Reuters uncovers a scoop, that there’s apparently a second-layer living will process, a secret one beyond the public living wills we know about. To refresh your memory, banks are required to fill out living wills that detail how they would be unwound in the case of a financial failure. The initial public living wills that [...]

The SEC managed to lose a layup of a case against former Citigroup executive Brian Stoker, in a case which revolved around CDO sales where Citi has already agreed to pay fines on the grounds that they misled investors and took the other side of the bet. The Securities and Exchange Commission had accused Brian [...]

Sandy Weill, the former CEO of Citigroup, became the latest unorthodox figure to endorse the concept of breaking up the mega-banks. Weill joins former and current Federal Reserve regional bank Presidents like Richard Fisher and Thomas Hoenig, as well as several academic conservatives. What’s even more unusual about Weill joining this chorus is the central [...]

Ben Hallman has an informative piece on who is starting to get relief from the foreclosure fraud settlement. The short answer, despite incentives to write down loans in the first year of the program, is not that many people. As part of the national mortgage settlement signed in March, five large banks — Chase, Bank [...]

I generally agree with Peter Henning that Eric Schneiderman’s plaintive wail for more resources for the RMBS working group, the task force looking into fraud in the mortgage securitization business, suggests that there will not be any meaningful prosecutions coming out of Washington against Wall Street. And he marshals a bunch of other evidence. [Schneiderman's] [...]

I have mentioned that we will see a wave of shareholder activism this spring, with direct action challenges to the biggest corporations in America. This outcome at the Citigroup meeting in Dallas is one of the first fruits of that plan. Citigroup‘s shareholders rejected the bank’s plan to award its chief executive, Vikram S. Pandit, [...]

Bad news for bank accountability. A three-judge panel of the 2nd Circuit Court of Appeals said today that the SEC would “have a strong likelihood of success” in getting a ruling of District Court Judge Jed Rakoff overturned. That ruling refused to allow a settlement in an SEC mortgage backed securities case against Citigroup to [...]

If anything, the foreclosure fraud settlement has shown a breakdown in the ability of regulatory agencies to deal with the aftermath of fraudulent conduct. They simply have no ability to offer a regulatory response that’s commensurate with the behavior. If the behavior does lead to a negotiated settlement, then it comes with unsatisfying “neither admit [...]

Housing Wire reports that we’re not going to see foreclosure fraud settlement terms until the end of the month, at best: The state attorneys general and federal prosecutors will likely file the actual $25 billion foreclosure settlement documents in court by the end of the month, according to a source familiar with the deal. The [...]

The Second Circuit Court of Appeals intervened in the ongoing fight between the Securities and Exchange Commission and a federal judge yesterday, when they granted a stay in a ruling in a mortgage backed securities case against Citigroup. The SEC confirmed Wednesday morning that the Second Circuit Court of Appeals granted a stay to the [...]

The federal judge presiding over the settlement of Citigroup with the SEC over deceiving investors on mortgage backed securities claims hammered the agency yesterday, questioning its enforcement decisions. “Doesn’t the S.E.C. have an interest in what the truth is?” Judge (Jed) Rakoff asked, in reference to the commission’s longstanding practice of not forcing a defendant [...]