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Excerpt: "Goldman Sachs has agreed to a settlement worth $1.2bn (�723m) to resolve a US regulator's claims the bank sold Fannie Mae and Freddie Mac faulty mortgage bonds, the regulator announced on Friday."

Goldman Sachs execs Lloyd Blankfein and Gary Cohn. (photo: Vanity Fair)
Goldman Sachs execs Lloyd Blankfein and Gary Cohn. (photo: Vanity Fair)


Goldman Sachs to Pay $1.2 Billion for Selling Faulty Mortgages to Fannie and Freddie

By Reuters

23 August 14

Regulator Federal Housing Finance Agency finds bank sold faulty bonds to Fannie Mae and Freddie Mac

oldman Sachs has agreed to a settlement worth $1.2bn (�723m) to resolve a US regulator's claims the bank sold Fannie Mae and Freddie Mac faulty mortgage bonds, the regulator announced on Friday.

Under the settlement with the Federal Housing Finance Agency, the conservator for the two government-controlled mortgage finance companies, Goldman Sachs said it agreed to pay $3.15bn (�1.9bn) to repurchase mortgage-backed securities from Fannie and Freddie.

The FHFA, which valued the settlement at $1.2bn, said the accord "effectively makes Fannie Mae and Freddie Mac whole on their investments in the securities at issue."

The $1.2bn reflects the amount that Goldman will pay, minus the estimated current value of the securities being bought back from Fannie and Freddie.

The deal averts a trial on 29 September in a pair of lawsuits against Goldman that the FHFA filed in 2011 as it sought to recover damages from various financial institutions behind some $200bn (�120.6bn) in mortgage bonds bought by Fannie and Freddie that later went sour.

To date, the FHFA has resolved all but three of the 18 lawsuits it filed, recovering $17.3bn (�10.4bn) through cases against banks including Bank of America Corp, Deutsche Bank AG and Morgan Stanley.

The FHFA's primary case against Goldman Sachs accused the bank of misleading the two mortgage finance giants in the sale of over $11.1bn (�6.7bn) in mortgage-backed securities sold to Fannie and Freddie from 2005 to 2007.

Goldman Sachs denied the allegations, and in the settlement did not admit wrongdoing. Under the settlement, Goldman Sachs will pay about $1bn (�603m) to Fannie Mae and $2.15bn (�1.3bn) to Freddie Mac, the FHFA said.

Goldman Sachs in a statement said the costs of the deal were substantially covered by its litigation reserves as of the second quarter of this year.

"We are pleased to have resolved these matters," Gregory Palm, Goldman's general counsel, said in a statement.

The deal tops a $550m (�332m) settlement that Goldman Sachs reached with the US Securities and Exchange Commission to resolve charges over how it marketed a subprime mortgage product in 2010.

The US department of justice continues to investigate Goldman Sachs over its marketing of mortgage-backed securities. The justice department announced on Thursday a $16.65bn (�10bn) settlement with Bank of America over mortgage securities.

The FHFA continues to litigate against three other banks: HSBC Holdings, Nomura Holdings and Royal Bank of Scotland Group.

HSBC continues to face its own trial on 29 September, while Nomura's case would go to a jury on 26 January.

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+44 # DongiC 2019-06-27 13:25
What was especially jarring was that several candidates (like Warren and Castro) showed clear signs of compassion and courage. Furthermore, they were organized and coherent and not disposed to rant and rave. I can't see any future for the Democratic Party with people such as these in leadership positions.
 
 
+11 # Jim Young 2019-06-27 23:57
Quoting DongiC:
...Furthermore, they were organized and coherent and not disposed to rant and rave...


Imagine that, organized and coherent in English and Spanish. They can talk about so many issues, diplomacy,match ing the rest of the developed world in affordable and effective healthcare for everyone (including those that endanger us, too, if their health fails epidemically). Imagine rebuilding alliances with civilized nations (instead of murderous predatory regimes just for the arms profiteers). It will take a while to see on all the solutions and variations they are ready to methodically implement and fine tune. They talk to each other, and the real people (in multiple languages).

Individual 1's other languages
are Wrestler-mouth Tauntanese/Twit terese, Pidgin Lawyerese, and Locker Room Talk,"
 
 
+6 # Robbee 2019-06-28 08:35
last nite biden drew the short straw!

ho got lined-up on the same stage with kamala!

as robbee recalls -

"Kamala Harris Announces Plan to Fine Companies That Pay Men More Than Women
By Chelsea Janes, The Washington Post
20 May 19

"it's against my religion to play bookie or dump on a candidate outstanding in her own right, but -

"i believe kamala would make a fine veep for bernie!

"i also believe kamala will be biden's kryptonite!, biden's waterloo!"
 
 
+8 # CenterLefty 2019-06-28 10:03
 
 
+10 # Robbee 2019-06-28 09:41
story idea - now that dickhead is building a (sea) wall around mar-a-lago, to protect illegal migrant employees from climate change, does mexico have to pay for it?
 
 
+2 # DongiC 2019-06-28 18:27
Robbee, Your sarcasm is vintage. Carry on!
 

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