, Sheila "Care" Bair is a grand master and guys like Tiny Tim Geithner haven't yet mastered checkers. Not even Chinese checkers. The Change We Have Been Waiting...
Barney Ain't To Blame
Posted on July 23, 2009A reader sent me a link to a video of an interview with Barney Frank in which Barney engages in rapid-fire rewriting of history, and asked me what I thought of it. I thought it was business as usual for...
Cramer v. Kramer
Posted on July 22, 2009When Jim Cramer bashes Sheila Bair, I am reminded of the famous saying "The enemy of my enemy might still be a butt-head." Cramer and his sock puppet staff writer are put out that Sheila failed to extend a helping...
CRE Tsunami
Posted on July 22, 2009Yesterday's The Wall Street Journal disclosed a frightening factoid that those of us who represent community and regional banks have been aware of for some time now (unfortunately, for some of our clients). U.S. banks have been charging off soured...
Let The Good Times Roll
Posted on July 20, 2009It seems that these days, there's nothing but bad news coming out of this nation's capitol, a town I like to call "Washington, D.C." but other, less charitable types refer to as "A Sullen City In A Swamp." Therefore, when...
A Calm And Measured Tone
Posted on July 19, 2009Former FSLIC official, and current college professor, Bill Black, has been trying to paint the banking industry with a broad bush just chock-full of black paint for decades. To me, he is, and has been for some time, a cartoon...
Winners and Losers
Posted on July 15, 2009It matters little who's in power in D.C. You can rest assured that whoever is at the helm of the federal government's ship of fools, the big will be bailed out and the little will be allowed to sink unmourned....
Baltimore Lives To Fight Its Oppressors Another Day
Posted on July 14, 2009It's easy to sit there and say you'd like to have more money. And I guess that's what I like about it. It's easy. Just sitting there, rocking back and forth, wanting that money. ---Deep Thoughts, by Jack Handey Cleveland...
Advance Fee Scams: To File Or Not To File
Posted on July 13, 2009We've long been fond of "419" e-mails, named after the section of Nigerian law that prohibits them. Most or perhaps all of you reading this blog have received an e-mail similar to the following real-life example, posted on the 419-busting...
Foreclosure Moratoriums A Bust
Posted on July 12, 2009Paul Jackson, editor-in-chief of HousingWire Magazine and Housingwire.com, is not shocked by the results of report releases recently by Clayton Holdings, Inc. Widespread foreclosure freezes that began in late last year and ran through the first quarter of this year...
Criminalizing Corporate Governance
Posted on July 09, 2009Emily Flitter at BankThink concisely summarizes a recent useless contretemps among conservative and liberal bloggers and newspaper columnists over a proposal by leftard Paul Collier of Pravda The Guardian to make bad business decisions by bank managers that lead to...
Killing The PE Golden Goose?
Posted on July 08, 2009Those who can, do, those who can't teach; and those who can do neither, administer. ---Calvin Calverley Last week's release by the FDIC of a proposed policy statement on the acquisition of assets and deposits of failed banks and thrifts...
Overheating The Brakes On Preemption
Posted on July 07, 2009The harsh winds of speculation blew across the blogosphere this week about the dire possibilities unleashed by the decision last week of Nino and The Leftists to throw down some spike strips in the path of the OCC's speeding muscle...
Straight Talk
Posted on July 06, 2009Former OCC attorney John Podvin, currently lodged in the Dallas office of Texas-based law firm Haynes & Boone, was interviewed last week by Metropolitan Corporate Counsel magazine. He had some ?hot? opinions about the expected course of federal bank regulation,...
A Chink In The Armor Of Federal Preemption
Posted on July 04, 2009After getting a chance to actually read the majority and dissenting opinions in Cumo v. Clearing House Association, rather than merely press reports of the same, I find the opinions themselves only mildly surprising, for reasons that don't have to...
It Takes A Village...Of Idiots
Posted on July 02, 2009Most bankers and bank regulators appear to be on hiatus until next week. The double whammy of Friday "flex day" and the day before a Saturday holiday has apparently driven the "bank biz" to seek a pool, an umbrella, and...
Boneheads Bash Bogus Tweeters
Posted on July 01, 2009A report in today's Wall Street Journal about consumer advocates organizing a hash-tag "tea party" to assault what the advocates thought was a Goldman Sachs Twitter account, but that turned out to be a fake Tweeter Bird, wasn't quite as...
Blindsided
Posted on June 30, 2009I returned to the office today, haven't had time to read the SCOTUS opinions in Cuomo v. Clearing House Association, and won't get a chance to read them until this weekend. Therefore, I'll save my bloviating about it until next...
On The Road Again
Posted on June 24, 2009My misanthropic nature periodically takes a whipping, usually at the instigation of my spousal unit. The next week is one of those times, when we must hit the road and visit family members. Inasmuch as my wife's family never heard...
ILCs: Plenty Of Fight In The Dog
Posted on June 23, 2009It's not the size of the dog in the fight, it's the size of the fight in the dog. ---Mark Twain While the OTS has been getting much of the attention of the trade press for being singled out by...
Ice Skating Through Hell
Posted on June 22, 2009I'm lounging around the Colorado Diablo Bar & Grill on the Eighth Level of Hell last Friday, knocking back my second boilermaker of the afternoon with my old pal, The Prince of Darkness himself. He tells me that I've got...
Bair-ly Everywhere
Posted on June 21, 2009No sooner had Treasury Secretary Tim ("Pinocchio") Geithner issued the Obama administration's regulatory reform white paper last week, then FDIC Chairman Sheila Bair was praising it out one side of her mouth and bashing it out of the other side....
"Dead Man Walking!"
Posted on June 18, 2009The weeping and wailing has already begun for the Office of Thrift Supervision. Fingered for liquidation (along with the federal thrift charter) by the Obama administration's "reform" plan that was announced yesterday, Reuters called it "The Saddest, Unloved Bank Regulator...
Igornace Is Not Bliss
Posted on June 17, 2009Paul Jackson, editor-in-chief of Housingwire.com and HousingWire Magazine, expressed his frustration yesterday with federal policy makers' apparent lack of comprehension of how the country's mortgage financing markets work. To me, their ignorance is par for the course...
Ignorance Is Not Bliss
Posted on June 17, 2009Paul Jackson, editor-in-chief of Housingwire.com and HousingWire Magazine, expressed his frustration yesterday with federal policy makers' apparent lack of comprehension of how the country's mortgage financing markets work. To me, their ignorance is par for the course...
A Plethora Of Political Incorrectness
Posted on June 16, 2009Some days, when I'm especially pressed for time, I seriously consider bagging putting up a post. Then, out of the blue, my readers will supply me with material too good to pass on. Two recent examples beg for a post....
More Evidence That Failed Bank Directors Are In FDIC's Crosshairs
Posted on June 15, 2009If you're not reading FinCri Advisor, you should be. It's putting out some of the most useful commentary on the financial crisis to be found on the internet. No, I have no connection with Fin Cri Advisor and this is...
Jeb Hensarling: Modern Day Don Quixote
Posted on June 14, 2009I didn't agree with Texas Congressman Jeb Hensarling, the only sitting member of Congress who serves on the TARP Congressional Oversight Panel, when he initially opposed the Bush administration's original TARP proposal last year. I can't say that I agree...
Barney Frank: Corporate Governance Expert
Posted on June 11, 2009House Financial Services Committee Chairman Barney ("Boy George") Frank flew off the deep end this morning when CNCB's Mark Haines challenged the basis for Frank's argument that shareholders of banks and other businesses must have a right, mandated by federal...
Georgia On My Mind
Posted on June 10, 2009We said recently that Georgia is a hot bed of failed banks. A story in today's The Wall Street Journal by Damian Paletta and Dan Fitzpatrick gives us facts to back up the assertion. The state is home to just...
Ohio: Land of the Lost
Posted on June 09, 2009While most of the sneering generated by Ohio municipalities who blame mortgage lenders and securitiziers for the pitiful state of their fiscal and physical condition has been directed against Cleveland, we should not forget another veritable Eden-on-Earth, Cincinnati, the city...
Regulatory Exclusion
Posted on June 08, 2009Recently, in response to a post I did about the FDIC allegedly preparing to sue directors and senior executives of failed banks in Georgia, a regular reader e-mailed me to ask whether the threat was a credible threat in light...
The Inmates Run The Asylum
Posted on June 07, 2009When you think of experienced banking gurus with genius-level IQs, commercial banking expertise, and decades of hands-on experience solving real-world commercial banking problems, the kind of gurus most qualified to select senior-level executives for one of the world's largest financial...
History Lessons
Posted on June 04, 2009Adrienne Carter at Businessweek isn't happy about yesterday's revelations in The Wall Street Journal about the success of bank lobbyists in influencing Congress to pressure FASB to relax mark-to-market accounting rules for banks' so-called "troubled" assets, which FASB did in...
Stressed Out
Posted on June 03, 2009A couple of weeks ago, FinCri Advisors warned that as a result of the stress tests administered to the nation's top 19 banks, community banks should batten down the hatches, stock plenty of ammo, concertina wire, bottled water, and condoms...
Fisking a TALF Ralfer
Posted on June 02, 2009Last month, Elizabeth Warren, Harvard law professor and head of the Congressional Oversight Panel (COP) that looks over the shoulder of the Treasury Department on its various bailout programs, was busy undermining the Treasury's PPIP. According to Housing Wire's Linda...
The Glass Is Half Empty
Posted on June 01, 2009FinCri Advisor advises us that the recent federal district judge's dismissal of a lawsuit brought by the city of Cleveland against banks and investment banks (which we discussed last week) is no cause for celebration by the defendants. In the...
How To Win Friends
Posted on May 31, 2009My most recent post last Thursday evening (no longer online) hyperlinked to, and quoted from, a story in National Mortgage News. The next day, while traveling without access to my e-mail, I received an e-mail from some jerk who claimed...
Lock 'Em Up & Throw Away The Key
Posted on May 28, 2009Texas, the state that leads the nation in the number of executions each year and also the state that appears to lock up a disturbing number of innocent men, now appears to be shooting for the status of the number...
Cleveland Reeks: Part Deux
Posted on May 27, 2009Last January, when I referred to the city of Cleveland, Ohio as a "steaming heap of bat guano," I misspoke. The pile isn't "steaming," it's merely smoking. It's the mayor of Cleveland, Frank Jackson, who's steaming, most recently over a...
Pushing Papaer To No Purpose
Posted on May 26, 2009Housing Wire today ran a story that discloses additional evidence that the federal government's push to modify loans as a means to keep borrowers in their homes and, eventually, stop the downward spiral of housing prices, is working as well...
Pushing Paper To No Purpose
Posted on May 26, 2009Housing Wire today ran a story that discloses additional evidence that the federal government's push to modify loans as a means to keep borrowers in their homes and, eventually, stop the downward spiral of housing prices, is working as well...
So You Thought Being A Bank Director Was An Honor?
Posted on May 25, 2009For the past year or so, Georgia has been a hot bed of failed banks. According to an "unnamed source" within the FDIC, it's about to become the bulls-eye of FDIC target practice that seeks to score big returns to...
It's All About Leverage
Posted on May 21, 2009The problems that many smaller (and even some bigger) banks have in obtaining meaningful protection in contracts with third-party technology service providers is one near to my heart. The Tech Law Guy, Tom Hall, put up a post yesterday that...
Dodd, Payday Lending, and Credit Card "Deadbeats"
Posted on May 20, 2009Chris Dodd received kudos from consumer advocates for pushing the recent credit card reform bill through the Senate. After taking his bows, though, he must have heard the plaintive cry of his empty wallet, a cry that soon turned to...
