The Resolution Law Group: FDIC Sued by JPMorgan Chase in $1B Securities Case Involving Washington Mutual Purchase & Mortgage-Backed Securities

JPMorgan Chase (JPM) is suing the Federal Deposit Insurance Corp. for over $1 billion dollars related to the bank’s purchase of Washington Mutual (WMIH). The financial firm said that the FDIC did not honor its duties per the purchase agreement.

When Washington Mutual suffered the biggest bank failure in our nation’s history during the financial crisis in 2008, FDIC became its receiver and brokered the sale of assets. JPMorgan, which made the purchase for $1.9 billion, says that the FDIC promised to protect or indemnify the bank from liabilities. Regulators had encouraged the firm to buy Washington Mutual hoping this would help bring back stability to the banking system.

Since then, however, contends JPMorgan, the FDIC has refused to acknowledge mortgage-backed securities claims by investors and the government against the firm. The bank says that the cases should have been made against the receivership instead. (In its lawsuit, JPMorgan says there are enough assets in the receivership to cover a settlement with mortgage companies Freddie Mac (FMCC) and Fannie Mae (FNMA) and other claims, such as a slip and fall personal injury case involving a Washington Mutual branch.) Meantime, the FDIC maintains that JPMorgan is the one who should be accountable for any liabilities from its acquisition of Washington Mutual.

Since 2008, JPMorgan has agreed to multiple MBS settlements. Investors lost millions from bundled mortgages as the housing market crumbled and they wanted their money back. Recent settlements include last month’s $13 billion deal with the Justice Department and state regulators over mortgage-linked bonds, and another $4.5 million agreement with 21 institutional investors.

JPMorgan also says that it wants the FDIC receivership to separately take care of possible damages from the litigation brought by Deutsche Bank National Trust Company. The latter wants up to $10 billion on behalf of over 100 trusts that have Washington Mutual-issued bonds that have performed poorly.

If you suspect you sustained losses caused by institutional investor securities fraud, contact The The Resolution Law Group today.

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The Resolution Law Group: RBS Securities Inc. Settles SEC’s Subprime RMBS Lawsuit for $150M

RBS Securities Inc., which is a Royal Bank of Scotland PLC. Subsidiary (RBS), has agreed to pay $150 million to settle Securities and Exchange Commission allegations that it misled investors in a $2.2 billion subprime residential mortgage-backed security offering in 2007. The money will be used to pay back investors who were harmed.

The SEC claims the RBS said that the loans backing the offering “generally” satisfied underwriting guidelines even though close to 30% of them actually were so far off from meeting them that they should not have been part of the offering. As lead underwriters, RBS (then known as Greenwich Capital Markets,) had only (and briefly) looked at a small percentage of the loans while receiving $4.4 million as the transaction’s lead underwriter.

SEC Division Enforcement co-director George Cannellos said that inadequate due diligence by RBS was involved. The Commissions also says that because RBS was in a hurry to meet a deadline established by the seller, the firm misled investors about not just the quality of the loans but also regarding their chances for repayment.

Of the $150 million that RBS will pay, $80.3 million is disgorgement, $25.2 million is prejudgment interest, and $48.2 million is a civil penalty.

The Resolution Law Group’s RMBS fraud lawyers are here to help investors get back their losses. Unfortunately, many investors lost money in different types of mortgage-backed securities during the economic crisis. Often the investments were recommended by stockbrokers and financial advisers even if they were unsuitable for the client or when not enough proper due diligence was conducted to make sure the investment was a wise one. Contact The Resolution Law Group today.

The Resolution Law Group: The housing market will continue to suffer until it is fixed by the Courts or the Legislature.

When lawyers for the City of Los Angeles filed a lawsuit against Deutsche Bank two years ago, they criticized the world’s fourth-largest bank as among the city’s worst slumlord and sought hundreds of millions of dollars in penalties and restitution.

