Imagine that

Banks making shit up!

US credit card companies have been churning out lawsuits and improperly collecting debt from consumers 90 percent of the time, at least according to a New York judge who deals with these cases.

Lawsuits produced by credit car companies to recoup unpaid bills often rely on inaccurate documents, incomplete records and generic testimonies from witnesses who repeatedly testify, the New York Times reported. The companies often sue clients for more money than is owed.

“I would say that roughly 90 percent of the credit card lawsuits are flawed and can’t prove the person owes the debt,” said Brooklyn civil court judge Noach Dear. The judge told the Times he sees as many as 100 such cases a day.

By “robo-signing” documents, banks “robotically” mass-produce similar papers for different clients, without properly reviewing them. In the process some of the papers get falsified.

Lenders often try to collect money from clients who have already paid their bills. Other times, they increase the lenders’ debt by unfairly adding fees and erroneous interest costs.

Some clients claim they don’t owe anything, but most disagreements come from credit card companies conflicting with clients about how much is rightfully owed. But in 95 percent of lawsuits, the credit card companies win – even though the lawsuits sometimes include falsified credit card statements produced years after the borrowers fell behind on payments.

A former JPMorgan Chase employee admitted that nearly 23,000 delinquent accounts had incorrect balances.

Taryn Gregory said she was sued by Discover for more than $7,000 in credit card debt, even though she had only accumulated $4,000. Upon examining the lawsuit, the Times found that the documents said they were produced in 2004, even though the advertisements on the bottom of the page were from 2010.
American Express borrower Felicia Tancreto was sued for $16,000. She admitted having fallen behind on payments, but contested owing that much. After attending court, the judge dismissed the lawsuit for lack of evidence.

But in most cases, the borrowers do not attend court, causing the lenders to win 95 percent of the time.

Not so brilliant, after all

Chris Whalen on Jamie Dimon:

What is really interesting is that the legal complaint filed by Schneiderman talks about sloppy procedures for loan selection, but still does not get to the real fun, namely multiple pledges of loans for different RMBS. And you can be sure that Schneiderman does not really want to go that far because it might force him to ask the same question about the other, far larger issuers of RMBS.

Remember, the whole point of the Robo-signing settlement is not consumer protection, but rather fraud. The key question: Who’s got the note? If you don’t have to deliver the note into an RMBS trust, then the door is wide open for securities fraud.

What is really troubling is that while Schneiderman is making a big fuss about suing JPM over the Bear Stearns RMBS, he refuses to go after Bank of America, Wells Fargo, Citi, Ally and other large banks for precisely the same type of fraud and deliberate criminal acts as were committed by Bear Stearns. The degree of negligence and stupidity displayed at Bear Stearns may have been more egregious than that at say Countrywide, but only in degree.

Once again it is shown that the politicians like Schneiderman, who have aspirations for higher office, have no problem making an example of a small firm, but will never move directly against the top four banks for their own grotesque errors and omissions.

Schneiderman has been dragging his feet with respect to Countrywide and Bank of New York for years, yet suddenly he has time to sue JPM over Bear Stearns? What’s wrong with this picture?
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Here comes winter

I guess I should start stocking up if we’re going to have a bad winter:

Expect temperatures 6 degrees colder than last winter’s, and a six-fold increase — or more — in snowfall.

In short, if Accu-Weather’s winter outlook turns out to be right, the coming season will be whole lot more like a typical winter than in 2011-12.

In the forecast released this morning, an update and elaboration of an earlier outlook, the commercial weather service in State College, Pa., is calling for near-normal temperatures this winter, with above-normal snowfall.

In addition, Accu-Weather believes Philadelphia will have an above-average number of days — perhaps seven — with snowfall of an inch or more, said long-range forecaster Paul Pastelok. Last season, it had exactly one.

The revised snow-outlook map sees the above-average snow zone extending from Philadelphia on south and west.

To the north, long-range forecaster Paul Pastelok says snowfall might not be terribly generous along the New England coast because Atlantic Ocean sea-surface temperatures up that way are well above averages.

Nazis gaining in Greece

This is, after all, how Hitler did it. Make people desperate enough, and they’ll grasp at anything:

Greece’s political barometer for September has revealed that 54 percent of Greeks do not trust any political party. The measure of the popularity of political parties has shown a dramatic swing in favour of Golden Dawn (Chrysi Avgi).

Whilst politicians are held in low regard and more than half of Greek citizens are so disillusioned with the political process that 54 percent no longer trust any political party, there are a few notable changes in the political landscape.

A report in shows that the popularity of the the ultra-nationalist Golden Dawn has risen 10 points since May, winning the party a popularity score of 22 percent. Moreover, their share of the vote as evidenced in polls for September, now stands at 13 percent.

They bring good things to life

Boy, this pisses me off. This is the company of Jeff Immalt, the head of Obama’s jobs council, which is supposed to figure out how to foster job growth – in America. He’s famous for closing plants, laying people off and cutting wages and benefits — and then moving operations to other countries:

General Electric Co. (GE) is refinancing $5 billion of debt even as it expects to generate $100 billion of cash in the next four years, showing confidence in its ability to invest at returns four times its borrowing costs. The biggest maker of power-generation equipment sold $7 billion of bonds yesterday at an average 2.58 percent yield in the parent company’s first issue in almost five years. That compares with a 12 percent return that Chief Executive Officer Jeffrey Immelt said last week the Fairfield, Connecticut-based firm generates on its capital.

The offering allows the company to use the cash it brings in for stock buybacks, dividends and acquisitions. While Immelt seeks to pare debt at GE’s finance arm, the offering may boost bonds of the parent by 22 percent to $11 billion next year.

“It’s a no-brainer,” Jody Lurie, a corporate credit analyst at Janney Montgomery Scott LLC in Philadelphia, said in a telephone interview. “It costs nothing to issue, so why would they use cash on hand” to pay off maturing obligations?

GE borrows at lower rates than the average for U.S. investment-grade issuers, whose bond yields dropped to an unprecedented 2.85 percent yesterday, according to Bank of America Merrill Lynch index data. That compares with 2.62 percent for GE, which includes yields on obligations of its finance arm GE Capital.

See if you can guess how that happened!

General Electric, the world’s largest industrial company, has quietly become the biggest beneficiary of one of the government’s key rescue programs for banks.

At the same time, GE has avoided many of the restrictions facing other financial giants getting help from the government.

The company did not initially qualify for the program, under which the government sought to unfreeze credit markets by guaranteeing debt sold by banking firms. But regulators soon loosened the eligibility requirements, in part because of behind-the-scenes appeals from GE.

As a result, GE has joined major banks collectively saving billions of dollars by raising money for their operations at lower interest rates. Public records show that GE Capital, the company’s massive financing arm, has issued nearly a quarter of the $340 billion in debt backed by the program, which is known as the Temporary Liquidity Guarantee Program, or TLGP. The government’s actions have been “powerful and helpful” to the company, GE chief executive Jeffrey Immelt acknowledged in December.

GE’s finance arm is not classified as a bank. Rather, it worked its way into the rescue program by owning two relatively small Utah banking institutions, illustrating how the loopholes in the U.S. regulatory system are manifest in the government’s historic intervention in the financial crisis.

Jeff Immelt is also one of the people pushing for the Grand Bargain. Isn’t that nice that someone so compassionate is looking out for us?

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