More Stress In Store For Community Banks
Posted on May 19, 2009FinCriAdvisor claims that's what's good for the Big 19 will be great for the rest of the pack, or at least that's what they claim the federal banking regulators think. Banks nationwide should brace for a perfect storm of harsher...
Are State AGs Getting Ready To Dogpile Subprime Securitizers?
Posted on May 18, 2009A recent piece of litigation (an investigation actually, but it would likely have ripened into litigation) that settled last week seems to me to be indicative of what suits may come. A the settlement agreement entered into by Goldman Sachs...
Geithner's Growing Nose and Flammable Pants
Posted on May 17, 2009It's telling that so many observers are reacting with increasingly unbridled cynicism to every word that comes out of the mouth of Pinochio Tim Geithner. Last week's guffaw-inducer was the statement that the CPP investments that are paid back by...
Shameless Shilling
Posted on May 14, 2009I?m giving a one-hour webinar on May 28, 2009 from 12 pm to 1 pm Eastern Time on the legal risks to banks of using social media. It?s entitled ?Banks and Social Media: De-risking the Legal Risk? and is hosted...
Get On With It
Posted on May 13, 2009Private enterprise keeps trying to make a free market system work and the federal government continues to thwart such efforts through the operation of the law of life that states that if the road to hell is paved with good...
Elizabeth Warren: Back Stabbing PPIP
Posted on May 12, 2009When I stated last month that I got a kick out of Elizabeth Warren, the Harvard professor who's head of the Congressional Oversight Panel that oversees the Treasury Department's bailout programs, I should have qualified that by adding "up to...
The "Ideal/Idol" Supreme Court Justice
Posted on May 11, 2009Two Lawyers in a Pod[cast] consider who should replace Justice Souter on the U.S. Supreme Court when he retires after the end of the current term, and offer up a candidate that at first glance might not seem quite as...
Equity Derivatives: A Book Review
Posted on May 10, 2009In the five years I've been inflicting this blog upon an unwilling world, I've been asked a number of times to review books. Each time, I've refused, for a variety of reasons, most of them having to do with time,...
Watch What You Tweet
Posted on May 07, 2009Corporate "Tweeters" are a new breed of marketer. Sometimes, being cutting edge is double-edged. A recent Wall Street Journal article demonstrates how being tech-savvy doesn't mean that you're necessarily compliance-savvy. An eBay Inc. effort to broaden communication through the popular...
Safe Harbor = Trial Lawyers' Relief Act
Posted on May 06, 2009The Senate passed S 896 today which, among other things, would protect loan servicers from lawsuits by investors if the servicers modify or refinance loans to borrowers under one of the thus-far unsuccessful federal loan modification loan programs, such as...
Feds Make TARP Fly Paper Stickier
Posted on May 05, 2009Late this afternoon, The Wall Street Journal reported that one of the conditions that the federal government will place on banks that have taken a TARP CPP investment and who want to repay the investment will be to prove that...
As Always, It's Who You Know, Not What You Know
Posted on May 04, 2009FinCri Advisor released a study today that reveals either an amazing coincidence or further proof that the awarding of TARP CPP money is a process subject to the same influence-peddling as just about any other federal government program that doles...
Dick Durbin Derailed--Again
Posted on May 03, 2009Depending on which side of the political spectrum you inhabit, last week's destruction of Senator Dick Durbin's amendment to allow bankruptcy judges to cram down the value of residential real estate loans to the fair market value of the collateral...
An Infinite Number of Monkeys
Posted on April 30, 2009The Nanny State of Ohio won't quit until loan sharks make a big comeback, the kind of comeback that might lead Tony Sprano to come out of retirement. Last month, we noted that the attempt of the Ohio legislature in...
Total Recall
Posted on April 29, 2009I was going to post about something to do with banks and/or law and/or lawyers tonight, but following hard on the heels of President Obama's press conference this evening was the following brief announcement by the US Treasury Department that...
The Devil's Advocates and a Leap of Faith
Posted on April 28, 2009In what may be great examples of Supreme Court Justices playing head games with advocates, in today's oral arguments over the OCC preemption case we discussed yeasterday, Justice Ginsburg seemed to question the OCC's position and Chief Justice Roberts seemed...
National Bank Preemption: The Never-Ending Battle
Posted on April 27, 2009As the contestants gear up for tomorrow's Supreme Court arguments in the latest round of the OCC versus the states on the federal preemption of state law as it applies to national banks, the trade press is abuzz with speculation...
Social Media Marketing Legal Risk: The Bark Is Worse Than The Bite
Posted on April 26, 2009I spent a good portion of last Thursday in Las Vegas among bank marketing professionals and, as hard as it might be for some readers to believe, I found the experience refreshing. Perhaps because of what they do, but more...
A Short Break
Posted on April 21, 2009I'm on a combined business/vacation trip for the rest of the week. I'm speaking in Las Vegas on Thursday morning to a group of bank marketing professionals about the legal risks of banks using social media to market their wares....
If You Couldn't Laugh, You'd Have To Cry
Posted on April 20, 2009Elizabeth Warren, a Harvard law professor, bankruptcy expert, and blogger, is someone I've previously criticized for being a bit "breathless" when it comes to criticizing big, bad banks and their nefarious, consumer-hating ways. On the other hand, as head of...
Procrastination Is Costly
Posted on April 19, 2009I was out of town on Good Friday, when New Frontier Bank in Greeley, Colorado was taken down (paid subscription required) by the FDIC (at the request of the Colorado Banking Commissioner). I'll spare you the quips about "good" being...
Dipping Into The Mailbag
Posted on April 16, 2009It's time to answer a couple of e-mails, publicly, if semi-anonymously. One reader, responding to my use of the phrase "TARP's a tar baby," asked me if I'd ever thought of calling it a "TARP baby." No, but Jamie Dimon...
Foreclosure Freezes Failure
Posted on April 15, 2009Housing Wire's Paul Jackson has been adamant for some time about the utter uselessness of foreclosure moratorium laws in doing anything other than delaying the inevitable for borrowers and in increasing ultimate losses to servicers and lenders. Last December, we...
Repaying TARP Capital: Not So Fast
Posted on April 14, 2009A recent post to FinCriAdvisor (free registration required) gives some interesting insight on what we've previously described as the TARP Tar Baby: the difficult process of repaying TARP CPP investments to the U.S. Treasury Department. Get ready to prove to...
Stunned By Reality
Posted on April 13, 2009There is more stupidity around than hydrogen and it has longer shelf life. ---Frank Zappa Not long ago, a banker told me that one of the many problems with federal intervention in the country's residential mortgage markets was that none...
Blogging To Distractions
Posted on April 08, 2009Due to holiday travel, this blog will be off the air until next week. Before I head out, I want to clean one item out of the "to blog on" box before I take off for parts unknown. I received...
Spreading The Love, And Paying It Back
Posted on April 07, 2009It's only $15 million (and another $100,000 in "change"), but when it comes to returning TARP CPP money, every little bit helps. It also sends another message to Congress and "The Change" that their getting what Barney Frank asked for:...
Putting Reverse Spin On TARP Marketing
Posted on April 06, 2009One small bank has taken a lesson from recent snarky marketing campaigns by other banks that didn't take TARP preferred stock investments through the US Treasury Department's Capital Purchase Program and have been playing on the public's anger over "bank...
FDIC Torpedoes A Bank's Reacpitalization?
Posted on April 05, 2009There's a community bank in Greeley, Colorado that appears to be on its last legs. Bank traffic was heavy Friday afternoon amid continued rumors that regulators had planned a takeover. No such takeover occurred, although some customers remained worried...
KPMG: Stomped By The Elephant
Posted on April 02, 2009Yesterday?s news that the trustee in bankruptcy for former subrime mortgage giant New Century (one of the first big subprime lenders to fail a couple of years ago) had sued KPMG and its international parent over the collapse of New...
I'm Honestly Shocked
Posted on April 01, 2009The steady stream of complaints about banks sitting on their money and not making loans to credit-worthy borrowers was temporarily dammed up recently by a diverting report out of Kansas City, Missouri. It appears that in some cases, banks are...
TARP Free And Proud Of It
Posted on March 31, 2009Four banks, led by Iberiabank Corp, were first out of the gate today to announce that they'd paid back their TARP CPP investments. The four repaid the US Treasury over $338 million to redeem referred stock and warrants, and also...
Earlier this month, we headlined
Posted on March 30, 2009Earlier this month, we headlined a post about the backdating scandal at IndyMac, "As Bad As It Gets." We were just kidding. It gets worse (paid subscription required). The Treasury Department's inspector general is investigating whether regulators allowed the backdating...
OTS Backdating Scandal: From Bad To Worse
Posted on March 30, 2009Earlier this month, we headlined a post about the backdating scandal at IndyMac, "As Bad As It Gets." We were just kidding. It gets worse (paid subscription required). The Treasury Department's inspector general is investigating whether regulators allowed the backdating...
More Of The Same Old Sleaze
Posted on March 26, 2009We once thought that Clinton appointee Franklin Raines had a sweet deal at Fannie Mae (even though he had to--kind of--sort of--pay back a wad of his "compensation"). On a per-hour basis, Franklin had nothing on current White House Chief...
A Regulator's "Kumbaya Moment"
Posted on March 25, 2009At a Congressional hearing today (paid subscription required), federal bank regulators reluctantly confirmed what we (and many bankers) have been complaining about for months (most recently, here and here): bank regulators are sending conflicting signals to banks about lending...
Where There's A Will, There's A Way
Posted on March 24, 2009An article by Cheyenne Hopkins in today's American Banker (paid subscription required) nicely outlines the immediate reactions of many banking lawyers and consultants to the toxic asset and loan purchase plans announced yesterday by the Treasury Department...
CRA Extension: Let's Focus On The Real Issues
Posted on March 22, 2009We're waiting on pins and needles for the details of the next great idea for disposing of toxic assets on the balance sheets of big banks by enticing private investors to participate in working out those assets with a government...
TARP Derangement Syndrome
Posted on March 19, 2009The successor to "Bush Derangement Syndrome" among the chattering and political classes might soon be "TARP Derangement Syndrome." With the House and the Senate rushing through punitive legislation to punish bonus recipients at AIG, and in the process scooping up...
Creative Coercion Curtailed
Posted on March 18, 2009Cindy Cooper got her head handed to her last week in Buffalo. Whether she'll shuffle off, dry up and blow away is anyone's guess. If she comes back for more, I'm assuming that the judge will hand her not only...
The Wheel Will Turn
Posted on March 17, 2009Sen. Charles Grassley is playing a deadly game. I never believed for an instant that he was literally advocating that AIG executives commit suicide. However, there's no question that he's playing on the public's anger, riding it like Laird Hamilton...
Take My TARP...Please
Posted on March 16, 2009TCF CEO Bill Cooper is mad as hell, and he's not going to take it anymore. The man who recently told the Treasury Department that he's got a bad case of seller's remorse and wants to give back his bank's...
Maxine Waters: Ethically Challenged
Posted on March 15, 2009In a big lake filled with enormous, intellectually dishonest bottom feeders, California Rep. Maxine Waters sucks up more detritus than most, and spews forth the most ridiculous garbage with every exhale. In December, she openly thumbed her nose at House...
Rolling Down The Road To Perdition With Barack & Co.
Posted on March 12, 2009To many readers, this story is merely a routine business transaction between two banks. A New Mexico-based bank sells its Colorado branches to a bank with a larger footprint in Colorado. The seller nets a nice little premium (5.8%) for...
The Free Market Baffles Ohio Legislature
Posted on March 11, 2009Last May, I wrote about the Ohio law that, the legislature intended, would put the screws to payday lenders in that state. The law limited payday loans to four short-term loans a year and capped annual interest rates at 28...