Despite the fanfare and rhetoric when the case was brought, the city of Los Angeles just announced that it settled with Deutsche Bank for only ten million dollars and that the settlement money was not going to be paid by the bank.

Geoffrey Broderick, the senior partner of the Resolution Law Group, says “Deutsche Bank foreclosed on more than 2,000 homes in metropolitan Los Angeles between 2007 and 2011. Many homes fell into disrepair and crime increased in the neighborhoods where the foreclosures took place. “

Mr. Broderick adds that “The housing market will continue to suffer until it is fixed by the Courts or the Legislature. Somebody has to fix the problem. That is why The Resolution Law Group continues its fight for homeowners. Homeowners cannot expect the problem to fix itself.”

The Resolution Law Group continues to prosecute ground breaking litigation in Federal Court on behalf of homeowners suing lenders and servicers for, among other things, the illegal use of MERS, robo-signing, and intentionally ignoring underwriting standards and encouraging inflated appraisals.

The Resolution Law Group is currently enrolling clients into the pending lawsuit. For further information, visit its website at www.TheResolutionLawGroup.com

If you feel you are the victim of Mortgage Fraud, please do not hesitate to email or call the The Resolution Law Group (203) 542-7275 for a confidential, no obligation consultation.

JPMorgan Found Liable in Billionaire’s Subprime Mortgage Lawsuit for Over $50M in Damages

In the State Supreme Court in Manhattan, Justice Melvin Schweitzer found JPMorgan Chase (JPM) liable for breach of contract when it put high-risk subprime mortgages in an account held by investor Leonard Blavatnik. Now, the financial firm must pay the Russsian-American billionaire more than $50 million in damages–$42.5 million for the breach and 5% interest from beginning May 2008. However, JPMorgan was not found liable for negligence.

Blavatnik, who Forbes magazine says is the 44th wealthiest person in the world, filed his securities fraud case against JPMorgan in 2009. He contended that the investment bank lost over $100 million on about a $1 billion investment made by CMMF L.L.C., which is a fund that Access Industries, his company, created. He says JPMorgan promised him that the money would be invested conservatively but instead breached a 20% mortgage-backed securities limit when it misclassified securities that were backed by a subprime loans pool—ABS home-equity loans—as asset-backed instead of as MBSs.

Access, Blavatnik’s company, claims that the bank kept holding the securities even though it knew that they were not right for the portfolio. In May 2008, CMMF shut down the account.

Judge Schweitzer found the bank liable for going beyond the cap limit while rejecting the firm’s claim that it was a practice in the industry to separately classify mortgages securities and home equity loans because they don’t a carry the same risk. Regarding the negligence claim, he said that the mortgage securities were generally safe when they were purchased and that the financial firm behaved reasonably when it suggested CMMF wait instead of selling at such low prices.

Meantime, JPMorgan also is contenting with other investigations and lawsuits over the way it dealt with its mortgage business during the economic crisis of 2008.

Our MBS fraud lawyers represent investors throughout the US.

The Resolution Law Group: Mortgage REITs See a Slump

Real estate investment trusts that purchase mortgage debt has taken a dive after an employment report that was better than forecasted spurred speculation that the Federal Reserve will begin to make its asset purchases smaller in size. According to data, the United States added 195,000 jobs in June, even though a median forecast in a Bloomberg News survey predicted only 165,000 new jobs. Meantime, mortgage securities backed by the government experienced their largest quarterly losses in 19 years during the three months leading up to the end of June. Certain mortgage REITs even had to use money that was borrowed to amplify possible returns.

Financial firms that purchase mortgage bonds and loans have been contending with speculation that the Fed will lower its $85 billion of monthly debt purchasing as the economy begins to look like it is improving. Unfortunately, a lot of mortgage REITs did not see the recent sharp rise in interest rates. These higher rates decrease the likelihood that homeowners will refinance their mortgage rates. To reflect the upped risk of holding high duration bonds in the long-term, the securities have dropped in value. That many of the REITs did not foresee the interest rates job could be an indictor that they were unprepared and have been complacent.

