Posts belonging to Category Mortgage Securities & Collateralized Debt Obligation Problems



Front-End Bonus Payments May Need To Be Disclosed

 

If your broker or financial adviser told you he was moving to another brokerage firm and asked you to move your account there, would you want to know if he was being paid thousands or millions of dollars to make the move?  The Financial Industry Regulatory Authority (FINRA) thinks so, and is proposing a new […]

OppenheimerFunds Pays $35 Million to Settle Charges

 

OppenheimerFunds  Inc. has agreed to pay more than $35 million to settle SEC charges that it  made misleading statements about two of its mutual funds during the credit crisis in late 2008.  The payments include a penalty of $24 million, disgorgement of $9,879,706, and prejudgment interest of $1,487,190. According to the SEC, Oppenheimer used total […]

CDOs Haunt UBS

 

Swiss banking giant UBS AG is reported to be engaged in settlement discussions with the U.S. Securities and Exchange Commission regarding its structuring and underwriting of an allegedly fraudulent mortgage bond deal.  The SEC has alleged that UBS defrauded clients that invested over $748 million in notes linked to a CDO known as ACA ABS […]

Wall Street Firms Scam Each Other

 

Citigroup, one bank that has been accused of scamming investors in CDO transactions, appears to have been scammed by another Wall Street Bank, UBS, that engaged in similar activity. The U.S. Department of Justice’s recent lawsuit against Standard & Poor’s has identified dozens of collateralized debt obligations (CDOs) that were allegedly given the highest AAA […]

Will Alternative Investments Fuel the Next Financial Debacle?

 

Investors are being sold more and more alternative investments and large broker-dealers are ramping up to supply that demand, according to the Wall Street Journal (“Alternatives Get a Boost”). The trouble is that most investors do not fully understand these products and their brokerage firm advisers do not fairly explain the risks and problems associated […]

JP Morgan and Credit Suisse Pay Over $400 Million to Settle Mortgage-Backed Securities Actions

 

The SEC has settled two mortgage-backed securities actions against J. P. Morgan Chase and Credit Suisse for over $400 million. The enforcement actions arose out more than $1 billion in losses by investors during the financial crisis. Critics say that the settlements are just a cost of doing business and will not deter similar Wall […]

Is Time Running Out on Criminal Prosecutions Against Wall Street ?

 

Federal prosecutors may be about to run out of time to file criminal charges against Wall Street participants for their role in the financial crisis. Charges for most federal offenses, including securities fraud, must be filed within five years of the offense, experts say. The subprime lending that played a significant role in the crisis […]

Wells Fargo Fined for Selling Unsuitable Investments to Municipalities and Non-Profits

 

Wells Fargo agreed to pay more than $6.5 million to settle SEC charges that it sold commercial paper backed by mortgage securities and collateralized-debt obligations to municipalities, nonprofit institutions and other customers without first understanding the substantial risks of those securities. The securities were unsuitable because the investors had a low risk tolerance. Three of […]

Wall Street Compensation Systems are the Roots of Many Evils

 

Could Wall Street’s role in creating the recent financial crisis boil down to something as simple as a conditioned reflex? Apparently so, according to William D. Cohan, a former investment banker. Cohen writes: Wall Street “rewards bankers and traders for the revenue they generate by constantly selling whatever comes across their desks, regardless of its […]

Bloomberg Article Lambasts the SEC

 

Former investment banker and financial writer William Cohan has written a blistering critique of the SEC’s settlement with former Bear Stearns hedge fund managers Ralph Cioffi and Matthew Tannin, essentially accusing the SEC of abject surrender to the forces of evil and begging the judge to reject the settlement: “We are all worse off for […]