It wasn’t long ago that big banks on both sides of the Atlantic engaged in mortgage and subprime mortgage lending practices that mimicked the kind of lawlessness that permeated the Wild West; this led, in no small part, to the global financial crisis of 2007 — that same financial crisis that still seems to be affecting the U.S. economy and economies abroad. With JPMorgan Chase recently acknowledging wrongdoing for their role in the mess along with a settlement that requires them to pay $13 billion to Uncle Sam — with $2 billion of that sum stemming from fraud penalties — it looks as though it’s finally come time for some big banks to be held accountable. If you want to know more about financing stability, visit this dedicated website: https://www.topsmnews.com/.
The ins and outs of the subprime mortgage crisis of seven years ago are a complicated mess with many players, and immediate blame likely won’t yield accurate results. That being said, because so many of the mortgages that ended up in default were backing elaborate securities and other debt obligations, the boom and subsequent failure of the subprime mortgage sector had a radical and far-reaching effect on the overall economies of the entire world. Thankfully, concerned individuals can learn to detect fraud with a degree in economic crime investigation to prevent future occurrences. While homeowners, regulators, governments, and realtors all participated in the events that led to the crisis, at least as far as Attorney General Eric Holder is concerned, the big banks’ ill-intentioned maneuvering of billions of dollars in mortgage-back securities has garnered negative attention of the United States Justice Department. Here is a look at some of the biggest banks and the cases against them.
The largest bank in the United States, JPMorgan reported a profit of $18 billion last year, which, while it was down $3 billion from the year before, is still a considerable sum — especially when you consider that it’s the total after a host of legal fees and penalties like the $13 billion mentioned above. When the Justice Department’s investigation of the bank started back in 2012, evidence came to light of wrongdoing in how JPMorgan marketed, packaged, and sold mortgage-backed securities. One of the most interesting penalties, costing JPMorgan $614 million, related specifically to how the bank approved thousands of insured loans not insurable by the federal government, effectively guaranteeing that if those loans defaulted, the Federal Housing Association and Veterans Affairs would suffer substantial losses. Are you interested to learn more about mortgage crises? Visit this dedicated website https://ugenmedia.com/ for useful information.
Bank of America
Even though it’s facing a Justice Department investigation and lawsuit related to its participation in careless mortgage securities, Bank of America still managed to net a 2013 fourth-quarter profit of $3.4 billion. While the investigation is still underway, one jury has already found the bank guilty of committing fraud when its Countrywide unit knowingly sold defective mortgages in the years leading up to the financial crisis. Originally, the U.S. government had only sought monetary damages related to the losses suffered by the government-backed companies Fannie Mae and Freddie Mac as a result of the Countrywide debacle. That amount has been amended from its original $860 million to over $2 billion so that it now includes the revenue gained by the bank as a result of the fraud.
While not a lot is known about the Justice Department’s current investigation into Goldman Sachs, the bank did state in its last quarterly report that the DOJ’s task force’s findings could result in a “significant increase” in the company’s future liabilities. Civil suits have already been brought against the bank and settled, but if the penalties and fees levied against JPMorgan and Bank of America are any indications of what’s in store for Goldman Sachs, the bank has a much greater monetary loss in store for it.
The United States economy took a massive hit when the subprime mortgage crisis hit in 2007; it’s a hit many workers, businesses, families, and banks have still not recovered from. As the Department of Justice seeks to get to the bottom of any criminal wrongdoing and fraud, the fees and penalties are piling up. Hopefully, this government action bodes well for a safer economic future for everyone. Go to this website https://www.newshubnetwork.com/ in order to acquire additional information.