Not With A Bang, But With A Whimper
Posted on March 10, 2009It's only two years late, but the National Association of Realtors President's confident prediction that Congress would enact a permanent ban on national banks exercising real estate brokerage powers "by the end of this year" has finally come to pass...
Belaboring The Obvious
Posted on March 09, 2009Once more, unfortunately, it's time to repost this, from three years ago:It also states in my Disclaimer that "[n]othing on this blog is intended to be a solicitation of, or the provision of, legal advice, nor to create an attorney-client...
A Brave New World
Posted on March 08, 2009US Banker announces that for financial institutions, the "Age of Re-regulation is nigh." The news is unsurprising, given the regulatory failures that have been evident for some time, especially with respect to Wall Street institutions. Nevertheless, its advent has got...
Bankruptcy Laterals Bringing In Big Bucks
Posted on February 25, 2009Today's Law Blog touts the big bucks bankruptcy lawyers are pulling in. While big law is laying off corporate lawyers, bankruptcy is back in vogue and paying serious money to partners with skills and (we assume) portable business who can...
Good Banks-Bad Banks
Posted on February 24, 2009Minnesota's senior (and until the Franken-Coleman contest is resolved, only) US Senator, Amy Klobuchar, stepped away from some of her more notorious bank-bashing brethren and wrote an editorial published in today's The Washington Post that offers the startling opinion that...
Under Their Thumb
Posted on February 23, 2009This weekend, the talking heads on the Sunday morning news shows were in full bleat about how the federal government must "nationalize" (only temporarily, of course) some of the biggest, most troubled banks, in the manner of Sweden, so that...
Save The Economy, Screw The Poor
Posted on February 22, 2009The Austin-Statesman points out one of the many unintended consequences of federal government's deft management of monetary policy: the diminishing funding for legal services for the poor.Rock-bottom interest rates, part of the Federal Reserve's attempt to prop up a crumbling...
Wilbur Ross: Home Loan Modification Program Falls Short
Posted on February 19, 2009Bazllionaire Wilbur Ross, a man who's made a big play on mortgage servicing rights and who's waiting until the US government ":gets real" on the terms it offers to private investors before he jumps into the bailout of broken financial...
Texas Tarp Ad War Takes Its Toll
Posted on February 18, 2009Last week, we discussed a nasty little public advertising campaign being waged by a couple of Texas banks that didn't take TARP CPP money against those who did. At the time, I thought that while most customers wouldn't be influenced...
Gosh Darn It, TARP Sucks
Posted on February 17, 2009If you listened to the more politic utterances of big bank CEOs lately about TARP you might think that banking giants were in lockstep about their love for Big Government handouts. Luckily for those of us at Bank Lawyer's Blog,...
Regulators to Banks: We Want You To Lend, But...
Posted on February 16, 2009Last month, real estate columnist Steve Brown shot off a nice little rant about how bank regulators were forcing banks to clamp down so hard on real estate lending that they were denying credit to good borrowers as well as...
Chipping Away At Preemption
Posted on February 15, 2009A recent action that received little coverage (other than by BankThink) was the request by Consumers Union that The Treasury Department order the OCC to rescind its preemption regulation. Consumers Union is trying to win the case of Cuomo v....
Deep Thoughts, Vol. II
Posted on February 12, 2009Last fall, theology professor R.R. Reno wrote a long blog piece at First Things that defended the federal government's bailout from the attacks of his more ideologically pure brethren on the right. Professor Reno recently came back with a follow...
What's Good For The Sharks Is Good For America
Posted on February 11, 2009A couple of weeks ago, I said that I thought the plaintiffs' attorneys in the recently settled class action litigation against the Veterans Administration over the theft of a lap top computer would "make millions." Yesterday, The Washington Post reported...
Bizzaro Marketing 101
Posted on February 10, 2009Is it so wrong to expect that FHA loan fraud detection ads that mimic Mystery Science Theater 3000 actually be amusing? I guess the old adage still applies: any publicity is good publicity.This YouTube marketing video was forwarded to me...
Colorado Gets Its Piece of Countrywide's Hide
Posted on February 09, 2009Colorado Attorney General John Suthers, a Republican, held a press conference today to promote himself announce a settlement with every politician's favorite mortgage lending punching bag, Countrywide. The State of Colorado had sued Countrywide over its marketing practices of subprime...
Anti-TARP Marketing: Fair Or Unfair?
Posted on February 08, 2009In the Dallas/Fort Worth "Metroplex," some banks are using the fact that they haven't taken TARP money and their competitors have as fodder for Texas-sized sniping.Rivalry between normally polite banks is getting down, dirty and very public with some using...
Blue-Eyed Soul Raps The Bailout
Posted on February 05, 2009Reader Gregg Somervile, a stockbroker, sent me a link to his "rapumentary" ripping Hank Paulson. It may be a few months behind the curve at this point, but it remains hilarious. The line about Richard Fuld being the only guy...
Bank Lawyers' Advice About TARP: Don't Walk Away, Run!
Posted on February 04, 2009A few days ago, we posted about the increasing number of community banks that had been approved for capital investments through the TARP CPP program, but that had decided to pass on taking the capital. Today, Law.com discussed one of...
No Good Deed Goes Unpunished
Posted on February 03, 2009In thrall to their politically correct masters, those entities formerly known as Freddie Mac and Fannie Mae (now simply referred to as Mary-KateandAshley) have adopted consumer-friendly policies that may be at odds with their interest in not only self-preservation (although...
Drive-by Blogging
Posted on February 02, 2009This has been a long, long day and there's a Shiner Bock with my name on it waiting in the icebox, so here are just a couple of "quick hits": I received an e-mail today from an attorney with a...
Bailing Out On The Bailout
Posted on February 01, 2009Yesterday's The Wall Street Journal documented the most detailed evidence to date that many community banks who don't need the government's TARP money are backing away from participating in the Capital Purchase Program, primarily because their "fear of the unknown"...
Calling All Investors
Posted on January 29, 2009The American Banker had an interesting article the other day (paid subscription required) about the private investors who the FDIC and other federal bank regulators are attempting to entice into making investments in banks and thrifts in need of cold,...
PTSD Damages For A Non-Event
Posted on January 28, 2009Two and one-half years ago, then-VA Administrator Jim Nicholson asked Congress for emergency funding of not less $160.5 million "for credit counseling and other measures to protect veterans and military troops whose sensitive personal information was stolen...
G-Mac Steps Up Its "Regifting" Of Bad Loans
Posted on January 27, 2009Freddie and Fannie aren't the only big loan investors who have been issuing massive loan "put backs" to their loan sellers. They've recently been joined by GMAC's Residential Funding Co., which, according to the Minneapolis/St. Paul Business Journal, "has nearly...
Spinning TARP With Just The Right Velocity
Posted on January 26, 2009A short article from Friday's St. Louis Business Journal crams a lot of viewpoints.The article deals with the TARP CPP program, and complains that only four St. Louis banks have received investments from the Treasury under the program. The article's....
Talking From Both Sides Of Their Mouths
Posted on January 25, 2009Steve Brown, the Real Estate editor of The Dallas Morning News, let loose a tirade on Friday directed at banks and their regulators over the "foreclosure flood" that is coming in commercial real estate.The whole spectrum of borrowers, ranging from...
Barney Goes To Bat For Baytown Bank: Big Deal
Posted on January 22, 2009I wish I could get as worked up about the page one story in today's Wall Street Journal as many others have done. I simply cannot. The entire process of picking winners and losers in the bank bailout game totally...
Data Breaches: On The Rise and Striking the Heartland
Posted on January 21, 2009While most honest citizens are recovering from the hangover induced by the Obama Inaugural Extravaganza, the few rotten apples in the barrel have been busy little bees. Last week, the WSJ reported that last year, businesses reported 656 data security...
Allegations of IndyMac's "Backdating": Worse Than We Thought?
Posted on January 20, 2009A colleague from the West Coast sent along this tidbit from ABC News that apparently documents the efforts of ABC News rodent reporter Brian Ross to chase an unsmiling and silent Darrell Dochow around the block a few times, after...
Preemption: High Tide?
Posted on January 19, 2009When we discussed the US Second Circuit Court of Appeal's decision in December 2007 to uphold the principle federal preemption of the authority of state regulatory authorities to enforce state laws on fair lending against national banks, it generated a...
The Dancing Bear Tires
Posted on January 16, 2009The Wall Street Journal broke a story today that, thus far, has been ignored by most of the rest of the main stream media. It's Friday and Bank of America's and Citigroup's woes dominate the banking stories. Yet, this one's...
Quick Hit Re: Accountability
Posted on January 15, 2009Tonight, I only have a brief moment to point you to an intriguing post by a young blogger who continues to intrigue me: Emily Flitter of BankThink. In her e-mails to me, she seems to take the position that she's...
Not Feelin' The De Novo Love
Posted on January 14, 2009For the sake of those trying to organize new banks, we wish we could say we've been surprised by this recent article from the newspaper itself (paid subscriptiton required) that confirmed what we recently speculated upon: the FDIC is putting...
FDIC Keeps IndyMac Buybacks "In-house"
Posted on January 13, 2009Last week's rank speculation reasonable assumption that the FDIC as receiver of the late, great IndyMac retained the liability for buyback demands made by Fannie Mae was confirmed Sunday by the New York Post ( a bastion of responsible reporting,...
Make Work
Posted on January 12, 2009Last week, banking expert Bert Ely argued persuasively why banks should not be pushed into using TARP dollars to throw good money after bad. He urged, instead, that banks put capital to work where it best served the survival of...
Bair Stays In Her Lair
Posted on January 11, 2009It's amusing, and very fitting, that Barney Frank is the elected official who publicly confirms that, indeed, Barak Obama's kind words for Sheila Bair mean that she's in at the FDIC for as long as she wants to be, or...
Cramdown's A'Comin'
Posted on January 08, 2009To no one's surprise, (certainly not ours), first lien residential mortgage loan cramdowns will soon be coming to a bankruptcy court near you. Although we haven't seen the bill yet, Dick Durbin's office announced today that he, Chuck ("Bank Run")...
Mad For Loan Mods
Posted on January 07, 2009Although often berated as a prime example of the "Liberal Main Stream Media" that conservative radio talk show hosts love to loathe, the latest issue of Time magazine sang the praises of a company that's often been labeled as one...
Lending Mandates A Bad Idea
Posted on January 06, 2009Noted banking expert and popular popper of gas balloons, Bert Ely, weighed in on the issue of banks not using TARP money to make loans, with an opinion piece published in the most recent edition of The Wall Street Journal....
Hard To Pick A Favorite
Posted on January 05, 2009Shortly before New Years Day, Housing Wire broke the story that the FDIC's negotiations to sell most of IndyMac to a consortium of Wall Street sharks private equity funds was being held up by mortgage loan buyback demands made by...
Bailing Out Some Banks But No Borrowers?
Posted on January 04, 2009Today's Dallas Morning News contained an article whose headline was less than stunning: "Banks might use bailout funds for acquisitions." Someone needs to notify the News that banks have already used bailout funds for acquisitions. Ask the former National City...
Pause...Then Resume
Posted on December 24, 2008I'm taking a break for the holidays. Even snark, second-guessing, and general insensitivity needs to be renewed during this time of year. Perhaps I'll return next year with an inviting, open, accepting, post-modern personality, and revel in the diversity of...
Bailout Comes To Mainstreet
Posted on December 23, 2008Emily Flitter brings us the inspiring story of an average homeowner,Thomas Haberson, who's had enough of the big banks getting all the bailout bucks. He's filed a handwritten complaint against the US Treasury Department in an Arizona court that seeks...
