06 jun: Europa/aktier: ECB-meldinger overskygget af positiv stemning
07 jun: USA/aktier: Håb om stimuli giver største stigning i 2012
06-06-2012 18:55:00

BofA Suit vs. Deutsche Bank, BNP Paribas Dismissed

Relateret indhold
Relateret debat
17 nov - 
Det vidst kun i den offentlige sektor der er vækst, men..
15 nov - 
Bankerne er jo ikke velgørende institutioner. Det er en..
15 nov - 
Dem du taler om, er de selskaber NovaBank i TV om sønda..

A federal judge dismissed Bank of America Corp.'s (BAC) lawsuit against units of Deutsche Bank AG (DB, DBK.XE) and BNP Paribas SA (BNP.FR, BNPQY), a win for the two foreign banks in their $1.75 billion dispute over losses suffered when a subsidiary of disgraced mortgage lender Taylor Bean & Whitaker Mortgage Corp. collapsed.

Judge Robert W. Sweet of the U.S. District Court in Manhattan dismissed Bank of America's suit alleging negligence and breach of fiduciary duty against the securities units of BNP Paribas and Deutsche Bank for their role in the sale of notes issued by Taylor Bean's Ocala Funding unit.

Judge Sweet, in a 39-page opinion, said Monday that the units, acting as brokers in the sale of the Ocala notes, owed "no duty...to investigate or verify representations" made in a private placement. Judge Sweet also allowed the two banks to amend their suit against Bank of America to pursue additional claims against Bank of America, based on the bank's claims that fraud at Taylor Bean absolved it of liability.

Representatives for the three banks weren't immediately available for comment.

Deutsche Bank's and BNP Paribas's mortgage units were investors in notes issued by Taylor Bean's Ocala Funding unit, a mortgage conduit. Deutsche Bank and the BNP Paribas subsidiary sued Bank of America, which served as trustee for the notes, in 2009 for breach of contract over the bank's alleged failure to secure $1.75 billion in cash and mortgage loans on their behalf.

The Bank of America suit had looked to turn the tables on the two big Wall Street banks by suing BNP Paribas Securities Corp. and Deutsche Bank Securities Inc., which had arranged the sales in which their affiliates invested.

At the center of this legal morass was the Ocala Funding LLC conduit, a mortgage-financing vehicle that Taylor Bean created in 2005 to purchase its home loans, which were then bundled into securities and sold to investors such as Freddie Mac (FMCC). Ocala funded its business by issuing short-term notes that it sold to investors.

The Ocala conduit was a key element in a seven-year, multibillion-dollar fraud orchestrated by Taylor Bean founder Lee Farkas, which also brought down Taylor Bean's main lender, Alabama's Colonial Bank.

When Taylor Bean's mortgage assembly line collapsed in the summer of 2009, those involved--the banks, investors and the Federal Deposit Insurance Corp.--pointed fingers at one another, each claiming to have been injured by conduct of others.

Bank of America said that the FDIC, as Colonial's receiver, is on the hook for the $1.75 billion in losses investors suffered when Taylor Bean and Colonial collapsed. It sued the FDIC in the autumn of 2010.

The FDIC, which argued that the bank didn't have the authority to sue it over losses incurred by the Taylor Bean subsidiary, countersued. That dispute is pending.

Farkas's fraudulent scheme involved Colonial "purchasing" mortgage loans from Taylor Bean that had already been sold to other investors. In this way, Taylor Bean masked its financial problems and maintained its licenses as mortgage lender, seller and, importantly, issuer of mortgage-backed securities. Colonial provided the lender with $3 billion in mortgage financing, much of which went through Ocala.

Taylor Bean collapsed after federal regulators uncovered evidence of fraud and suspended its authority to make loans insured by the government agencies.

Farkas, a Florida businessman who built Taylor Bean from a small mortgage company into the largest U.S. mortgage lender that wasn't owned by a bank, is serving a 30-year prison sentence for his role in the scheme. He is appealing his conviction. A handful of other executives from Colonial and Taylor Bean have also been sentenced to prison for their roles in the fraud.

Write to Patrick Fitzgerald at patrick.fitzgerald@dowjones.com.

(END) Dow Jones Newswires

June 06, 2012 12:55 ET (16:55 GMT)

Copyright (c) 2012 Dow Jones & Company, Inc.

Opret kommentar

Relateret debat

  • 1 uge
  • 1 måned
  • 1 År
Ingen indlæg

Fondsbørsmeddelelser

Danske Bank: Danica åbner for milliardinvestering i veje og broer

06-12-2016 15:48:32
Når fremtidens broer, veje og tunneler skal bygges, skal staten i højere grad sætte sig på bagsædet og lade private aktører stå i spidsen.Det fastslog transport..

Novo sætter loft over listeprisstigninger i USA

06-12-2016 13:10:12
Novo Nordisk sætter et loft over sine forhøjelser af listepriserne på medicin. Fremover vil prisstigninger højst være encifrede.Det fremgår af et åbent brev, so..

Aktier/middag: Vestas til bunds i stille marked

06-12-2016 11:41:17
Der er tirsdag middag en lille kurslussing til Vestas i det danske eliteindeks, som ellers ligger nogenlunde fladt.Stemningen er afventende frem mod blandt ande..

Mest læste nyheder

  • 24 timer
  • 48 timer
  • 1 uge
1
Novo sætter loft over listeprisstigninger i USA
2
Statoil/CEO: Oliemarkedet vil vende hurtigere end ventet
3
Tirsdagens aktier: Kurslussing til Vestas trak C20 i minus
4
Europas største biotekselskab kan få endnu en bejler - citat
5
Aktier/middag: Vestas til bunds i stille marked

Relaterede aktiekurser

Bank of America Corporat.. 22,16 1,5% Stigning i aktiekurs
BNP Paribas Act.A 58,15 5,2% Stigning i aktiekurs
Deutsche Bank AG 18,29 9,8% Stigning i aktiekurs
Bank of America Corporat.. 22,09 57,8% Stigning i aktiekurs

Køb- og salgsanbefalinger

  • Trend
  • Pengemaskinen

Copyright Euroinvestor A/S 2016  Disclaimer Privatlivspolitik
Aktieinformation leveres af Interactive Data.
Data er forsinket 15-20 minutter iht. de enkelte børsers regler om videredistribution.
 
6. december 2016 22:48:05
(UTC+01:00) Brussels, Copenhagen, Madrid, Paris
Version: LiveBranchBuild_20161205.1 - EUROWEB1 - 2016-12-06 22:48:05 - 2016-12-06 22:48:05 - 1 - Website: OKAY

Når du besøger Euroinvestor.dk accepterer du, at der anvendes cookies, som vi og vores samarbejdspartnere benytter til funktionalitet, statistik og markedsføring. Læs mere om cookies på Euroinvestor.dk her

x