Receiving Wide Coverage ...
Mortgage Settlement Checks to Be Mailed: Regulators announced yesterday that the first round of checks related to their $8.5 billion settlement with banks over alleged foreclosure processing mistakes will soon be in the mail. Many news outlets led with the stats. The Fed and the OCC "are set to dole out roughly $1.2 billion in the first batch of payments," Dealbook reports. "By April 12, the regulators expect to mail 1.4 million checks." Others focused on just how little the borrowers are actually getting. As the opening paragraph of the Wall Street Journal article notes, "The vast majority of borrowers … will get $1,000 or less apiece, a sobering coda to a protracted attempt to help those who may have been placed into foreclosure as a result of banks' mistakes." Or, as the American Banker headline summarizes, "Foreclosure Review Amounts to Peanuts for Most Borrowers." Regulators' attempts to address this issue have long been on the receiving end of criticism. American Banker readers will recall that the settlement replaced a "bungled" foreclosure review process that appeared to benefit consultants more than the involved homeowners. More big picture coverage on the soon-to-be mailed settlement checks can be found here: Bloomberg, Reuters
Small Biz Aid Got TARP-ed: Some small banks may need to explain after a report found they used "$2.1 billion in government cash intended to boost small-business lending to repay" Troubled Asset Relief Program funds instead, the Journal says. The report, completed by the special inspector general for TARP Christy Romero, isn't likely to do much for regulators' reputations. Per a quote from Romero in the Washington Post, "Treasury and the banking regulators did not adequately assess the plans, each claiming it was the responsibility of the other."
KPMG Update: More details are emerging about KPMG's rogue auditor problem. Recall, the auditing firm recently terminated a senior partner after discovering he had provided confidential information to a third-party. This partner, per various news outlets, is Scott London, who was in charge of overseeing audits at Skechers and Herbalife, the two companies KPMG is no longer representing as a result of the scandal. According to the Journal, London admits to passing on stock tips in exchange for "cash and gifts" starting "a few years back." He has not named the third-party recipient of the tips. Investigations are currently underway at the Federal Bureau of Investigation, U.S. Justice Department and Securities and Exchange Commission. New York Times, Washington Post
Wall Street Journal
Luxembourg has announced plans to "exchange information with the rest of the European Union about EU bank accountholders in the country as of Jan. 1, 2015."
Turns out U.K. Prime Minister David Cameron's support was irrelevant. Former HBOS chief Sir James Crosby "has asked for his knighthood to be removed" amid pressures from parliament following the release of a report that criticizes his performance during the bank's collapse. Crosby also stepped down from his role as senior independent director of food services company Compass. Now the attention turns to whether Crosby's successor Andy Hornby and former bank chairman Lord Stevenson will make similar gestures. The mounting pressures have led Lombard columnist Alison Smith to declare "rehab," not revenge, should be the fourth "r" of banking scandals. (Remorse, reimbursement and resignation being the other three.)
New York Times
Bank of America has hired Goldman Sachs' Luigi Rizzo "to become head of mergers and acquisitions for Europe, the Middle East and Africa."
According to this Dealbook article, Fannie Mae and Freddie Mac share prices have tripled over the past few months. "When zombie stocks show signs of life, you know you are in trouble," notes the author.
"Former Regulators Find a Home With a Powerful Firm." If you can immediately name that firm — Promontory Financial Group — and you're experiencing some déjà vu right about now, it's probably because you read this profile by American Banker's Maria Aspan and Jeff Horwitz a few weeks ago.