IndyMac Fun Continues For OTS
Posted on December 22, 2008When in early October, I discussed the spreading stain of criticism over the OTS's former Western Regional Director Darrell Dochow and his alleged mishandling of busted federal savings bank IndyMac, I warned that the drumbeat would get louder and louder...
Delaying The Inevitable
Posted on December 21, 2008Housing Wire recently posted further evidence that the various state foreclosure moratorium laws are not achieving their goal of forcing lenders to modify loans with borrowers who are substantially delinquent.It appears that California is now following in the footsteps of...
FDIC Saying "Nyet" To New Charters?
Posted on December 17, 2008Although the FDIC denies it, organizers and consultants who are trying to start new banks in certain areas of the country allege that the FDIC has put in place a "de facto ban" on all new bank charters.?It is a...
FDIC Saying Nyet To New Charters?
Posted on December 17, 2008Although the FDIC denies it, organizers and consultants who are trying to start new banks in certain areas of the country allege that the FDIC has put in place a de facto ban on all new bank charters.???It is a...
Workin' It Out With Waters
Posted on December 16, 2008Not to be outdone by Sheila ("Mama Bear") Bair in the race for the title of 2008's "Loan Mod Madam," California Representative Maxine Waters has not only stuck her toe in the loan modification water, according to an article in...
Betsy On Bair
Posted on December 15, 2008Fortune senior editor Betsy Morris has a girl crush on Sheila Bair, and boy, has Betsy got it bad!Sheila Bair may now be a lightning rod, but at least she's finally getting some respect. For months, her agenda was a...
Too Dumb To Borrow?
Posted on December 14, 2008For decades, there's been a split between those who think that consumers should be free to make informed decisions about credit, good or bad, as long as they have available to them the relevant information to make such informed decisions....
Stamping Out Equity Stripping In Texas
Posted on December 11, 2008If we can bash Texas Attorney General Greg Abbott when he grandstands publicly to no practical purpose other than advancing his political career, we can give him his "props" when he grandstands to advance his political career and incidentally screws....
Litigators, Line Up Your Experts!
Posted on December 10, 2008Well-known legal social media guru Robert Ambrogi authored an article in the latest Bullseye Newsletter entitled "Legal Tsunami Is Coming, Batten Down The Experts."As James J. Angel, associate professor of finance at the McDonough School of Business at Georgetown University...
TARP: All It's Cracked Up To Be
Posted on December 09, 2008You knew this was coming. So did I, but I wouldn't face it and neither would you. Well, people with more courage than you or me have been looking the concept of "logical consequences" straight in the eye and, unflinchingly,...
I'm Surprsied That You're Surprised
Posted on December 08, 2008When I read Comptroller Dugan's remarks this morning about the rate of default "recidivism" by residential mortgage borrowers whose loans have been modified, my initial reaction was the same as Paul Jackson's of Housing Wire. Dugan had this to say...
I'm Surprised That You're Surprised
Posted on December 08, 2008When I read Comptroller Dugan's remarks this morning about the rate of default recidivism by residential mortgage borrowers whose loans have been modified, my initial reaction was the same as Paul Jackson's of Housing Wire. Dugan had this to say...
Misdirected Criticism Of CRA
Posted on December 07, 2008In yet another sign of the Apocalypse, Sheila Bair and I agree on something. Last Thursday, speaking before a consumer advocacy group (her favorite turf, other than any Congressional subcommittee chaired by Barney Frank), Ms. Bair "vigorously" refuted the allegation...
Easy Come, Easy Go
Posted on December 04, 2008Vanity Fair's take on an application form for some of that yummy bailout cash from he Treasury Department (h/t Bruce Carton).
Bair, Busy Bussing Barack's Behind, Berates Bush's Boyz
Posted on December 03, 2008Sheila Bair must be feeling pretty cocky lately. Her public dissing of the lame duck administration and her fawning over the incoming administration is becoming so transparent that she might soon be invited to a quail hunt with Dick Cheney....
A Rush To Capital Or Off A Cliff?
Posted on December 02, 2008What a difference a stock market crash makes. According to a recent poll of community banks, in October, 66% did not intend to participate in the US Treasury's Capital Purchase Program. Like San Antonio, Texas-based Frost Bank, most community banks...
Angels Fly
Posted on December 01, 2008Angels fly because they take themselves lightly.---G.K. ChestertonThis was an exhausting and long day, spent at a local heart hospital where the love of my life is undergoing surgery. I arrived home tonight, and thought, in passing, I'd see if...
Employees: The Chink In The Armor Of Information Security
Posted on November 30, 2008Last May, we profiled the risk of rogue sociopathic employees who help outsiders steal sensitive data from banks, mortgage lenders, and other businesses. In that story, former employees disclosed passwords that were not changed after the employees left the business...
Pull The Turkey From The Lawyer's Butt And Win A New Job
Posted on November 26, 2008I didn't intend to post again until next week, but this story of dysfunctional telemarketing to a lawyer was just too good to pass up.This younger generation really has issues with rejection, eh?Technically, using a telephone to anonymously annoy or....
Don't Do DAP, Says HUD's "Top Cop"
Posted on November 26, 2008As Democrats in Congress gear up to push through the return of seller-funded downpayment assistance (DAP) for FHA loans in 2009, at least one "top cop" with plenty of skin in the game thinks that's a really bad idea. HUD's...
And You Thought YOU Were Having A Bad Day
Posted on November 25, 2008From Bruce Carton, editor of Securities Docket, via a "tweet" on Twitter (don't ask, Google it), comes word of one lawyer's nightmare of a day in court. If you're going to sue AIG in Justice Ramos's court, you'd better either...
What A Surprise!
Posted on November 24, 2008An article in the December 1 issue of The New Yorker entitled "Anatomy of a Meltdown" contained some interesting--some might say shocking--admissions by Ben Bernanke about how befuddled he was about the onset of the current financial crisis. Paul Jackson...
Congress Cries "Cram It!"
Posted on November 23, 2008Bankruptcy cram-down legislation for residential mortgages is back on the front burner. When we last looked at this proposal, its chances of enactment looked favorable, but it was stripped out of the legislation to which it had been appended prior...
Rocky Mountain Whack-A-Mole
Posted on November 19, 2008While privately-held banks (other than Subchapter S and mutuals) scramble to sort out the CPP and decide, in short order, "to be or not to be" in bed with Uncle Sam, other participants in the mortgage market continue to prey...
Go Sheila, Go Sheila! Uh-Huh, Uh-Huh!
Posted on November 18, 2008While FDIC Chairman Sheila Bair may give many of us in the private sector a bad case of shingles, within the FDIC she's hotter than a photo of a passionate lip-lock between Britney Spears and Lindsay Lohan. At least, that's...
Pushback on Freddie Mac Buybacks?
Posted on November 17, 2008Funny thing about elephant stampedes. A herd of pachyderms might be stomping villages flat, driving the terrified villagers before it, and generally scaring the stuffing out of every mortal man and woman that crosses its path. Suddenly, the rampaging tuskers...
Row, Row, Row Your Boat
Posted on November 16, 2008While most eyes are focused on the FUBAR named "TARP," those of us who inhabit the rabbit warren known as "Bank Lawyer???s Blog" have been head-snapping at less-noticed events that we think might provide "signs-of-the-times" markers for the tea-leaf reader...
Clowns To The Left Of Me, Jokers To The Right
Posted on November 13, 2008It's been a tough couple of days, and the end of the week promises to be no less frantic. What is it with clients and deadlines? Don't they understand that blogging comes first? Where are their priorities?Not that I wouldn't...
For Whom The Toll Bells
Posted on November 11, 2008Erin Toll, a BLB fave, is back in the trade news again, and, as might be expected, it's not because she's shilling for businesses. Ms. Toll, the Director of Real Estate for the State of Colorado, was last seen running...
I've Looked At Work From Both Sides Now
Posted on November 10, 2008The headline of this article from Saturday's The Washington Post is enough to make most of the American public "hurl": Wall Street Decamps to K Street for Work on Bailout. The details about "an army of accountants, financial advisers, asset...
Ex Post Facto Right to Redo
Posted on November 09, 2008Ballard Spahr issued a client alert last Thursday that pointed out to those who might take part in the Treasury Department's Capital Purchase Program under TARP that there is a very disturbing provision in the Securities Purchase Agreement that Treasury...
The Good News
Posted on November 06, 2008There was great news today for two of Bank Lawyer's Blog's favorite public servants. First, Eliot (Mess) Spitzer beat the rap on a Mann Act violation, not because he didn't violate the Mann Act, but because the "Justice" Department says...
This Is The Change We Have Been Waiting For
Posted on November 05, 2008Everyone: can we all chant in unison, "Yes, We Can!"? We can? Cool!I'm not talking about Barack Obama, I'm talking about a federally-mandated 90-day foreclosure moratorium. The kind being pushed by Chris Dodd. The kind already enacted in California and...
Is Hope For Homeowners Hopeless?
Posted on November 04, 2008Peter Miller of FHA Mortgage Guide thinks that "it's a disgrace" that the FHA's Hope for Homeowners program has thus far proved to be a flop. Well, not merely one of those routine flops, the kind that hits the ground...
The Bailout's "Pacman Effect"
Posted on November 03, 2008In response to carping by Barney Frank, Chuck Schumer, and a host of others about banks who receive capital infusions from the US Treasury and then use the capital for purposes other than lending (such as the acquisition of other...
The Never-Ending Rewrite
Posted on November 02, 2008I realize that the tin foil hat wearing Dennis Kucinich had yet to open his mouth to let the moonbats fly out when Texas-based Frost Bank announced last week that it would not participate in the federal government's handout of...
Thanks, But No Thanks
Posted on October 31, 2008In what might very well turn out to be an extremely smart move, Texas-based Frost bank tells the US Treasury Department that it will pass on the handouts.The parent company of Frost Bank won?t attempt to get a piece of...
Caveat Emptor
Posted on October 29, 2008For those who are hot to get in line to buy from the US government bad assets that the government will buy from banks and sell back to private investors, former Arnold & Porter partner Edward Sisson has some advice:...
Red Flags In Place?
Posted on October 28, 2008Occasionally, I like to point those readers who are in-house counsel or private practitioners and who represent financial institutions to a useful publication that's available on-line from another law firm. Ordinarily, I'd make a snarky, self-deprecating comment at this point;...
The Wacky World of Bank Law Blogging
Posted on October 27, 2008Every once in awhile, I have to step back and wonder whether the creative (and often, emotional) release of spending an hour a day pounding out semi-snarky blog posts instead of ogling scantily-clad female hoofers on "Dancing With The Stars"...
To Every Day, Spin, Spin, Spin
Posted on October 26, 2008I recently asked a friend of mine, a D.C. "insider" at one of the national law firms who's one of the "go to" guys when the American Banker or another trade rag needs a quick quote for the latest breathless...
Feel My French Fist of Fury, Hacker-Pig!
Posted on October 23, 2008From Monty Python and the Holy Grail:King Arthur: Go and tell your master that we have been charged by God with a sacred quest. If he will give us food and shelter for the night, he can join us in...
Look At Me, Ma! I Gotta Brand New Practice Group!
Posted on October 22, 2008While the world teeters on the precipice of financial ruin, the legal profession-at least in the good old U.S. of A.-revs up its engine of avarice and guns for the finish line that all men of good will and charitable...
Barely Bair-able Backstabbing
Posted on October 21, 2008Via the San Antonio Business Journal come excerpts from an affidavit filed in the litigation between Wachovia and Citigroup over the failed attempt by Citi to take Wachovia off the outstretched hands of the FDIC, excerpts that show what we...
Bailout Recapitalization Program: Will It Be Boom Or Bust?
