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Old 03-26-2009, 01:05 AM   #1
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Default Sources: Extensive regulatory overhaul planned

AP - The Obama administration is proposing an extensive overhaul of financial regulations to increase oversight of such exotic instruments as credit default swaps that have been blamed for contributing to the worst financial crisis to hit the country in seven decades.




Sources: Extensive regulatory overhaul planned
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Old 03-26-2009, 12:08 PM   #2
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Well I hope everything will be alright especially in economic in our crisis...Hoping for their good plans
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Old 08-18-2010, 03:27 PM   #3
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SEC watchdogs goin' after New Jersey...

SEC sues New Jersey for fraud
August 18, 2010 -- The State of New Jersey agreed to settle fraud charges brought by the Securities and Exchange Commission Wednesday after it became the first U.S. state ever to be accused of violating federal securities laws.
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The SEC alleged that New Jersey mislead investors in bond sales totaling $26 billion over a six year period ending in April 2007. The state agreed to settle the case without admitting or denying the findings. The settlement did not involve a financial penalty. But the SEC did impose a "cease-and-desist" order against New Jersey and ordered the state to improve its financial disclosures.

According to the SEC, offering documents connected to a total of 79 bond sales created the false impression that the state could fund certain pension funds. In reality, the regulators said, New Jersey could not make contributions to the pensions without raising taxes or cutting services that could impact its budget.

As a result, investors were not given adequate information to gauge the state's ability to fund the pensions or assess the impact on its financial condition, according to the SEC. "The State of New Jersey didn't give its municipal investors a fair shake, withholding and misrepresenting pertinent information about its financial situation," Robert Khuzami, Director of the SEC's Division of Enforcement, said in a statement.

In response, New Jersey said the state has never missed a bond payment and stressed that the state is focused on improving its disclosures. "We aim to have the best disclosure of any state in the nation, and we intend to meet that goal in our bond offerings," said Andy Pratt, spokesman for the New Jersey Treasury.

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Old 09-27-2010, 10:51 PM   #4
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Crackin' down on the debt scammers...

New rules ban promises to cut your debt in half
September 27, 2010 -- New rules muzzling debt-settlement companies go into effect Monday, preventing these firms from making grandiose promises they have no intention of keeping.
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In the past, these for-profit telemarketing companies promised to renegotiate consumers' debt and even potentially cut it in half. They didn't warn customers, however, about the fees they would incur -- or that it could take years to see relief. That all changes Monday. Federal Trade Commission rules now require these debt settlement companies to be more upfront and honest about their services. That means they must disclose how much money customers will fork over and how long the settlement process will take. And they're no longer allowed to swear to cut your debt in half if they can't.

With more and more desperate consumers turning to these companies for help, consumers need to realize what they're really getting themselves into, said Evan Zullow, an attorney in the FTC's division of financial practices. The Association of Settlement Companies, one of the major industry organizations, estimated that as of June 2009 its members served about 154,000 active consumer clients and managed more than $4.9 billion in debt. That was up from 2008, when its members had 123,000 customers and managed $4 billion in debt.

Complaints of abusive and deceptive practices filed with the FTC have also risen, jumping 18% between 2008 and 2009. "Consumers have been led to expect that results are going to come much quicker and more easily than they do, and that draws them in and gets them to enroll," said Zullow. "So we want them to know how much money and time they are really going to have to invest to get those results."

No lying: While it may seem like a given, debt settlement companies are now banned from misrepresenting themselves. That includes saying the company is non-profit when it's really a for-profit or saying that it can eliminate a huge chunk of your debt when it doesn't have proof that it can do that. Ever seen a TV commercial where a debt settlement company promises it has saved its customers 30% to 65% of credit card debt? Well, they're only counting the customers that didn't drop out of the program, which isn't a fair representation since about 60% of customers end up ditching the program before it's over, said Zullow.

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Old 01-29-2011, 07:47 PM   #5
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Financial regulatory reform won't stop bailouts...

TARP Watchdog Casts Doubt on Financial 'Reform' Law's Promise to End Bailouts
Friday, January 28, 2011 - The use of TARP funds to provide a safety net for “too-big-to-fail” institutions is a “recipe for disaster” that can lead to more bailouts, according to a report by the TARP inspector general.
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Special Inspector General for TARP Neil Barofsky, in a quarterly report to Congress, said it “remains to be seen” whether the Wall Street Reform and Consumer Protection Act, sponsored by Democratic Sen. Chris Dodd and Rep. Barney Frank, will achieve its intended purpose of ending government bailouts. That's because big institutions still believe the government will bail them out, he said. In the report, Barofsky also blasted Obama’s Home Assistance Modification Program (HAMP), which -- as CNSNews.com previously reported -- has not achieved its intended purpose of bringing down foreclosure rates by helping struggling homeowners.

