Tag: Bank of America

This very well could be the most important Slabbed post of the year…

And it has nothing to do with Jefferson Parish Political Corruption.

For literally years our good friend Mr CLS has been methodically hammering away at the complexities surrounding insurance securitization and the implications of such for each and every one of us, especially those of us on the coast being price gouged for wind coverage. So suppose you’re a reporter with insurance beat responsibilities like Becky Mowbray, Anita Lee, Jeff Amy, Paige St John, Beatrice Garcia or a national outfit like Bloomberg that has done some quality coverage on insurance issues that is ready to kick it up a notch in terms of understanding.  What is now coming to light with Bank of America’s alleged forced placed insurance fraud is a must read as more turds float to the surface in the global insurance finance cesspool.

Some of the very same problems could very well exist in other facets of the securitized insurance market; problems the folks at U Penn Wharton School no doubt did not conceive of when they were pioneering insurance linked securities such at Catastrophe Bonds not long ago as the reasons for the lack of market transparency in the global insurance markets come into sharper focus.

Don’t look for the political shoe shine boys for big insurance such as the coast’s own Steven Palazzo or Commish Mike Chaney to say much on this.  Both men, despite paying lots of lip service to the topic of insurance, remain firmly, purposely ignorant of the any fraud perpetrated by their big business buddies on Wall Street.

sop

From the Cerebral Wing of the Slabbed Nation: President Obama, The Peter Principle, Crooks and Liars.

New York Times columnist Frank Rich has encapsulated literally years of posts here on Slabbed regarding the financial crash of 2008 and explains why Team Obama is regarded as an utter failure by the American public.  As a reader commented via email to me with the link, (this column is) “Something that you could have authorship of.”  Rich lays out the case both against Team Obama and Team GOP.  The bottom line is Wall Street owns the GOP 100% and the Dems about 85%. What a great choice we have as the wealthy elites continue to drain the treasury dry and run the country further in debt. Here are a few snippets:

The reasons for his failure to reap credit for any economic accomplishments are a catechism by now: the dark cloud cast by undiminished unemployment, the relentless disinformation campaign of his political opponents, and the White House’s surprising ineptitude at selling its own achievements. But the most relentless drag on a chief executive who promised change we can believe in is even more ominous. It’s the country’s fatalistic sense that the stacked economic order that gave us the Great Recession remains not just in place but more entrenched and powerful than ever.

No matter how much Obama talks about his “tough” new financial regulatory reforms or offers rote condemnations of Wall Street greed, few believe there’s been real change. That’s not just because so many have lost their jobs, their savings and their homes. It’s also because so many know that the loftiest perpetrators of this national devastation got get-out-of-jail-free cards, that too-big-to-fail banks have grown bigger and that the rich are still the only Americans getting richer.

This intractable status quo is being rubbed in our faces daily during the pre-election sprint by revelations of the latest banking industry outrage, its disregard for the rule of law as it cut every corner to process an avalanche of foreclosures. Clearly, these financial institutions have learned nothing in the few years since their contempt for fiscal and legal niceties led them to peddle these predatory mortgages (and the reckless financial “products” concocted from them) in the first place. And why should they have learned anything? They’ve often been rewarded, not punished, for bad behavior. Continue reading “From the Cerebral Wing of the Slabbed Nation: President Obama, The Peter Principle, Crooks and Liars.”

Thank God for Arizona Part 3: Blaming the surge in drug violence on the Mexicans. God damn the pusher man (and his U.S. banker).

But now we live in debased times,
Sans punishment to fit our crimes
Our moral compass has got lost,
Or on the rubbish heap been tossed.
As in this cautionary tale of bankers,
Who came to look like social cankers.

You will all know the basic story,
In all its venal details, gory.
Of how a bunch of peerless clowns
Despite degrees – from Yale to Brown –
Behaved like schoolboys in the lab,
When teacher’s gone to smoke a fag……..

Their attitudes were so repulsive
The public backlash grew convulsive,
And dimly seeing that their wages
Just might be threatened by these rages,
Self-interest prompted some to say
“We’re sorry” – in a muted way. Continue reading “Thank God for Arizona Part 3: Blaming the surge in drug violence on the Mexicans. God damn the pusher man (and his U.S. banker).”