Posted on October 20, 2008It's funny how your perspective changes, depending on whether you're on the inside looking out or on the outside looking in.Today, Secretary of the Treasury Henry Paulson claimed that banks from all sides were beating down his door to get...
Countrywide Condemned For Blacklisting...Again
Posted on October 19, 2008The hits just keep on comin' for Countrywide, don't they?A group of appraisers in Idaho filed a class-action lawsuit Thursday against Countrywide Financial Corp. ??? Now, Bank of America Corp..., after its recent acquisition ??? claiming the company used ???strong-arming...
Blessed Are The Lawyers
Posted on October 16, 2008We've previously yapped about all the litigation generated by the subprime mortgage meltdown, and how trial lawyers are in a feeding frenzy as a result. Now it appears that law firms, especially the large ones, are gearing up for yet...
More Moronic Moratorium Maneuvering
Posted on October 15, 2008Chris Dodd is on board with his feckless leader in calling for a federally-mandated 90-day foreclosure moratorium. Dodd spoke at the annual conference of the Connecticut Housing Coalition in Hartford. He said people facing foreclosure deserve a time-out from the...
No Honor Among Thieves
Posted on October 14, 2008As the litigation between Citigroup, Wachovia and Wells Fargo drones on, it has become clear that Section 126(c) of the recently passed Emergency Economic Stabilization Act of 2008 is going to present a substantial obstacle to Citigroup's recovering jack squat,...
The Grim Reaper Continues His Harvest
Posted on October 13, 2008Last Friday, while many bankers were hightailing it to the hinterlands for one of those three-day weekends that everyone loves to "gig" bankers (and government workers) about, the FDIC was busy behind the scenes shutting down two more banks. They...
Phisermen Take Advantage Of Bank Mergers
Posted on October 09, 2008According to Ben Worthen at The Wall Street Journal's Business Technology Blog, the recent surge in bank mergers has been accompanied by a commensurate surge in "phishing" attacks by cybercrooks. If you want to see one way the mess on...
Community Banks On The Bailout: What's In It For Us?
Posted on October 09, 2008What I'm hearing from community bankers and their legal counsel is echoed by the following comment of William Dunkelberg, the Chief Economist for the National Federation of Independent Business, when asked what the recently-passed federal plan to buy toxic loans...
Kicking Around The OTS
Posted on October 08, 2008This public flogging is only the beginning (hat tip to a regular West Coast reader who prefers anonymity). The Los Angeles Times took off after Darrell Dochow, the Director of the Western Regional Office of the Office of Thrift Supervision,...
Yet More Wrinkles In The Wachovia Sale Litigation
Posted on October 07, 2008Can you imagine being an employee of Wachovia for the past week or two? How much work do you think is being accomplished, when employees don't know who's buying their bank, whether it will be a whole bank purchase or...
Deep Thoughts (And Not By Jack Handy)
Posted on October 06, 2008Of all the places you???d least expect to find some of the most cogent comments on the "bailout" legislation, perhaps the blog of the conservative Catholic magazine "First Things" might be the winner. Today, in a post entitled "A Car...
Double Take
Posted on October 05, 2008Many of us who practice banking law had a "WTF?" moment Friday morning when we read that Wachovia had spurned what was announced as a done deal to sell itself (or, at least, its commercial bank) to Citigroup, and had...
No Matter How Hopeless, Fight On
Posted on October 02, 2008The opponents of tax anticipation loans are not giving up their fight (paid subscription required) to restrict those loans, notwithstanding the recent ruling of the US Sixth Circuit Court of Appeals that held that state laws that limit tax preparers....
OTS: The End of Days?
Posted on October 01, 200828 months ago, when Wachovia bought Golden West Financial, many predicted that if Wachovia dumped the thrift charter, the OTS would soon be out of business. I thought at the time that Wachovia would keep the thrift charter and they...
The Burn/Fiddle Conundrum
Posted on September 30, 2008The Democrats planned to fiddle while Rome burned. The Republicans were going to burn Rome, then fiddle.--P.J. O'Rourke, Parliament of Whores. A friend of mine is an ex-US bank regulator who was heavily involved in the resolution of the thrift...
The Eternal Lessons of the Current Credit Crisis
Posted on September 29, 2008There was an interesting juxtaposition of articles in yesterday's Dallas Morning News. Business columnistCheryl Hall worried that the latest bailout might make the same :mistake" that she alleges the RTC made: selling assets at too low a price, and allowing...
The Beating Goes On (and on and on and on...)
Posted on September 28, 2008Unfortunately, it's time to post this again: I used to have post this only once every six-to-twelve months. Now, it appears I'll have to do it every three-to-four months. Eventually, I'll have to do it weekly. The deluge of requests...
No Mas Hate-for-Sale!
Posted on September 25, 2008While many of us thumb-suckers have been spewing spittle all over our keyboards about the "nucular" disaster scenario of a constipated financial system bursting a bowel, a far more dangerous economic meltdown has been relegated to the back pages. Thank...
The No Longer Preferred Preferred Stock
Posted on September 24, 2008Lately, there's been whining and sniveling from some corners of the commercial banking sector about the write down of Freddie Mac and Fannie Mae preferred stock as a result of the federal takeover of those political contribution ATMs stalwarts of...
A Small Distraction
Posted on September 23, 2008Those who complain of the slow pace of national bank regulators to deal with problem institutions they regulate have been slow to react to the FDIC's seizure of Ameribank, Inc. of Norfolk, West Virginia last Friday. Perhaps they were distracted...
Glass-Steagall: Buh-Bye!
Posted on September 22, 2008My initial reaction to the news that Goldman Sachs and Morgan Stanley are becoming bank holding companies mirrors the initial thoughts of The New York Times (perish the thought!). the leverage ratios of both investment banks will be drastically reduced,...
The Best And The Brightest
Posted on September 22, 2008The night before I left to cover the Iraq war I got drunk with another friend, who works in TV news. We were talking about how--as an approach to national security--invading Iraq was...different. I'd moved my family from Washington to...
Beneath The Bloviation
Posted on September 21, 2008While the blogosphere bloviates breathlessly about the U.S. Treasury Department's blatant grab for unbridled power, the likes of which has not seen since Julius Caesar crossed the Rubicon, some bank law nerds have been diverted by more mundane aspects of...
Any Hope for Hope for Homeowners?
Posted on September 18, 2008There are only two weeks to go until the event we've all been waiting for hits the mortgage world like Ike (the hurricane, not the dead president): The Hope for Homeowners Program. At yesterday's hearing before the House Financial Services...
Learning A New Trade
Posted on September 17, 2008Experienced bankruptcy attorneys must be rolling their eyes at this news from Market Watch. [Monday's] financial meltdown on Wall Street and the unprecedented bankruptcy filing of Lehman Brothers has had a ripple effect in the Continuing Legal Education arena...
Incentives? What Incentives?
Posted on September 16, 2008Depending on which way you roll with respect to our banking system, you may think US banks are the tools of Satan or are God's gift to"person-kind." Or, as some of you apparently do, you may think that they're simply...
The Silver Lining
Posted on September 15, 2008As those of us dumb enough to have money invested in stocks and/or stock mutual funds watch Wall Street lemmings swim out to sea to drown, other investors believe the time is right to start cherry-picking whatever flesh remains on...
Bank's Confidential Info "eBayed"
Posted on September 14, 2008It's one thing for Gov. Palin to try to sell the Alaskan state government's jet on E-Bay. It's quite another thing for your run-of-the-mill bank vendor to sell your personal information (including your banking information) through the same service. An...
Businesses Blow Off Information Security Breaches?
Posted on September 11, 2008The Wall Street Journal's Business Technology blog had an eye-opening post the other day about the rapid pace of data breaches, and, more surprising, the alleged reason for the increase in breaches. U.S. businesses reached an ignominious milestone in August,...
Bank Run Counterattack
Posted on September 10, 2008You have to hand it to The Onion. When the going gets tough, the tough go weird. Protecting Our Banks The Federal Deposit Insurance Corporation, the body that insures bank deposits up to $100,000, has raised the number of "troubled...
The Good, the Bad, and the Risky
Posted on September 09, 2008An article in The Wall Street Journal (paid subscription required) last month prompted some inquiries about the good bank-bad bank strategy from the good old-bad old days of the 1980s. James Dierberg, the 71-year-old chairman of First Banks Inc., is....
Wamu Settles Appraiser "Blacklist" Suit
Posted on September 08, 2008In January, California appraiser Jeniffer Wertz sued Washington Mutual, alleging that she was removed from Wamu's "preferred appraisers" list, allegedly because she refused to knuckle under to a Wamu sales manager's demand that she change a neighborhood value classification on...
The Bozo Factor
Posted on June 12, 2008Twenty plus years ago, I had been recruited by a large law firm as a lateral hire. At my first quarterly firm dinner, I was sitting next to an especially acerbic fellow lateral hire (and, therefore, one of my favorite...
HUD Resumes Fight To Delete DAP
Posted on June 10, 2008After carefully considering an adverse ruling by a federal district court judge over its failure to follow the procedures mandated by the Administrative Procedures Act, HUD has decided to thank the judge for outlining the course of action it now...
Remote Deposit Capture: Is Fraud Risk Remote?
Posted on June 09, 2008Over the past year, we've discussed the risks involved in remote deposit capture (most recently here) and that financial institution regulators expect banks that offer RDC to customers to examine, underwrite, and educate customers who use this service, in order...
Mike Bloomberg: Modern Day Beau Brummell
Posted on June 08, 2008When we last spied on stalked sent eight dozen long-stemmed red roses to discussed former New York Banking Superintendent Diana Taylor, her wounds had healed from having been gut shot by the NRA when she was proposed as the Chairman...
The Big 4 and Subprime: Pawprints Everywhere, But Not A Big Game Hunter In Sight
Posted on June 04, 2008Much ink has been spilled over the last few days about the settlement between the rating agencies and NY AG Andy ("Little Eliot") Cuomo. Francine McKenna of re: The Auditors asks "When Will They Call CR On Auditors Too?" By...
An Accord Of Skepticism
Posted on June 03, 2008It may be time to pull out the figure skates and do a "Hamill camel" in Hell: the editorial boards of The Washington Post and The Wall Street Journal agree on legislative policy. Well, not really, but at least they...
A Steeper Yield Curve May Not Matter
Posted on June 02, 2008The problem with public prognostications, especially by economists, is that some jerk memorializes the predictions and then waits a couple of years to remind everyone that the crystal ball must have been on the blink. In January 2006, the Mortgage...
The Limits of Literacy
Posted on June 01, 2008Recently, John Carey at Dealbreaker raised a subject that I also raised a few years ago and that, at the time, engendered some spittle-spewing outrage on some consumer financial advocacy blogs and message boards: the financial illiteracy of most Americans...
Stubby, We Hardly Knew Ye
Posted on May 30, 2008Luke Mullins of The Home Front tells the tragic tale of another victim of the foreclosure crisis that continues to plague this country like, well, a swarm of killer bees. The national foreclosure crisis has slashed home values, put families...
A Pause For Quite Reflection
Posted on May 29, 2008As I scramble to quench fires set by flamers engaged in tense negotiations over a technology outsourcing agreement and another situation that demands repeated redrafts and a cast iron gluteus maximus, I did want to pass along a couple of...
An Elephant Stampede
Posted on May 28, 2008Two and one-half years ago, we were talking about an "elephant in the room" for the mortgage banking business: loan repurchase obligations. In November 2005, the problem was primarily with respect to subprime mortgage loans. Today, according to The Wall...
We're All Doomed
Posted on May 27, 2008Last November we asked, "Will The Be A Bank Implode-O-Meter?" In January, we received our answer and it was "Yes." If you haven't checked it out, you should do so. Although commercial and investment bank failures haven't exactly skyrocketed and...
