Regulator sues two big banks

by MPA21 Aug 2015
A federal regulator is suing two of the country’s biggest banks for hundreds of millions in a mortgage-backed securities case.

The Federal Deposit Insurance Corp. (FDIC) is suing CITIgroup and U.S. Bank for the over $695 million it lost from selling mortgage-backed securities once owned by a now-defunct Texas bank, according to Reuters.

The FDIC acted as receiver for Guaranty Bank in Texas, which purchased almost $3 billion of the securities.

The regulator alleges the banks failed to properly underwrite the loans and many of them had to be bought back. The securities were issued from 2005 to 2007 and sponsored by two banks now owned by JP Morgan Chase and Bank of America Corp., respectively.

According to Reuters, the FDIC has reached $1.83 billion in settlements over MBS sold to banks it has taken into receivership.


  • by Lynda J. Folk | 8/22/2015 10:18:56 PM

    Don't forget to get OCWEN/American home mortgage/Lend America ie; Ideal mortgage bankers. The banks failed to properly underwrite the mortgages and many of them had to be bought back. The securities were issued from 2005 to 2007.
    All fraudulent underwriting, All brought to fraudclosue court, having NO jurisdiction? ALL these homes STOLEN, they NEVER had a true leg to stand on.

  • by Mark Feenstra | 8/23/2015 8:46:35 AM

    If the goverment hikes intrest rate it going to have a negative impact on the economy
    As china's economy is in the tank
    The combination of these two events would be catastrophic for the US

  • by LDTX | 8/25/2015 3:08:00 PM

    Seriously!!! Bank of America, Bank of New York Mellon, America's Wholesale Lender A Corporation CWABS 2007-2
    All of this in 2007 and Bank of America just foreclosed on my property without proof that America's Wholesale Lender "A Corporation"
    under New York Law!! haa, This Corporation doesn't even exist under Texas Law. No Corporation exist. The Banks are making money had over fist stealing these properties back and reselling them. They don't even own these houses. How can you have 8 Certificate holders in 2008 and file a form 15 with the SEC saying there is not enough certificate holders to report to the SEC? Crooks, Criminals!!!


Should CFPB have more supervision over credit agencies?