“TARP’s most significant legacy [is] the moral hazard and potentially disastrous consequences associated with the continued existence of financial institutions that are ‘too big to fail,’” Barofsky stated in the report. “The continued existence of institutions that are ‘too big to fail’ — an undeniable byproduct of former Secretary [Henry] Paulson and Secretary [Tim] Geithner’s use of TARP to assure the markets that during a time of crisis that they would not let such institutions fail — is a recipe for disaster,” noted Barofsky. “These institutions and their leaders are incentivized to engage in precisely the sort of behavior that could trigger the next financial crisis, thus perpetuating a doomsday cycle of booms, busts, and bailouts.”

Barofsky pointed out that the Dodd-Frank financial reform legislation falls short of solving the perception that the government will not allow an institution to fail because “the largest institutions continue to enjoy access to cheaper credit.” The inspector general noted that the intention of the Dodd-Frank legislation, which was signed into law by President Obama in July 2010, was in part, to end “too big to fail” and “to protect the American taxpayer by ending bailouts.”

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Old 07-01-2011, 12:46 AM   #6
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Fraudster gets his due...

Mortgage Exec Gets 30 Years for $3 Billion Fraud
Thursday, June 30, 2011 - An executive convicted of orchestrating a nearly $3 billion fraud as chairman of one of America's largest private mortgage companies was sentenced Thursday to 30 years in prison by a judge who accused him of showing no remorse.
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Federal authorities say the case against Lee B. Farkas, former chairman of Florida-based Taylor Bean & Whitaker, is one of the largest prosecutions arising from the nation's financial crisis. The fraud put thousands of employees out of work and contributed to the collapse of Colonial Bank, which authorities described as the sixth-largest bank collapse in U.S. history. "He deserves to be punished severely in light of the enormity of his crimes. The losses from this case are, in fact, off the charts," federal prosecutor Patrick Stokes said in urging a judge to send Farkas, 58, to prison for the rest of his life. "He has destroyed lives and institutions."

Farkas, who denied any wrongdoing when he testified at his trial, was convicted in April of all 14 counts, including securities fraud and conspiracy. On Thursday, he acknowledged taking risks and making errors in judgment to keep his company afloat. But did not directly apologize for any fraud. "When faced with the prospect of Taylor Bean & Whitaker sinking, I had to take risks," said Farkas, who was taken into custody following the verdict and appeared in court Thursday in a green prison jumpsuit. "I let Taylor Bean & Whitaker get out of control by letting it grow too fast." U.S. District Judge Leonie Brinkema told Farkas she detected no remorse as she sentenced him to 30 years - twice the 15-year sentence requested by his attorneys.

The fraud began in 2002 and took multiple forms until Taylor Bean collapsed in 2009 and the scheme unraveled, prosecutors said. Taylor Bean overdrew its main account with Alabama-based Colonial Bank by several million dollars and eventually double- and triple-pledged mortgages it held to a variety of investors. Prosecutors also alleged that Taylor Bean sold hundreds of million in worthless mortgages to Colonial. They say Farkas was motivated by a lavish lifestyle, maintaining several dozen classic cars, a private jet and seaplane and multiple houses, including one in Key West. Farkas, of Ocala, Fla., is the last of seven employees and executives from Taylor Bean and from Colonial to be sentenced. The other six cooperated with the government and agreed to testify against him in to secure lighter sentences for themselves.

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Old 07-22-2011, 07:50 PM   #7
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S&P skeptical of bailout ban...

‘Too big to fail’ bank law seen as too weak to work
Thursday, July 21, 2011 - A year after the enactment of a sweeping Wall Street reform law, evidence is growing that it failed in its main mission of ending taxpayer bailouts of global banks considered “too big to fail.”
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Despite an outright ban on bailouts written into the legislation, Wall Street investors and credit agencies remain skeptical that the government will not step in again to prevent any downfall of major banks such as Bank of America, Citigroup or JP Morgan. Those financial goliaths have only grown in size and power, making it more certain that they would bring down much of the financial system with them. The most concrete sign that the banks still enjoy an implicit guarantee from the government is that none of the top banks has been downgraded since the legislation was enacted, even though their high credit ratings for years have been based on the expectation that the government would prevent any catastrophic failure of the bank that would harm the bank’s creditors.