Mortgage REIT Fraud
Mortgage real estate investment trusts purchase mortgage-backed securities or mortgage that exist or lend money to the owners of real estate for their mortgages. These REITs are involved in investing and owning property mortgages while revenues primarily come via interests made on mortgage loans.

If you feel you are the victim of Mortgage Fraud, please do not hesitate to email or call the The Resolution Law Group (203) 542-7275 for a confidential, no obligation consultation.

Lender Litigation, Unlawful Foreclosure, Tarp Money, Mortgage Backed Securities, Derivitives Lawsuits, Insider Trading Lawsuit, SEC Settlements, Ponzi Scheme Lawsuits, Intentional Misrepresentation, Securitized Mortgage, Class Action Securities Lawsuit, Robo-Signing Lawsuit, Lost Equity Litigation, Mortgage Lender Fraud, FINRA Fraud Lawsuit, Suing Banks, Fraudulent Misrepresentation, Short Sale Fraud, Fraudulent Business Practices, Mortgage Litigation, Complex Tort Litigation, Injunctive Relief, MERS Fraud

The Resolution Law Group: Professional Athletes, Celebrities Often Targeted for Securities Fraud

The Resolution Law Group PChas represented many athletes and other celebrities who lost millions because of improper handling of their investments. While overspending and poor investing are two common causes for these losses, the rich and famous also make easy targets for securities fraud, which is when our securities law firm steps in.

One reason for this is that many professional athletes and other people that have become famous are not prepared or well informed about how to manage their new wealth. This can make them easy prey for irresponsible or purposely negligent financial advisers.

“We listen to complaints daily about the mishandling of investors accounts,” said Geoffrey Broderick of The Resolution Law Group. “Yet, it is surprising even to me that financial firms and advisors would engage in financial wrongdoing that harms high-profile investors. Many ‘financial sociopaths’ have zero thought about others and, apparently, little concern for their own negative notoriety.”

Just recently, 30 NFL players, including wide receiver Terrell Owens, pursued a Florida broker over a casino project that resulted in over $40 million in losses. In February, ex-boxing heavyweight Mike Tyson filed a securities fraud lawsuit against his ex-advisor and financial advisory firm for allegedly pulling out over $300,000 from their accounts, causing him lose millions of dollars in income. In July, Mike Sweeney, the five-time MLB All-Star filed a securities case against UBS Financial Services (UBS) and his ex-broker there claiming he suffered about $7.6 million in losses.
Other Recent Securities Cases Involving Defrauded Pro Athletes (Investment News):
• FINRA awarded $1.46 million to NBA champion Horace Grant against Morgan Keegan & Co. over mortgage-backed securities and funds that lost up to 80% when the subprime market failed. Fund manager James Kelseo consented to pay $500,000 in penalties for allegedly inflating the securities’ value.

• Dozens of athletes, including NBA player Jason Terry and US Olympic soccer player Heather Mitts are suing SunTrust Bank (STI) and William Crafton Jr. over losses they sustained in a number of Ponzi scams.

Green Bay Packers’ Vince Young is embroiled in a securities case with financial adviser Ron Peoples and ex-agent Major Adams II over $5.5 million losses. He is alleging breach of fiduciary duty, unjust enrichment, breach of contract, and usury.

As our securities fraud law firm mentioned earlier, athletes are not the only celebrities to fall victim to negligent or greedy representatives. Actors Kevin Bacon, Kyra Sedgwick, and John Malkovich, film director Steven Spielberg, candidate and former New York governor and current NY City Comptroller Candidate Eliot Spitzer, and Dreamworks CEO Jeffrey Katzenberg are just some of the wealthy people that sustained losses in the Bernard Madoff Ponzi Scam.

