Remember the financial crisis? That was because when push came to shove, there was no James Bond to diffuse these derivatives of mass destruction–none of the financial “innovators” who created them had any idea how they functioned. Fortunately the principles of the CFTC’s new rules are basic and protective.
Monthly Archives: February 2012
Promises, Promises, AT&T Customer Successfully Sues in Small Claims Court in California for Throttling of Data Speeds: Winning $850
Posted in In the CourtsCourageous AT&T customer Matt Spaccarelli had enough. More and more consumers are taking these matters into their own hands. Sounds a bit like Heather Peters and her battle with Honda. Even if Mr. Spaccarelli could have filed a class action, I bet he’s feeling better and surely has more money in his pocket by moving forward in small claims court.
A Day In Court: Lessons Learned About Modern Debtor’s Prison
Posted in Consumer ProtectionAs Mr. Dickens himself put it, “I was too cowardly to do what I knew to be right, as I had been too cowardly to avoid doing what I knew to be wrong.” Imprisonment for a private debt–I thought it was 2012? We know what’s right; it’s time to change in practice what we changed in the law almost a century and a half ago.
20 Times the National Average! CVS Pharmacies Look The Other Way Despite Soaring Demand for Oxycodone
Posted in Consumer ProtectionCorporations with the tools and whereabouts to detect the movements of America’s seedy underbelly should be encouraged to speak up and do what’s right. Surely that would be better than making a quick buck while we wait for an overworked and underpaid DEA to save the day.
Watering Down the Volcker Rule: The Disingenuousness of the Banking Industry While We Discussed the Rule’s Merits
Posted in Banks and Financial ServicesEvery time banks asked, “Well what do we do if X, Y, or Z happens,” a contingency was written into the rule. And when asked: “Hey, how is this going to be interpreted,” definitions and interpretations were spelled out. (Okay, maybe not every time. But how on earth did a plan as simple as “No risking taxpayer money on proprietary trading” reach 500 words, not to mention 500 pages?)
Regulating Credit Reporting Agencies and Debt Collectors: Richard Cordray and the CFPB Establish Some of Their Territory
Posted in Consumer ProtectionValuable to many and a safety net to millions more, predatory loans are around to stay. But good news: Our new friends at the Consumer Financial Protection Bureau–for the first time–will be taking a good hard look at what is legalized “loan sharking” and put a national enforcement strategy together for policing these practices.
Citibank to Pay $153 Million to Settle Yet Another Case of Wrongful Conduct: Thank You Sherry Hunt
Posted in WhistleblowersWe commend you Sherry Hunt. Management at CitiMortgage and possibly CitiBank put profits before ethics and the law, but you did not. You saw a crime being committed and you blew the whistle. You risked your job, and possibly a career in banking to simply do the right thing. If more people had your courage and tenacity, financial institutions would play by the rules. They would not have to be hit over the head with a 2×4 wielded by the U.S. Attorney’s Office.
Wells Fargo’s Credit Defense Program is Offensive
Posted in Banks and Financial ServicesThe latest that has come across my desk is something called Wells Fargo Credit Defense Service. No, it doesn’t really protect your credit; what would give you that idea? On the contrary, it exploits the fact that you have credit.
“The lady doth protest too much, methinks…” – Volcker Must Be On To Something
Posted in Banks and Financial ServicesIt will be okay, big guys. Investment banks will allow for the liquidity you supposedly so dearly fear losing. The market will adapt and the reduced risk in the U.S. financial system will restore confidence and integrity to the markets. The economy grew for decades under the Glass-Steagall Act. Would we really be upset to see that growth again–growth all can benefit from, not just traders?
$26 Billion Dollar Settlement of Mortgage Foreclosure Practices: It’s Not About the Money
Posted in Banks and Financial ServicesThe Department of Justice, HUD and State Attorneys General are sure proud to have reached a settlement with 5 banks (Bank of America, JPMorgan Chase, Wells Fargo, Citigroup, and Ally) over the abuses in real estate foreclosure practices that plagued homeowners and the banks themselves. Is the settlement a triumph or simply window dressing? I’d say somewhere in between – and thus the very definition of a “settlement”.
Shame on you Judge Rakoff: Slamming the Courthouse Door on Investors Who Were Sold “Crap” and “Pigs” by Deutsche Bank
Posted in In the CourtsSlamming the door on investors not only denies them a remedy; worse, it allows the Deutsche Banks of the world to avoid scrutiny, and you know where that ends. They will try it again and again knowing the courts have their back.
General Motors: A Phoenix Rising From the Ashes on the Taxpayers’ Dime
Posted in Banks and Financial ServicesFast forward to April 2010. GM triumphantly claimed that it had repaid its TARP loans ahead of schedule and with interest (well not exactly). It doesn’t take a math wiz to question how GW could go from bankruptcy to paying back the $49.5 billion they had received in TARP funds in just a year. Senator Chuck Grassley of Iowa was quick to pick up on that; GM shuffled its TARP funds, converting a portion of its debt into stock and viola, money (TARP money) was used to “pay back” the Treasury. (“Nice work down in accounting fellas”). In effect, taxpayers were just paid back with different TARP funds not robust earnings. Taxpayers get devalued stock and GM gets to claim it paid back the loans “in full”. But it could have been worse and tens of thousands of jobs were saved
The Two Sides of Carlyle’s Billionaire Founder David Rubenstein
Posted in Consumer ProtectionDavid Rubenstein. Here’s a guy who earned his money, and instead of buying yachts and sports teams and filling the gossip pages with lurid details of affairs with Hollywood stars (not that there is anything wrong with that), he has become a generous and often patriotic philanthropist… But sadly we learned that under Mr. Rubenstein’s watch, Carlyle tried to slip a provision into the company’s soon-to-be-filed IPO documents that would slam shut the courtroom doors to all Carlyle shareholders.
Heather Peters Wins $9,867 from Honda on Claims Her Civic Hybrid Ain’t Getting Promised Mileage Results
Posted in Consumer ProtectionHeather Peters’ victory should not only ring loudly in the halls of Honda’s Torrance, California headquarters, but also in every class action law firm in the country. You guys (including yours truly) must do better for consumers–or we will be replaced by the scrappy, take-no-prisoners, make-no-promises “Heather Peters” of the world.
DOJ Files Criminal Charges Against Credit Suisse Traders: What We Can Learn About Wall Street Bonuses
Posted in Consumer ProtectionCould there be a clearer rallying cry for regulation of Wall Street bonuses? Heck, John Dillinger only robbed banks of a few hundred thousand dollars over the course of his “career,” and they created the FBI to catch him.