Standard & Poor’s Corp. last week pointedly disputed the often-stated claim on Capitol Hill that the legislation had put an end to “too big to fail” and the era of federal bailouts. S&P thinks “the government in a handful of situations may be forced to provide some sort of support to an institution,” especially if the failure of the bank threatens the economy and well-being of ordinary Americans, as occurred in the fall of 2008, said S&P managing director Rodrigo Quantanilla. S&P cited the long history of bank bailouts in times of economic stress as well as what it sees as ambiguities in the Wall Street reform law. The S&P may change its mind, depending on how regulations implementing the law turn out. Yet the agency is so skeptical of Congress’ resolve that it expects an amendment to the Wall Street reform law to remove any ambiguity and make it easier to bail out big banks.

“For us to change our views about whether the U.S. government remains supportive or not,” Congress would have to, among other things, require that bank creditors are forced to take losses if a bank makes mistakes that leads to its failure, Mr. Quantanilla said. Attempts to amend the law to include such language failed last year. Moody’s Investors Service also has defied the law’s authors by not downgrading any of the biggest banks, whose ratings depend on government support. It says, however, that it is reviewing whether regulations implementing the law would require a downgrade.

Rep. Barney Frank, Massachusetts Democrat, former chairman of the House Financial Services Committee and co-author of the law, blasted S&P for “clearly misreading” the law and said the agency’s assertion that the law is likely to be changed to permit bailouts shows that, in fact, the law accomplished what it set out to do. “Any fair reading of the mood of the American public and the appetite of Congress suggests that there is absolutely no support for more bank bailouts,” he said in a letter to S&P last week, adding that the credit agency should stop trying to predict what Congress will do and stick to its “core business” of assessing creditworthiness.

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Old 10-30-2011, 06:56 PM   #8
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Fat foxes guardin' the hen house collectin' their fat paychecks...

U.S. Gov't Financial Regulators Earn Tax-Funded Salaries of $225,000-Plus
October 25, 2011 – Federal employees at several financial regulatory agencies – including the new Consumer Financial Protection Bureau (CFPB) – are earning six-figure salaries and taking home bonuses up to $5,000, according to federal records obtained by Judicial Watch. At least 228 such regulators make $225,000 a year.
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In comparison, members of Congress make $174,000 a year; the Speaker of the House makes $223,500; and the majority and minority leaders pull in $193,400 a year. The records, obtained through the Freedom of Information Act (FOIA), show the number of employees at five of the six major financial regulatory agencies. In addition to the CFPB, the personnel documents come from Wall Street regulatory agencies including the Commodity Futures Trading Commission (CFTC), the Office of the Comptroller of the Currency (OCC), the Treasury Department, and the Securities and Exchange Commission (SEC). The forms reveal that hundreds of regulators earn in excess of $225,000 per year, not counting bonus income awarded by some of the agencies.

The CFPB – created by the 2010 Dodd-Frank financial regulation law – has hired a dozen employees at more than $225,000 per year, Judicial Watch reported on Tuesday. The massive new financial regulator has also hired a college student intern, paying her $42,036 per year, despite being listed as a “student trainee” in federal records. The CFTC has 26 employees earning at least $225,000 per year. That agency blocked out most of the data on the forms it released to Judicial Watch. It did not block out the amounts it paid in bonuses, however, revealing that it paid between $400 and $5,000 in cash bonuses to employees making $225,000 per year or more. The CFTC would not release the exact salaries of the employees to whom it gave bonuses but all of the records pertained to employees making $225,000 per year or more.

The OCC reported that it had 85 employees making $225,000 or more, but blacked-out the names of those employees as well as the reasons for paying them such high salaries. Typically, the agencies reported both the names of its highly paid employees and the legal authority that justified the high salaries. The Treasury Department reported only two high-salaried employees, choosing also to withhold their names. The SEC had the most high-salaried employees, reporting that they paid 103 employees salaries of $225,000 per year or more. In all, the financial agencies reported a total of 228 employees making $225,000 or more per year, not including bonuses.

The only financial regulator that refused to respond to the FOIA request filed by Judicial Watch was the Federal Reserve, which claimed that it did not use normal government personnel records. The Fed also did not provide Judicial Watch with the personnel records it said it did use. The documents, known as SF-50 forms, are government employment records that show how much employees earn in annual salary. “These new salary records are bound to cause controversy. No wonder Washington, D.C. is the wealthiest area of the country,” said Tom Fitton, president of Judicial Watch. “And the secrecy surrounding basic salary information of public employees shows an arrogance of power and contempt for transparency in an administration that promised the very opposite.”

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