Even a zealous advocate might perceive that such an argument hints at hypocrisy

Oh, how I wish I could report the judge who said that was one of our own.  Maybe someday soon I’ll be able to do just that- but the story of the moment  is Rakoff’s back!

It’s a new year, but so far, the same old (sad) song continues to play for Bank of America in the courtroom of Manhattan federal district court Judge Jed Rakoff, who’s overseeing the Securities and Exchange Commission’s suit against the beleaguered bank. On Monday, Rakoff ruled that BofA cannot present expert testimony asserting that media reports should have alerted shareholders to the billions it planned to pay Merrill Lynch executives after the 2008 merger. Continue reading “Even a zealous advocate might perceive that such an argument hints at hypocrisy”

What Can Happen When One Honest Judge Takes on a Giant Corporation

Justin Maxon / The New York Times
Justin Maxon / The New York Times

Bam Bam readers know my feelings about this great man, Judge Jed S. Rakoff, a federal district court judge in Manhattan. Because Judge Rakoff’s bench is located at the epicenter of corporate greed on planet earth, he’s uniquely positioned to effect real change. It would be so easy to give in to Citigroup, Bank of America, Goldman Sachs and their pack of vampire lawyers who’ve damn near bankrupted the best government system humankind ever conceived.

The case in Judge Rakoff’s court is SEC v. Bank of America (BofA). A month ago, SEC and BofA concocted a phony settlement proposal and wheeled it out to Judge Rakoff. The SEC agreed to drop its case against BofA and its sub Merrill Lynch, which admitted no wronging, and close the investigation forever, if BofA paid the nano fine of $33 million. Judge Rakoff sniffed out the fraud, called them out, and refused to approve the so-called “settlement.” This sent the thieves and their lawyers into a tizzy. Rakoff wanted facts, names and dates concerning why BofA and Merrill concealed material facts on giant exec bonuses from shareholders, lied in certified proxy statements filed under SEC law, and purposefully understated Merrill Lynch’s financial condition by $20 billion. All this occurred in connection with BofA getting federal bail out funds, used by BofA to purchase Merrill last year. The BofA tab at present = $45 BILLION.

BofA and its New York power lawyers decided to dig in, invoke lawyer-client privilege, and lock the court out of critical documents. Congress jumped in and called for hearings, looking for a quickie PR boost with BofA shareholder/voters . (See previous Slabbed post on Edolphus Towns’ committee hearings).

Last Friday something tangible happened. The Board of Directors of BofA voted to abandon the lawyer-client privilege argument and cooperate in providing information. Continue reading “What Can Happen When One Honest Judge Takes on a Giant Corporation”

Judge Jed Rakoff Wakes Up Congress

Those of you who have followed the Judge Rakoff posts are keenly aware that Bank of America (“BOA”) is up shit creek. Not only did it lie in a certified proxy statement filed under SEC law, it looks a lot like BOA purposefully understated Merrill Lynch’s financial condition by $20 billion. All of this was done in connection with a request for federal bail out funds, used by BOA to purchase Merrill last year. None of this would probably matter if BOA wasn’t in court before Judge Jed S. Rakoff.

Judge Jed Rakoff, a great American judge, rejected a phony-assed settlement agreement BOA and the corrupt SEC tried to float by him last week, and told them he wanted names and dates of the fraudulent activities. BOA is scrambling to keep the information secret, claiming attorney-client privilege among other things. Bam Bam readers en garde! There is no privilege when an attorney assists someone in committing or planning to commit, fraud. See Rule of Evidence 502. Don’t ever let anyone tell you different.

Well now Jed Rakoff has thumped Congress out of its slumber, and shamed it into action.

A House panel called the Committee on Oversight and Government Reform has told BOA that it cannot use attorney-client privilege in refusing to answer questions about the BOA-Merrill deal. Chairman Edolphus Towns wants BOA to reveal information that could affect Judge Rakoff’s case and the New York AG’s investigations into the BOA scandal. Continue reading “Judge Jed Rakoff Wakes Up Congress”

Wall Street paternalism and disconnect at it’s finest and on display. A Skadden partner writes about shareholder ignorance and displays plenty in the process.

