Top Leaderboard, Site wide
Truthdig: Drilling Beneath the Headlines
June 22, 2017 Disclaimer: Please read.

Statements and opinions expressed in articles are those of the authors, not Truthdig. Truthdig takes no responsibility for such statements or opinions.

What’s Next for the Bill Cosby Sex-Assault Case?

Truthdig Bazaar
The Idea of Justice

The Idea of Justice

By Amartya Sen

more items

Ear to the Ground
Email this item Print this item

U.S. Agency Set to Sue Big Banks on Mortgage Deals

Posted on Sep 2, 2011
Flickr / respres (CC-BY)

The Federal Housing Finance Agency is set to file lawsuits against more than a dozen big banks for allegedly misrepresenting the quality of mortgage securities they were assembling and peddling at the height of the housing bubble.

Three unnamed officials told The New York Times that the agency plans to seek billions of dollars in the suits against Bank of America, JPMorgan Chase and Goldman Sachs, to name a few, and that they plan to file the suits in federal court in the next few days. —BF

The New York Times:

In July, the agency filed suit against UBS, another major mortgage securitizer, seeking to recover at least $900 million, and the individuals with knowledge of the case said the new litigation would be similar in scope.

Private holders of mortgage securities are already trying to force the big banks to buy back tens of billions in soured mortgage-backed bonds, but this federal effort is a new chapter in a huge legal fight that has alarmed investors in bank shares. In this case, rather than demanding that the banks buy back the original loans, the finance agency is seeking reimbursement for losses on the securities held by Fannie and Freddie.

The impending litigation underscores how almost exactly three years after the collapse of Lehman Brothers and the beginning of a financial crisis caused in large part by subprime lending, the legal fallout is mounting.

Read more

New and Improved Comments

If you have trouble leaving a comment, review this help page. Still having problems? Let us know. If you find yourself moderated, take a moment to review our comment policy.

Join the conversation

Load Comments
prisnersdilema's avatar

By prisnersdilema, September 3, 2011 at 8:13 am Link to this comment

Try to think it through….

This comes at a time when the states are mounting prosecutions of their own.

The Federal government in an effort to protect their beloved banks, has attempted to get the states to back off. This effort as been largely unsuccessful.

So now the feds step in with a lawsuit of their own. Of course the banks will settle for a pittance. And since federal law takes precedence over state law, this effectively protects the banks from further action by the states.

So nothing to worry about, the banks are bailed out again.

Free Enterprise prevails.

Report this

By Marian Griffith, September 3, 2011 at 1:49 am Link to this comment
(Unregistered commenter)

Three years late, but at least it is happening.

Now if somebody can come up with a viable way to put a brake on the runaway money spinning machine that is the international finance, we might actually have a chance to turn this whole disaster around and restore national and international economy to a more sane foundation.
Of course getting about 200 governments with wildly different interests (and thousands of banks and traders who wield enough influence to topple all but the largest four or five economies) to agree on anything makes herding cats look trivial by comparison.

Report this
A Bird in the Hand's avatar

By A Bird in the Hand, September 2, 2011 at 1:53 pm Link to this comment

It’s about time..

Report this
PatrickHenry's avatar

By PatrickHenry, September 2, 2011 at 12:42 pm Link to this comment

Good, a legal tax by any other name.

Report this
Right Top, Site wide - Care2
Right Skyscraper, Site Wide
Right Internal Skyscraper, Site wide

Like Truthdig on Facebook