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According to the Collins English Dictionary 10th Edition fraud can be defined as: "deceit, trickery, sharp practice, or breach of confidence, perpetrated for profit or to gain some unfair or dishonest advantage".[1] In the broadest sense, a fraud is an intentional deception made for personal gain or to damage another individual; the related adjective is fraudulent. The specific legal definition varies by legal jurisdiction. Fraud is a crime, and also a civil law violation. Defrauding people or entities of money or valuables is a common purpose of fraud, but there have also been fraudulent "discoveries", e.g. in science, to gain prestige rather than immediate monetary gain
*As defined in Wikipedia

Friday, May 3, 2013

Injustice Complete--for Goldman Sachs's Litton Servicing

A few comments about the article from which the excerpt below comes:

1.  Combining both banks' compensation for improperly foreclosing on homeowners nicely hides the amounts that each bank will pay.  (Nice cover, Goldman!)  I'm sure the banks are happy that the writer kept those amounts hidden combined too;

2.  $247 million (two banks combined) for 224,000 borrowers is an insult to the borrowers;

3.  "to compensate borrowers who may have been mistreated"--Such desperation:  the banks choose to pay those not mistreated?  Absurd!

4.  The status of the homeowners was not properly reviewed (or sloppily reviewed at best) and when the reviews were found to take too long and be too costly, they were just halted before any results were reached;

5.  For banks like Goldman Sachs, it is easy to throw money at a problem or to pay a small fine for fraud than to properly underwrite or review their borrowing methods and standards.  Appallingly, the regulators go along with that;

6.  Fraud is always more lucrative than taking the time to follow ethical guidelines; guidelines and ethics have been stripped away along with de-regulation;

7.  Litton Loan Servicing LP did not have a good reputation as a servicing company before Goldman bought the company;

8.  All the banks got a better deal (by paying a fine rather than doing business ethically) than the homeowners who were foreclosed on;

9.  There will never be enough money to resolve the harm that the banks caused.  That harm was exactly predicated upon the frauds that were perpetrated to achieve huge profits for the bank--forging documents on foreclosed homeowners, foreclosing on military members and committing accounting control fraud;

10.  It is disgusting that a government and the Justice System will settle for the payment of fines for fraud in lieu of real investigation and prosecution that should have included both Goldman executives and Litton executives.  Corruption reigns!

Goldman Sachs and Morgan Stanley Set Foreclosure Accord Payments
By Jesse Hamilton - Bloomberg
Goldman Sachs (GS) Group Inc. and Morgan Stanley (MS) will start sending checks to borrowers foreclosed on by the banks’ former mortgage-servicing units this week, according to the Federal Reserve.

The two New York-based banks will pay $247 million to almost 224,000 borrowers, the Fed said today in a statement. The checks -- meant to compensate borrowers who may have been mistreated in foreclosures during 2009 and 2010 that relied on improper documentation or faulty procedures -- range from $300 to $125,000, depending on the how much harm may have been done.

Mortgage units owned by Goldman Sachs and Morgan Stanley foreclosed on homes of 49 military members eligible for borrower protections and three homeowners who weren’t in default, the Fed said. The loans were handled by Goldman Sachs’s Litton Loan Servicing LP and Morgan Stanley’s Saxon Mortgage Services Inc., both of which were sold to Ocwen Financial Corp. (OCN)

Read the rest of the article here


Laser Haas said...

Let's see - that's about $1000 per foreclosure.

Yep - that'll fix - EveryThin!

Joyce R said...

I'm with you, Laser. The money is not going to fix anything least of all the fraud that took place during foreclosures.

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