I’ve written a series of posts on the disconnect from reality between the Wall Street fantasy land and Main Street, which has made modern day Wall Street possible. The problem is systemic in my opinion, from trade publications like the National Underwriter whose editor in chief believes spending yet more money on public relations is the answer to bad faith insurer claims handling, to their trade groups and shills like Robert Hartwig that try to convince the fleeced taxpaying public that insurers really didn’t screw people here after Katrina. As is his custom, however, it was Mr CLS who gives us almost more googling to do than time but in this instance a post of his on Yahoo Allstate provided me the catalyst to author this post which will illustrate again the disconnect of which I speak and it is there we begin:

sop, check out the “Winners” of the 4th Annual U.S. Securitization Awards…….

Don’t know what happened to the 5th Annual U.S. Securitization Awards, guess they cancelled and took “the 5th”.

The links he gave listing the winners was 404, no doubt broken on account of the financial crisis but undaunted I did a quick search and found them. This of course resulted in one of those patented Ah Ha moments for me but before I connect the paternalistic dots lets examine some of those that Wall Street honored back in April 2008 at the 4th annual U.S. Securitization Awards:

Deal of the Year: IHOP Corp./ Applebee’s International Securitization. Underwriter: Lehman Brothers

Deal of the Year – CMBS: Equity Office Properties Securitization Financing. Underwriters: Bear Stearns, Goldman Sachs and Bank of America

Deal of the Year – CDO: Genesis CLO 2007-1 and Genesis CLO 2007-2. Underwriters: Genesis 2007-1: CDO manager: Ore Hill Partners, Underwriter: Deutsche Bank. Genesis 2007-2: CDO manager: Levine Leichtman Capital Partners, Underwriter: Deutsche Bank

ABS Firm of the Year: Goldman Sachs

Outstanding Contribution Award: The American Securitization Forum / Dept. of the Treasury

As if these ironies aren’t delicious enough the final one is over the top.

Lifetime Achievement Award Recipient: C. Thomas Kunz, Retired Head of Structured Finance, Skadden, Arps, Slate, Meagher & Flom

We are well familiar with State Farm’s main US based law firm Skadden, Arps, Slate, Meagher & Flom from their great work revising the history of the Katrina litigation planting falsehoods such as the oft repeated meme that Jim Hood used his criminal investigation of State Farm to assist Dickie Scruggs in cramming the first big settlement down State Farm’s throat (with help of ignorant bloggers such as Mississippi’s own Tom Freeland  who still repeats such propaganda on occasion despite reams of contemporaneous press reports to the contrary). Our readers will also no doubt recall I once lamented the impact of layoffs at Skadden on our daily readership earlier this year.

While reading the award winners and the Skadden connection to the toxic paper industry (makes one wonder how much work the boys at Skadden did on State Farm’s Merna Re) a recent post on Greenbackd came to mind that featured the work of Skadden partner John Carney who evidently is in charge of shilling for the firm and it is to the Greenbackd post we go next: Continue reading “Wall Street paternalism and disconnect at it’s finest and on display. A Skadden partner writes about shareholder ignorance and displays plenty in the process.”

Why men like Judge Jed S. Rakoff should matter to us

judge_190
Justin Maxon / The New York Times

“We’re a nation of laws, not men.” Thus sayeth John Adams, verily coining America’s lofty definition of “the rule of law.” I hate to tell John but we’re a flawed nation, founded on poetic promises of fairness and objectivity we’re wholly incapable of delivering. If we were truly “a nation of laws, and not men,” who would care what judge got assigned to hear your case? The judge is just a law vendor right, a person who matches facts that the jury decided, with the right mix of law. Why should it matter then which judge you got? And what about those instances where judge A rules for plaintiff, and with nothing more than a new judge, the outcome flips. Is the law so loosey goosey that it’s like jello, it can apply both ways, merely because a different set of eyes applied it?

If we’re truly “a nation of laws, and not men” then why would corporations go the trouble of “purchasing” our judges, governors, legislators, members of congress, senators and so on? State Farm “purchased” a judge and put him on the Illinois Supreme Court to reverse Avery v. State Farm, a billion dollar consumer fraud case. Massey Coal “purchased” a pimp judge in West Virginia and installed him on their Supreme Court to reverse a $50 million dollar verdict against it. Right now, Senator Max Baucus holds our health care fate in his hands yet big insurance “purchased” him with $3 million in campaign cash. If we’re really “a nation of laws, and not men,” all these corporate predators are they’re wasting their money, and all the lobbyists can park their cash wheelbarrows for good.