LendingTree Sued Over Security Breach
Posted on May 26, 2008The security breach at LendingTree that allowed former employees to help other mortgage lenders gain access to mortgage application information, which we discussed last month, has given rise to what may become a class action lawsuit against LendingTree...
Own To Rent
Posted on May 22, 2008When the going gets weird, the weird turn pro. ---Hunter S. Thompson Whenever pressure is applied to fragile minds, those minds tend to bend. The latest example of an idea that demands a reply of "get bent" is "Own To...
Staying "Bought"
Posted on May 21, 2008It's amusing to watch Senators Dodd and Shelby tout their special interest bailout plan as a clever means to get maybe half a million borrowers (and perhaps their lenders, even after the required "haircut," some relief from having to suffer...
Everything Old Is New Again
Posted on May 20, 2008FDIC Chairman Sheila Bair may have inadvertently displayed her lack of experience in the area in which she's supposed to be an expert by making a big deal last Friday about the use of brokered deposits to fuel rapid growth...
Ohio (Effectively) Bans Payday Lending
Posted on May 19, 2008Why are these men celebrating? We'll explain. Notwithstanding heavy-handed opposition from some corners of the payday lending industry, the Ohio legislature passed a bill that will, for all practical purposes, put payday lenders out of business in Ohio...
The Perfect Fit
Posted on May 18, 2008An excellent example of the proof of The Peter Principle: Former Ohio Attorney General Marc Dann spent his first day after resigning helping his wife with her business selling dishes online. Dann's attorney Mike Harshman says Dann helped his wife,...
Increase In Foreclosures=Increase In Crime?
Posted on May 15, 2008Not long ago, Pravda National Public Radio had a story on its "All Things Considered" afternoon show (to listen, follow this link) that discussed some of the aftershocks suffered by residents of California's "Inland Empire" due to the earthquake caused...
The Latest, If Not Greatest
Posted on May 14, 2008Updating a couple of stories we've been following: Marc Dann resigned today, proving that even someone devoid of shame can read the handwriting on the wall when it's spray painted on the wall with HUGE CAPITOL LETTERS. Ohio Democrats wanted...
Most Banks Behind The Curve On Social Media
Posted on May 13, 2008The folks at Social Media Today have posted a paper online entitled "Social Media and the Banking Industry" that contains some interesting findings and observations about the "new social media" and banks. First, and foremost, most banks don't "get it...
The Biggest Losers?
Posted on May 12, 2008Today's editorial page of The Wall Street Journal, in an editorial entitled "The Biggest Housing Losers," answers the question "Who let the dogs out?" The WSJ points its finger at the Elton John of the House of Representatives, Barney Frank....
NAR President-Elect Brays About Banks
Posted on May 11, 2008The National Association of Realtors has long been a favorite target of this blog, primarily because we love to bag game that's easy to hunt, and NAR is so easy that it really ought to be considered roadkill. Last year,...
How About A Moratorium On Moratoriums?
Posted on May 08, 2008Word came today from Teresa Rice, General Counsel of the Minnesota Bankers Association, that a major amendment was made on the Minnesota Senate floor on Monday of this week that exempts loans originated buy state or federal banks, savings banks,...
Not So Astonishing
Posted on May 07, 2008Law professors Elizabeth Warren and Adam Levitin over at Credit Slips have got themselves worked up about "a new idea," an "astonishing" one (according to Professor Levitin), concocted by those dastardly national banks and federal thrifts: "They shouldn't have to...
A Word To The Unwise
Posted on May 06, 2008I see by the attempted comments and e-mail that it's time to re-post this warning from last February. Predatory lending shills and mouthpieces are not only classless, they're clueless. No wonder they're so bereft of support from anyone other than...
True Men Of PR Genius
Posted on May 05, 2008The past week's Stevie Wonder Award, presented to the financial institution or affiliated party that was so blind it could not see that it was stepping in a public relations cowpie of epic breadth and depth, goes to...[drum roll]...: It's...
Investigation Damns Dann
Posted on May 04, 2008Ohio Attorney General Marc Dann's attention will likely be diverted by more than trial court judges berating him for pushing his political career by intervening in foreclosure proceedings. Less than a month after a public scandal exploded over allegations by...
Word Nerds Just Don't Get It
Posted on May 01, 2008According to attorney and financial consultant Tom E. Greene, most lawyers suck at understanding numbers. At least, that's my blunt take on his more diplomatically-expressed views, as communicated to well-known law blogger Robert Ambrogi. Bob interviewed Tom for an article...
FDIC Solves Subprime Crisis
Posted on April 30, 2008Last night, a reader alerted me to Damian Paletta's breaking news in The Wall Street Journal that the FDIC's Sheila Bair had assisted the Treasury Department by proposing a dandy little scheme to spend $50 billion in taxpayer funds to...
Sheila's Singing The Same Old One-Note Samba
Posted on April 29, 2008Sheila Bair won't quit. Like the Everyready Bunny, she just keeps going, and going, and going, on and on, singing the same old tired, sad, off-key tune. The fact that her intended audience continues to passively-aggressively ignore her when she...
What We Have Here Is A Failure To Truncate
Posted on April 28, 2008The Wall Street Journal's Law Blog had an update last Friday about the status of class action lawsuits filed by aggrieved consumers (in other words, by class action attorneys who've "discovered" lead plaintiffs) to punish merchants who left too much....
Lending Tree A Little Late In Cutting Off Network Access?
Posted on April 27, 2008Luke Mullins, associate editor at US News & World Report and author of the blog "The Collar," had a post Thursday about a disturbing letter that former Lending Tree mortgage customers received this week. According to Lending Tree, "several former...
A Bi-Partisan Roll Back? Don't Bet On It
Posted on April 24, 2008Since the US Congress spends a great deal of its time making life miserable for financial institutions in this country, your ears perk up when legislators on both sides of the aisle make noises about easing the regulatory compliance burden...
Cynicism or Stupidity? You Be The Judge
Posted on April 23, 2008At the end of a long day, I tried to catch up with my "professional reading" (The Economist, The Wall Street Journal, a trade paper that doesn't list this blog in its roundup and, therefore, is dead to me, Sports...
Payday Legislation Larded Up, Then Buried
Posted on April 22, 2008A cadre of Colorado legislators set out on a jihad earlier this year to eradicate the stink of payday lending from the pristine air of the Mile High State. They vowed to drive the bottom-feeding, blood-sucking, tobacco-spitting varmints back into...
Fannie's Fraud Action Fizzles
Posted on April 21, 2008As Rod Stewart sang, "Some guys have all the luck." Certainly, Franklin Raines and Timothy Howard appear to be "fortunate sons." In August 2006, the Department of Justice dropped criminal investigations against the two former Fannie Mae officials. Last week,...
MMMMMMM! Chocolate!
Posted on April 20, 2008Two years ago we reported on the views of law professor Fred Cate that when it comes to privacy protection, banks cannot rely on consumers to do the right thing. One of the other points that Cate made in his...
Preston Jumps From The Frying Pan Into The Fire
Posted on April 18, 2008Steve Preston, a man credited with turning around (or failing to turn around, depending on your partisan agenda) the SBA, has been tagged to do the same for an Alphonso-less HUD. President Bush on Friday nominated Steve Preston, now head...
Big Law Feasts On Subprime
Posted on April 17, 2008I don't know about my readers, but when I see a headline like this one from a recent issue of the Houston Business Journal ("Law Firms Brace For Subprime Fallout"), I envision a gaggle of shysters locked in an office,...
Wise Counsel
Posted on April 16, 2008Mark Treanor's run as general counsel of Wachovia Corp. will end with his retirement this summer. Before he rides into the sunset, he's sharing his thoughts on what in-house and outside lawyers to banks ought to do and not do....
The More Things Change, The More They Really Change
Posted on April 15, 2008What difference a decade (or two) makes. This time around, while other parts of the country are being hit by declining prices and increasing foreclosures, Texas looks comparatively peachy. Texas is bucking the national trend of rising property foreclosure rates,...
Culture Wars
Posted on April 14, 2008Ethan Penner, the former CEO of Nomura Capital, wrote an Op-Ed piece in last Friday's The Wall Street Journal entitled "Our Financial Bailout Culture," that led me to believe momentarily that he and I are twins separated at birth, until...
Subprime (Sorta) Mea Culpa
Posted on April 13, 2008Dallas Morning News business columnist Cheryl Hall recently interviewed Richard Bitner, a former subprime lender based in the Dallas suburb of Plano, Texas, and the author of an ex-insider's look at how the subprime debacle occurred and how to prevent...
Marky Marc Takes After His Role Model
Posted on April 10, 2008Ohio's Attorney General, Marc "Grandstand" Dann, has done everything possible to insert himself, publicly of course, between borrowers and lenders and otherwise to do whatever it takes to follow in the footsteps of his role model, the late Eliot Spitzer...
Victims
Posted on April 09, 2008According to today's The Wall Street Journal, the subprime crisis is sweeping a lot of elderly investors down the drain, many of whom didn't realize that they were investing in the subprime mortgage market. Instead, they thought they'd been sprinkled...
How Low Can You Go?
Posted on April 08, 2008**WARNING: A LINKED STORY CONTAINS LANGUAGE SOME READERS MAY FIND OFFENSIVE, ESPECIALLY THOSE CURRENTLY RESIDING IN A MONESTARY. PROCEED AT YOUR OWN RISK** A reader sent me a link to this story before Easter, but it seemed sacrilegious to post...
Barney's Big Bailout
Posted on April 07, 2008Last Thursday?s The Wall Street Journal had a scathing editorial entitled "Uncle Subprime." The gist of it is that Congress is aiming to make Uncle Sam the "subprime lender of last resort." In the name of preventing foreclosures, House Financial...
Calling All Complaince Lawyers
Posted on April 07, 2008I don't intend to make a practice of posting job available ads, but inasmuch this one appears to fit the potential profile of a typical reader of this blog, and that the bank whose service corporation owns the mortgage company...
A Check On Excess
Posted on April 07, 2008In October 2006, the FDIC filed an appeal of a decision by Houston federal district court judge Lynn Hughes to sanction the FDIC for over $72 million for its conduct in filing and pursuing litigation (and financing an administrative proceeding...
Barney's Big Bailout
Posted on April 06, 2008Last Thursday???s The Wall Street Journal had a scathing editorial entitled "Uncle Subprime." The gist of it is that Congress is aiming to make Uncle Sam the "subprime lender of last resort." In the name of preventing foreclosures, House Financial...
A Bank? Just Kidding!
Posted on April 04, 2008I suppose that every few years, the Texas Department of Banking has to remind businesses that you can't claim to be a "bank" unless, you know, YOU ARE A BANK! State regulators have taken steps to sanction a Houston firm...
A Blueprint For A Structure That Will Never Be Built
Posted on April 03, 2008On Monday, David Milstead, the Finance Editor of The Rocky Mountain News, circulated a list of questions to an assortment of heavy hitters in financial services in Colorado (although he appears to have left off a number of others), about...
Crime and Punishment
Posted on April 02, 2008When we last looked in on Taiwan Lee a couple of years ago, he had "vanished" while out on parole, then resurfaced after committing multiple instances of mortgage fraud in Colorado. He was caught, and became a poster child for...
Was It Something I Said?
Posted on April 01, 2008Last Wednesday we called for Alphonso Jackson to resign, and just like clockwork, today he fell on his sword (actually, his dagger, but it still hurt). Some nitwits think that Senators Dodd and Murray had something to do with it,...
Six Simple Rules
Posted on March 28, 2008Banking Law Prof gives everyone a hit list of "takeaways" from the subprime mortgage mess: 1. There???s blame enough to go around. 2. Those who do not remember the past are condemned to repeat it. 3. If it sounds too...
