Monday, August 13, 2012

Signs of robosigning in banks' credit card collections

Welcome to the morning roundup. Here's a look at what's news in banking and finance.

Credit card robosigning. Remember robosigning? Well, it's back. There are now signs that the practice exposed in mortgage foreclosures, where banks used false documents and employees signing hundreds of documents a day without reading them, has made it to credit card collections, The New York Times reports. Some judges say that as many as 90 percent of the lawsuits to collect debts they preside over use improper documentation.

Regulator hits big time. The financial system's smallest regulator, the Commodity Futures Trading Commission, is now in the spotlight as it investigates the Libor-rigging scandal, The New York Times says. Lawmakers say the agency was once "toothless," but it now has the respect of Wall Street.

Wells suit after child's cancer. A former Wells Fargo employee in Florida has sued the bank, claiming he was fired because of the cost of his young daughter's cancer treatments, the New York Daily News reports. Before he was fired, the man says the bank and its insurance company asked "numerous questions" about the girl's treatment plan. She died last year. Wells says the man was fired for improperly filling out time sheets.

Euro banks buying bonds. European banks are buying back their bonds -- which have fallen precipitously in value -- in order to record an accounting gain and boost profits, the Wall Street Journal reports. Critics say the moves hamper the banks' liquidity. The accounting gains are similar to the ones U.S. banks like Bank of America have recorded in recent quarters.


Anonymous said...

Nice scam by the eurobanks:

1. Cut interest rates so bond prices rise.
2. Sell bonds
3. Print money to kill value of bonds
4. Buy back bonds to lock in profit