Take the situation in our own Supreme Court. One of the judges elected to the Court received the unheard of sum of $2.2 million in campaign funds. He was elected as a tort reformer, pledging allegiance to big insurance, big medical, big pharma, etc. After the election, he showed up as a guest of the notorious insurance shill, Robert Hartwig, at a big insurance confab.

Let’s examine what happened next at Mississippi Supreme Court. Alex Alston, an esteemed senior member of the Mississippi bar who’s practiced on both sides had this to say:

During the past 4 1/2 years, according to my research, an astonishing 88 percent of all jury verdicts in favor of the wronged victims have been reversed by the state Supreme Court. Continue reading “Why men like Judge Jed S. Rakoff should matter to us”

Anyone else remember that Federal Judge that actually lives up to his oath of office

judge_190
Justin Maxon / The New York Times

I sure do as the blogger who would become known as Bam Bam Bigelow authored the post on him for Slabbed late last month. Yesterday Judge Jed S. Rakoff lowered the boom on both Bank of America and the captured (and toothless) regulators at the Securities and Exchange Commission. Nowdy, I sure do miss that SEC employee who had plenty of time to come here and trash the Rigsby sisters back in 2008 before George Bush and his band of idiots had to vacate DC taking their political hacks with them. After all what was evidently more important at the SEC in 2008 than trashing whistleblowers? It sure as hell wasn’t regulating these companies that took us all to the verge of bankruptcy last year.

The New York Times has the story with a hat tip to Professor Russ Abbott who was kind enough to link our earlier coverage. Welcome to slabbed Russ:

As President Obama traveled to Wall Street on Monday and chided bankers for their recklessness, across town a federal judge issued a far sharper rebuke, not just for some of the financiers but for their regulators in Washington as well.

Giving voice to the anger and frustration of many ordinary Americans, Judge Jed S. Rakoff issued a scathing ruling on one of the watershed moments of the financial crisis: the star-crossed takeover of Merrill Lynch by the now-struggling Bank of America.

Judge Rakoff refused to approve a $33 million deal that would have settled a lawsuit filed by the Securities and Exchange Commission against the Bank of America. The lawsuit alleged that the bank failed to adequately disclose the bonuses that were paid by Merrill before the merger, which was completed in January at regulators’ behest as Merrill foundered. Continue reading “Anyone else remember that Federal Judge that actually lives up to his oath of office”

Here’s a judge who took an oath of office, and lives up to it. An anonymous guest post.

judge_190
Justin Maxon / The New York Times

The judges name is Jed S. Rakoff, and he “sits” in the US District Court of Manhattan.  He’s a man I could address as “Your Honor,” and sincerely mean it.  He isn’t shy about stating that the public must be able to “see” what our court system is doing if they are to have any confidence in it at all.  He’s adopted strict rules limiting what sort of materials may be kept confidential in cases before him.  He calls this “transparency,” but what he’s really saying is this . . . every time a court does something under the table, (like sealing State Farm’s documents without any basis whatsoever), it demeans the justice system and destroys people’s belief in their government. 

We all know how corporate defendants constantly game the system with their pseudo “trade secret” claims.  Good God, think of the horror stories posted on this blog alone.  Sadly, these shameless lies presented in signed court papers governed by Rule 11 honestly standards are rarely subjected to the mandatory test for excluding discoverable information: (1) the movant has the burden of proving everything they withheld is a bona fide trade secret; and (2) a record finding must be made, based on facts and/or testimony, and the controlling law in discovery cases; and (3) all of this must be preserved in a public court record, susceptible to appellate review. 

Contrast Judge Rakoff’s “transparency” with what happened in Birmingham, corporate rat’s nest of the South.  Not only were documents concealed, hell, the entire case against Cori and Keri Rigsby was ginned up to keep evidence of federal flood program fraud a secret, and at the same time persecute and defame the Rigsbys and Dick Scruggs as document thieves.  Imagine that.  What would people like Oliver Wendell Holmes and Benjamin Cardozo do if they were alive to witness an Article III Tribunal, a United States Federal Court involved in this sordid and illegal mess?  Imposing personal jurisdiction over persons not even within the court’s constitutional power . . . for the purpose of concealing a multi billion dollar fraud upon the US Treasury? Continue reading “Here’s a judge who took an oath of office, and lives up to it. An anonymous guest post.”