Six Simple Rules
Posted on March 27, 2008Banking Law Prof gives everyone a hit list of "takeaways" from the subprime mortgage mess: 1. There?s blame enough to go around. 2. Those who do not remember the past are condemned to repeat it. 3. If it sounds too...
HUD Punts DAP Denial
Posted on March 27, 2008I know it's spring, but today I broke out the hockey skates, rang up The Devil, and went ice skating in Hell. I also agreed with the Editorial Board of The New York Times. Alphonso Jackson, the Secretary of Housing...
HUD Punts DAP Denial
Posted on March 26, 2008I know it's spring, but today I broke out the hockey skates, rang up The Devil, and went ice skating in Hell. I also agreed with the Editorial Board of The New York Times. Alphonso Jackson, the Secretary of Housing...
The Barbie Bandits Get Benched
Posted on March 26, 2008Crime may not pay, but it certainly hurts a lot less for criminals who are tall, blond, female, young and cute. Recently, bank robbers in Dallas have been having "Maxwell's Silver Hammer" come down, on their heads. Dallas bank robber...
The Barbie Bandits Get Benched
Posted on March 25, 2008Crime may not pay, but it certainly hurts a lot less for criminals who are tall, blond, female, young and cute. Recently, bank robbers in Dallas have been having "Maxwell's Silver Hammer" come down, on their heads. Dallas bank robber...
Separating Some Of The Chaff From The Rest Of The Chaff
Posted on March 25, 2008Colorado's new mortgage broker licensing law has already kept some questionable characters out of a profession where a good man (or woman) is sometimes hard to find. According to a recent story in The Rocky Mountain News, Colorado's Director of...
Separating Some Of The Chaff From The Rest Of The Chaff
Posted on March 24, 2008Colorado's new mortgage broker licensing law has already kept some questionable characters out of a profession where a good man (or woman) is sometimes hard to find. According to a recent story in The Rocky Mountain News, Colorado's Director of...
Regulatory Flexibility
Posted on March 24, 2008Rooting around, searching for something totally unrelated, I recently unearthed a recent Office of Thrift Supervision Approval of Rebuttal of Control granted to Legg Mason Inc. and certain related entities in January. The rebuttal was filed in connection with the...
Regulatory Flexibility
Posted on March 23, 2008Rooting around, searching for something totally unrelated, I recently unearthed a recent Office of Thrift Supervision Approval of Rebuttal of Control granted to Legg Mason Inc. and certain related entities in January. The rebuttal was filed in connection with the...
Moral Hazards
Posted on March 21, 2008A colleague and friend wrote to me recently about what I thought of this article in last Sunday's The New York Times by Gretchen Morgenson, that starts off with a typical focus for The Grey Lady: the venality of big...
Moral Hazards
Posted on March 20, 2008A colleague and friend wrote to me recently about what I thought of this article in last Sunday's The New York Times by Gretchen Morgenson, that starts off with a typical focus for The Grey Lady: the venality of big...
Bad Legislation Just Keeps On Coming
Posted on March 18, 2008Although a final condemnation will have to await the drafting of a bill that's in process in Colorado, a preliminary press report justifies a hearty shout of "WTF"? With foreclosure rates a problem in Colorado and throughout the country, Rep....
Wamu Wins Big
Posted on March 17, 2008Buried in the back pages of the trade press last Friday, while the meltdown of Bear Stearns and the usual Congressional posturing in advance of its "Spring Break" occupied the attention of reporters inside and outside the banking biz, was...
All Clear
Posted on March 12, 2008On the road again, for the rest of this week. Readers are safe from further bloviations until next Monday. In the meantime, watch Jim Cramer get (as today's NewsBusters phrased it) verklempt over Eliot Spitzer on this morning's Today Show....
Short Sellers Got No Reason To Live
Posted on March 11, 2008In South Florida, the pickings are slim for those who push short sales. They may be trolling, but the banks aren't biting. Local real estate professionals say there is growing interest in the residential short sale, but only grudging acceptance...
Unsafe At Any Price
Posted on March 10, 2008Eliot ("Mess") Spitzer: He's a punk. He's a bully. He's a liar. He's a hypocrite. Now, he's also just another busted "John." I guess we could sing it Steve Miller's way: I'm a joker I'm a smoker I'm a midnight...
More Accurate Identity Theft Reporting By Banks: The Opening Salvo
Posted on March 09, 2008Last year, Chris Hoofnagle, Senior Staff Attorney, Samuelson Law, Technology & Public Policy Clinic and Senior Fellow, Berkeley Center for Law and Technology, University of California-Berkeley Boalt Hall School of Law, published an article in the Harvard Journal of Law...
The Coach Is Busy, So He's Showing A Film
Posted on March 04, 2008While unsuspecting subprime borrowers are being swept away by a tsunami of foreclosures, yours falsely is about to be swept away by a tsunami of contracts. Therefore, in lieu of actual blogging, I'll merely post a couple of videos worth...
Another BSA Victim
Posted on March 03, 2008More evidence of the unrelenting brain damage being inflicted upon commercial banks by federal bank regulators over Bank Secrecy Act/Anti-Money Laundering Act compliance failures surfaced last week in press reports that the California national bank subsidiary of Dutch commercial banking...
Dirty Harry Misfires
Posted on March 02, 2008After guaranteeing last week that he could invoke cloture to prevent Senate Republicans from putting the brakes on his rush to enact bankruptcy reform proposals, Senate Majority Leader "Dirty Harry" Reid ended up with not the 60 votes he said he had in his pocket, but a scant 48...
HUD Stubs Toe On RESPA
Posted on February 28, 2008Yeah, this is old news, but we've been busy and are just getting around to reading old blog posts and newsletters. We never promised you up-to-date news, just unvarnished snark. We've been yammering about violations of RESPA's anti-kickback and anti-referral prohibitions since this blog first inflicted itself upon an unsuspecting public...
Dirty Harry Tells Prez: "Make My Day!"
Posted on February 27, 2008We all expected a Senate vote yesterday on Little Dickie Durban's Bankruptcy Reform-of-the-Reform Bill, that would allow bankruptcy judges to rewrite residential mortgage loans. Unfortunately, the Senate chose to take up a much less controversial matter: scaling back military operations in Iraq...
VISA's IPO Benefits Banks
Posted on February 26, 2008When we discussed the potential positive effects of Visa's announced intention to engage in a public stock offering fourteen months ago, we didn't list one that since that time has become its biggest apparent benefit: boosting Visa member banks' capital...
Sheila Bair: CDO Lawyer
Posted on February 25, 2008Sheila Bair continues to say anything...ANYTHING...to satisfy her consumer advocacy fetish. Her latest exercise in self-pleasuring came last Friday, in a speech in San Jose (I guess she knew the way). She was hell-bent on continuing to give legal advice to servicers of collateralized subprime mortgage debt obligations as to how to best serve the interests of various classes of bond holders without getting themselves sued by an unhappy class...
Subprime? Not Here, Hoss.
Posted on February 24, 2008This article pretty much confirms my recent experience, limited though it may be. Small, local banks like Cardinal have largely avoided the problems larger banks face from the subprime meltdown. Most community banks in the Washington region generally don't rely just on residential real estate mortgages for profits...
You Can Sue, But Can You Collect?
Posted on February 21, 2008It's easy to see the chickens coming home to roost when you live inside the coop. That's why those of us coop-dwellers who represent banks and thrifts who engage in mortgage banking have been warning for the last several years (for example, here and here) about the threat to not only the bottom line, but to capital, posed by "buy-back" obligations...
The Biggest Winners
Posted on February 20, 2008When Housing Wire observed last month that the biggest winners of the current mess in the mortgage markets would be lawyers, he wasn't whistling "Dixie." Navigant Consulting, Inc., a global provider of business, regulatory and financial advisory services, released a study today that shows the number of subprime-related cases filed in federal courts dramatically outpacing the savings-and-loan (S&L) litigation of the early 1990s...
Fifth Third Sued Over Vendor's Error
Posted on February 19, 2008When we first discussed a vendor's error that led to negative effects on borrowers' credit scores, which in turn led to a massive headache for Fifth Third Bank, we noted a consumer law expert's opinion that injured consumers would have little recourse, at least under federal law...
Congress Craves Cramdowns
Posted on February 18, 2008Cramdowns in Chapter 13 bankruptcy proceedings is an idea that appears to be on the fast track. Congressional Democrats aren't going to let the matter drop and they've got a new angle. They're arguing that it's "foreclosure relief" for innocent borrowers who are about to lose their homes due to the evil machinations of greedy, heartless lenders who tricked them into borrowing money on terms they couldn't afford in order to steal their family homesteads...
The Real Meaning of "Special Interest"
Posted on February 18, 2008While Democrats in Congress (and in various state houses) have been kicking banks to the curb over their alleged role in the foreclosure "tsunami" washing over this great land we like to call "the land of the free and the home of the knave," Republicans are proving that they're good politicians: those who, when they're bought, stay bought...
Eliot Spitzer: Idiot
Posted on February 14, 2008Someone needs to hit Eliot Spitzer with a Thorazine dart, slap a straight jacket on him, and strap him to a gurney before his Bush Derangement Syndrome causes his head to explode. Not that if that happened, any bystanders would be splattered with gray matter, but when a vacuum is breached, the concussive effects of the implode can be devastating...
Red Means Stop, Green Means Go
Posted on February 12, 2008Due to the Darwinian dictates of my so-called "profession," clients actually expect their legal counsel to work in return for the payment of fees billed. What is WRONG with this picture??? As a result of this sad state of affairs, posting will be spotty for the rest of this week...
OTS Keeps Pitching
Posted on February 11, 2008As previously reported, OTS Director John Reich is relentless in his shilling for a continued role for the OTS as a federal regulator. He's jumped all over proposals from Congress that a federal regulator oversee previously unregulated mortgage brokers and bankers...
CheckFree Pushes Consumer RDC
Posted on February 10, 2008In response to my skepticism last week about remote deposit capture's path to glory in the consumer arena, commenter Elisabeth demurred: "I imagine that in the not too distant future, RDC for consumers will be old hat." She may very well be on to something...
Ohio AG Sliced, Diced and Julienned By State Magistrate
Posted on February 08, 2008In between holding press conferences concerning his brain storm to stem the tsunami of loan foreclosures in Ohio through the use of mediation and suing Freddie Mac for fraud for not publicly disclosing that it was conspiring to wreck the economy, Ohio Attorney General Marc Dann has jumped on a bandwagon started in November, when federal district court judges in Ohio started dismissing, without prejudice, foreclosure actions filed in federal court by foreclosing lenders who lacked documentary evidence to prove that they owned the loans they were foreclosing prior to the commencement of the foreclosure actions...
The Coalition of the Wilting
Posted on February 07, 2008In addition to keeping busy squawking about the slow pace of across-the-board loan modifications for subprime mortgagors (h/t Calculated Risk), an alert reader pointed out that our "Little Mz. Sheila" has been busy with one of her pet projects: roping poor FDIC-insured commercial banks into making unprofitable "affordable small dollar loans" (unsecured, of course) to subprime borrowers...
Ford Comes Forward
Posted on February 06, 2008There were no hats and horns in evidence last week when the FDIC's moratorium on approving applications for industrial loan corporations and industrial banks quietly expired. The week prior to the expiration, Home Depot joined Wal-Mart (paid subscription required) in pulling its pending application to acquire EnerBank off the table because, according to a Home Depot spokesperson, "the bank no longer fit its 2008 strategy of focusing solely on its retail operations...