Our securities lawyers work with investors that have sustained losses from securities fraud. We have helped thousands of clients recoup their losses sustained due to the negligence or errors of their financial representatives.  Please do not hesitate to email or call the The Resolution Law Group (203) 542-7275 for a confidential, no obligation consultation.

Lender Litigation, Unlawful Foreclosure, Tarp Money, Mortgage Backed Securities, Derivitives Lawsuits, Insider Trading Lawsuit, SEC Settlements, Ponzi Scheme Lawsuits, Intentional Misrepresentation, Securitized Mortgage, Class Action Securities Lawsuit, Robo-Signing Lawsuit, Lost Equity Litigation, Mortgage Lender Fraud, FINRA Fraud Lawsuit, Suing Banks, Fraudulent Misrepresentation, Short Sale Fraud, Fraudulent Business Practices, Mortgage Litigation, Complex Tort Litigation, Injunctive Relief, MERS Fraud

The Resolution Law Group: Judge Approves Creditor Vote on Jefferson County, Alabama’s Bankruptcy Plan

A US judge has paved the path for the creditors of Jefferson County, Alabama to vote on a plan to conclude what is being called the second biggest municipal bankruptcy in US history. Now, the county’s creditors—they are owed $4.2 billion—have until October 7 to vote.

Most of them have already agreed to the negiotiated plan, which would deliver just $1.735 billion to warrant holders of the county’s sewer system that are owed $3.078 billion. A deal has also been reached over non-sewer debt.

It will be up to US Bankruptcy Judge Thomas Bennett to look into a timeline that would wrap up Jefferson County’s bankruptcy. He is the one who approved the vote on the plan. If creditors the plan, it will need to be confirmed during a hearing that would take place in November.

The debt-reduction plan is based on a settlement reached between Jefferson County, and JP Morgan Chase & Co (JPM), hedge funds, and other creditors. The financial firm and the funds hold most of the $3 billion in sewer warrants. The county wants to cancel these and approximately $2 billion of new debt would replace them.

Per the plan, JPMorgan would get back 31% of the $1.22 billion owed to it. Several hedge funds would get over 80% of $872 million. Meantime, Jefferson County would up sewer rates of 7.4% a year for four years, susceptible to an increase if interest rates see one too.

As for warrant holders that are owed over $500 million and not included in the deal, they are allowed to vote either to collect 65 cents/dollar owed or, if they surrender the right to get money from insurers, they could get 80 cents for every dollar. The reductions in sewer warrants would be the first time investors of municipal bond in this country would be compelled to sustain losses on the principal they are owed because of a US bankruptcy case. Jefferson County’s bankruptcy is linked to a sewer refinancing marred by political corruption.

Unlike with corporate bankruptcies, creditors cannot seize or sell the county’s assets in a municipal bankruptcy and a trustee cannot be appointed. Recently, the city of Detroit, Michigan made national headlines when it filed the biggest municipal bankruptcy in the US to date and sought Chapter 9 protection. The city has about $18 billion in liabilities.

Please contact The Resolution Law Group if you believe you are the victim of institutional investor securities fraud. Our stockbroker fraud law firm represents corporations, financial firms, partnerships, banks, municipalities, retirement plans, school districts, large trusts, charitable organizations, high net worth individuals, and private foundations. Your case assessment with our securities lawyers is free.  Call the The Resolution Law Group (203) 542-7275 for a confidential, no obligation consultation.

Lender Litigation, Unlawful Foreclosure, Tarp Money, Mortgage Backed Securities, Derivitives Lawsuits, Insider Trading Lawsuit, SEC Settlements, Ponzi Scheme Lawsuits, Intentional Misrepresentation, Securitized Mortgage, Class Action Securities Lawsuit, Robo-Signing Lawsuit, Lost Equity Litigation, Mortgage Lender Fraud, FINRA Fraud Lawsuit, Suing Banks, Fraudulent Misrepresentation, Short Sale Fraud, Fraudulent Business Practices, Mortgage Litigation, Complex Tort Litigation, Injunctive Relief, MERS Fraud