JPMorgan Chase & Co. has quietly ceased filing lawsuits to collect consumer debts around the nation, dismissing in-house attorneys and virtually shutting down a collections machine that as recently as nine months ago was racking up hundreds of millions of dollars in monthly judgments.
Jerry Salzberg, a lawyer who represents debt collectors and banks in the Chicago area, was familiar with Chase’s dismissed Illinois collections attorneys, whom he describes as experienced, productive and profitable.
“Someone from New York brought in the three lawyers, kicked them out with no warning and dismissed all their cases,” Salzberg says.
“These were people who were by the book. …If they weren’t the most profitable [of Chase's regional collection teams], they sure as hell were making a lot of money for the bank.
…Obviously something happened.”
Chase collections cases have dropped off sharply in Illinois in recent months, in addition to disappearing in five other states, an American Banker review indicates.
The review focused on California, Florida Maryland, New York and Washington, where local court records are electronically searchable.
After recouping $405 million in the first quarter of 2011, Chase’s recoveries fell to $321 million in the second quarter and $266 million in the third quarter.
It is not clear why Chase is walking away from billions of dollars of claims, but the number is likely to climb as word gets out that Chase is climbing out of the ring. Source: http://www.chasechase.org/ —————
10,000 Lawsuits Against Chase
10K Filing Discloses 10K Lawsuits
Chase is defending more than 10,000 legal proceedings, the bank revealed in its 10-K filing with the Securities and Exchange Commission on February 28, 2011.
It may be $4.5 billion short in reserves to cover the costs in a worst-case scenario, the bank said.
The lawsuits range from individual actions against JPMorgan Chase to class actions with “potentially millions” of litigants to regulatory/gov’t investigations.
The suits include common law tort and contract claims, statutory antitrust claims, securities claims and consumer protection claims, the bank reported.
If Houdini could conjure one lawyer to represent all the plaintiffs in each case and persuade all the lawyers to attend one humongous settlement conference, here’s how the line would look on the courthouse lawn:
“In view of the inherent difficulty of predicting the outcome of legal proceedings, particularly where the claimants seek very large or indeterminate damages, or where the matters present novel legal theories, involve a large number of parties or are in early stages of discovery, the Firm cannot state with confidence what the eventual outcome of the currently pending matters will be, what the timing of the ultimate resolution of these pending matters will be or what the eventual loss, fines, penalties or impact related to each pending matter may be.”
FHFA sues Chase for $33 billion
17 banks sued for $196 billion on September 2, 2011
The Federal Housing Finance Agency (FHFA), as conservator for Fannie Mae and Freddie Mac, filed lawsuits against 17 financial institutions, certain of their officers and various lead underwriters.
The suits allege violations of federal securities laws in the sale of residential private-label mortgage-backed securities to Fannie Mae and Freddie Mac.
Complaints have been filed against the following lead defendants:
JPMorgan Chase & Co. – $33 billion
The Royal Bank of Scotland Group PLC – $30.4 billion
Countrywide Financial Corporation – $26.6 billion
Merrill Lynch & Co. – $24.8 billion
Deutsche Bank AG – $14.2 billion
Credit Suisse Holdings (USA), Inc. – $14.1 billion
Goldman Sachs & Co. – $11.1 billion
Morgan Stanley – $10.6 billion
HSBC North America Holdings, Inc. – $6.2 billion
Ally Financial Inc. f/k/a GMAC, LLC – $6 billion
Bank of America Corporation – $6 billion
Barclays Bank PLC – $4.9 billion
Citigroup, Inc. – $3.5 billion Nomura Holding America Inc. – $2 billion
Societe Generale – $1.3 billion
First Horizon National Corporation – $883 million
General Electric Company – $549 million
The complaints are available on the FHFA website.
The SEC Systematically Destroyed Evidence
Crooks in all the wrong places – the heat rises…
From Matt Taibbi’s article in Rolling Stone August 17, 2011
Much has been made in recent months of the government’s glaring failure to police Wall Street; to date, federal and state prosecutors have yet to put a single senior Wall Street executive behind bars for any of the many well-documented crimes related to the financial crisis.
Indeed, Flynn’s accusations dovetail with a recent series of damaging critiques of the SEC made by reporters, watchdog groups and members of Congress, all of which seem to indicate that top federal regulators spend more time lunching, schmoozing and job-interviewing with Wall Street crooks than they do catching them.
As one former SEC staffer describes it, the agency is now filled with so many Wall Street hotshots from oft-investigated banks that it has been “infected with the Goldman mindset from within.”
The destruction of records by the SEC, as outlined by Flynn, is something far more than an administrative accident or bureaucratic #####-up.
It’s a symptom of the agency’s terminal brain damage.
Somewhere along the line, those at the SEC responsible for policing America’s banks fell and hit their head on a big pile of Wall Street’s money – a blow from which the agency has never recovered.
“From what I’ve seen, it looks as if the SEC might have sanctioned some level of case-related document destruction,”
says Sen. Chuck Grassley, the ranking Republican on the Senate Judiciary Committee, whose staff has interviewed Flynn.
“It doesn’t make sense that an agency responsible for investigations would want to get rid of potential evidence.
If these charges are true, the agency needs to explain why it destroyed documents, how many documents it destroyed over what time frame and to what extent its actions were consistent with the law.”
The system is broken.
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