Adjusting The Underwriting "Shower"
Posted on February 05, 2008As we said last October, ...[I]t's likely that some bad legislation will be enacted that will over-correct prior (and no longer persistent) market practices and exacerbate the current credit squeeze by making housing credit tougher to obtain and more expensive for prime, as well as "less than Grade A," borrowers...
Remote Deposit Capture: A Consumer Service?
Posted on February 04, 2008Last April, we commented on the increasing use by banks' business customers of "remote deposit capture" services, by which business scan and electronically transmit to their bank electronic images of checks that the customer would otherwise have to physically deposit via a bank branch, ATM, overnight deposit box or courier service...
Sunday Funnies
Posted on February 03, 2008Some articles of interest for those of us with nothing better to do: CIO Asia has a one year look back at the TJX breach that we've discussed (most recently here) and finds some interesting lessons. One of them is that data breaches can be incredibly costly...
Bair Broaches Another Bad Idea
Posted on February 02, 2008What are you doing here? Run over to Calculated Risk and read Tanta's fisking of FDIC Chairman Sheila Bair's most recent exercise in self-pleasuring via a demand that lenders write down the principal amount of their first lien loans to the "current value" of the property securing the loans, and why it won't work on the scale that Bair presupposes...
Good News: Bankruptcy Work Is Booming
Posted on February 01, 2008Last May, l wrote about the claim that due to the Bankruptcy Reform Act of 2005, it was hard to find enough lawyers who were willing to take on personal bankruptcy work. We're pleased to report that ten months later, that no longer seems to be a problem...
From Russia, With Love
Posted on January 31, 2008Fort Worth-based OmniAmerican Bank was the target of a sophisticated band of cyber crooks recently, which hacked into the bank's system, "stole account numbers, created new PINs, fabricated debit cards, then withdrew cash from ATMs in Eastern Europe, including Russia and Ukraine, as well as Britain, Canada and New York...
Another Whistle Blower Blows The Whistle
Posted on January 31, 2008As residential real estate lenders continue to suffer, more claims emerge that certain corners of the business may have been rotting from the inside out long before anyone noticed the smell. We recently profiled outside appraiser Jennifer Wertz, who was allegedly blackballed by Washington Mutual, and a former credit analyst, who claimed he was fired by Wamu, for "doing the right thing," or, more accurately, refusing to "do the wrong thing...
Doing The Chavez Shuffle
Posted on January 30, 2008A few readers have asked for my thoughts about the call last week of tin horn Venezuelan socialist dictator and Tony Soprano wanna-be Hugo Chavez, a man whose face appears once to have been set on fire and beaten out with a rake, for South American nations to pull their reserves out of U...
To Dream The Impossible Dream
Posted on January 29, 2008It's not as if we didn't see this coming. According to yesterday's American Banker (paid subscription required), the US Justice Department is about to hit money services business Sigue Corp "with a record money laundering fine "that experts said signals more aggressive enforcement of the Bank Secrecy Act...
And The Winners Are...Trial Lawyers
Posted on January 28, 2008Housing Wire's Paul Jackson ended a post last Friday about the expansion of New York City's class action lawsuit Countrywide Financial Corporation and others with the words "It?s pretty clear that the biggest winners out of current market turmoil are the lawyers...
No Longer Civil
Posted on January 26, 2008Last spring, The Arizona Republic ran an article that gave a laundry list of lawsuits that large lenders and Wall Street firms were filing against local lenders, brokers, agents, appraisers, title companies, and other third parties who had engaged in bilking them through various mortgage fraud schemes, particularly with respect to subprime mortgages...
Bank Customers Still Going Phishing (and Vishing)
Posted on January 25, 2008The American Banker (paid subscription required) reported last month that notwithstanding banks' efforts to thwart "phishing," more bank customers are falling for phishing schemes. The number of people who said they lost money as a result of a phishing scam rose 43% from a year earlier, to 3...
California: Here It Comes
Posted on January 24, 2008Our federal solons are busy concocting sweet treats for the voters in an election year, the kind that melt in your mouth, give you a brief sugar high, then bring you crashing back down to earth smack dab in the midst of an economic cycle that will work its way out the painful way regardless of your wishful thinking...
Who's On First?
Posted on January 24, 2008Among the many MENSA members who populate the US Congress and who are helping to straighten out the mortgage mess is Rep. Marcy Kaptur of Ohio, a Democrat, a 13-year veteran of the House, and member of the House Budget Committee. Tuesday's American Banker (paid subscription required) had a priceless tidbit that illustrates that the Bozo Factor is alive and well in halls of Congress...
Mortgage Modification And The "Free" Market
Posted on January 23, 2008Hell hath no fury like a bureaucrat scorned.---Milton Friedman "Did, too!""Did not!""Did, too!""Did, not!" No, that's not Paris Hilton and Britney Spears fighting over who went commando in the limo last night, that's the Mortgage Bankers Association and FDIC Chairman Sheila Bair having in their own little bitch-slap-fest last week concerning whether or not mortgage loan servicers are modifying residential loans quickly enough to satisfy the "unreasonably imprudent subprime lender test...
Wamu Continues To Take Its Lumps On Appraisal Practices
Posted on January 22, 2008Although it's fun to poke fun at Andy Cuomo's publicity-hounding ways, his investigation into Washington Mutual's appraisal practices continues to look like it might be based upon more than pure ether-induced hallucinations. The Wall Street Journal reported last Friday that Wamu has been sued by former appraiser Jennifer Wertz, who alleges that Wamu pressured her to revise her fair market valuations upward, and black-listed her when she refused...
Wal-Mart Embraces Mexican Microlending
Posted on January 22, 2008Readers may remember when Wal-Mart took its marbles away from the ILC-acquisition game, told the FDIC ?thanks? for doing its job of acting promptly on applications so well, and went home to implement Plan B in its quest to dominate the field of selling retail financial services to the average American Jack and Jill...
Cleveland Reeks! Cleveland Reeks!
Posted on January 21, 2008Although Baltimore was first out of the gate in the race to the courthouse by broken cities in order to "rob back" the banks that the cities believe robbed them, the recent suit filed by Cleveland seems to me the more bizarre piece of litigation...
Predatory Borrowing
Posted on January 20, 2008I'm just getting around to reading a nifty blog post by Conde Nast Portfolio.com blogger Felix Salmon (h/t Housing Wire), who jumps into a hissy fit between New York Times columnist Tyler Cowen and blogger Barry Ritholtz. Cowen alleged that "predatory borrowing" (fraud by borrowers) may have been a bigger problem in the residential mortgage mess than "predatory lending...
Fire Away
Posted on January 17, 2008Readers continue to send e-mails that contain death threats constructive criticism of an errant bloviation that appeared on this blog or brain-injury-inflicting thought-provoking questions concerning a topic about which I don't give a damn haven't yet blogged...
Multifactor Authentication Is Not A Panacea
Posted on January 16, 2008While some bankers took a laidback approach to multifactor authentication requirements that were effective January 1, 2007, it appears that the vast majority banks "got with the program." In an article in the American Banker (paid subscription required) shortly before the start of the new year, reporter Daniel Wolfe noted that "most banks" met the January 1, 2007 deadline...
Conspiracy Theory: Are They Greased Wheels Or Is It A Greased Pig?
Posted on January 15, 2008I was traveling the last few days, unable to blog, and blissfully unaware of the really important stuff happening in the wide world of banking law. I returned home today to find this article from Seeking Alpha, (h/t Housing Wire), breathlessly entitled "Countrywide Buyout Deal Greased From The Start...
Loose Lips Can Sink Dips
Posted on January 11, 2008In the midst of the rumors about Countrywide Financial Corp.'s financial condition over the past few days, some readers have sent me links to blog posts that could be read as allegations that Countrywide Bank, the thrift subsidiary of Countrywide Financial Corp...
Those Who Don't Know History Are Bound To Misstate It
Posted on January 10, 2008A reader sent a link to this blog post and said "what do you think?" The answer is, "Not much, and yet, quite a bit." Here's a mortgage expert's (at least, that's how he's billed) take on the 1980s S&L crisis, and how we haven't learned from it, or, maybe how banks have learned from it, but the lesson they learned is how to be bad guys and get away with it...
The Fine Print
Posted on January 08, 2008Contracts between banks and their technology service providers need to be carefully reviewed by competent legal counsel, as well as by knowledgeable bank employees. Why? Well, it should be sufficient to state that regulatory agency guidelines advise banks that contractual review be taken seriously, as a matter of basic safety and soundness, and that certain laws require that certain contracts with certain vendors comply with certain legal requirements (such as the privacy and security requirements of the Gramm-Leach-Bliley Act)...
There Ought To Be A Law
Posted on January 07, 2008One of the perverse benefits (which a sane man would consider a curse) of writing this blog is that I get to interact with tin foil hat wearers of all stripes, from throughout this spinning globe I like to call "Planet Earth." They sing their sad songs of woe, and sometimes, right before they're swept away in a river of their own tears, they humbly beseech me to alert the world to some heinous injustice being perpetrated upon the proletariat by the evil capitalist oppressors who run the mortgage lending industry...
Unleash The Litigators!
Posted on January 06, 2008A couple of months ago, we noted that law firms large and not-so-large were trotting out "subprime mortgage practice groups" and salivating about all the great litigation and bankruptcy work that would flow from the crisis. The main stream media continues to beat the drum about how no one will benefit from this crisis but those damned lawyers...
No Good Deed Goes Unpunished (Example No. 432)
Posted on January 04, 2008Yesterday, Tanta at Calculated Risk posted the following public service video prepared by Freddie Mac and launched on YouTube. In her customary pithy style, Tanta gives a synopsis of the spot: To summarize: if you're in the situation you're in with an unaffordable mortgage because some fast-talking guy in a suit asked you to sign a bunch of papers you didn't understand, you are not going to be in a better situation because some other fast-talking guy in a suit asked you to sign a bunch more papers you don't understand...
Tilting At Windmills
Posted on January 03, 2008One of those personal interest stories that so warms the heart over the holidays made it to the front page of The Wall Street Journal (paid subscription required) last week. It concerned a man and his mission: to live free or die. Well, not "die," actually, more like "or be evicted," but the "live free" part is accurate...
Option ARM Armageddon?
Posted on January 02, 2008According to the Los Angeles Times, the subprime mortgage crisis was just the tip of the iceberg when it comes to the global warming meltdown in the wide world of mortgage lending. Next up: option ARMs. There's another time bomb waiting to explode, experts say: risky loans made to people with good credit...
Bailing Out The Bad Guys
Posted on December 27, 2007I wonder how mandatory mediation will work with crooks? According to The Wall Street Journal, "[f]raud goes a long way toward explaining why mortgage defaults and foreclosures are rocking financial institutions, Wall Street and the economy." The Federal Bureau of Investigation says the share of its white-collar agents and analysts devoted to prosecuting mortgage fraud has risen to 28%, up from 7% in 2003...
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How do you recover money from a stop payment placed on a personal check given to you?
you can always take them to small claims court and sure them for 3 times the amo...
How to prove child support payments were sent by US Mail?
Your best bet is to send the checks via certified mail return receipt requested....
Some elses debt is being reported by a bank to the crecit agencies. They know and have ackowledged it is not mine, yet it is still being listed as mine. it was my son's and no I didn't co-sign. It is adversly
It is easy for the bank and the credit reporting agencies to clear this confusio...
My job requires me to drive bank deposits up to two times a day using my own vehicle and gas. Although not too far, can should I be receiving compensation? One deposit run is required daily by company policy, but the man
you should be getting a mileage comp. I own my own company and I pay my employee...
Does a Chapter 7 bankruptcy discharge a secured mortgage loan?
Yes if you file they cannot sue you to the knowledge I know. My brother is in re...
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