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Batchelder Properties

Realtor serving all of Siskiyou County; Offering Reanl Estate and Property Management in Mout Shasta, Yreka, Weed, Dunsmuir, and Lake Shastina

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Payback Time at Last (But No Jailtime)

Since the global financial crisis, the world’s largest banks have agreed to pay close to $60 billion in fines just to the U.S. Department of Justice for creating and selling toxic mortgage-backed investments.

These don’t include the tens of billions that the banks have also paid in connection with lawsuits from investors or other federal agencies.

The web of complex mortgage-based financial products they created are largely to blame for creating the global financial crisis of 2007 and 2008, which ultimately led to the Great Recession.

A majority of that money will go directly towards programs designed to help homeowners and borrowers. Here’s a breakdown of some of the biggest banks and their settlements with the Justice Department in the last few years, ordered from oldest to newest:

  • JP Morgan (JPM) – $13 billion (2013)
  • Citigroup (C) – $7 billion (2014)
  • Bank of America (BAC) – $16.7 billion (2014)
  • Goldman Sachs (GS) – $5.1 billion (2016)
  • Morgan Stanley (MS) – $3.2 billion (2016)
  • Deutsche Bank (DB) – $7.2 billion (this week)
  • Credit Suisse (CS) – $5.3 billion (this week)
  • The fines were the result of investigations into widespread fraud and abuse in the mortgage market and were pursued by multiple U.S. government agencies.
  • The DoJ has said that the banks packaged poor-quality mortgages into investments and sold them to clients globally. When the mortgages soured, investors lost billions.
  • “Abuses in the mortgage-backed securities industry helped turn a crisis in the housing market into an international financial crisis,” said Benjamin Wagner in 2013, when he was the U.S. Attorney for the Eastern District of California.
  • But these settlements don’t paint the whole picture. Banks have also paid out billions more to settle other mortgage-related lawsuits from that period.
  • For example, Bank of America paid nearly $12 billion in 2012 to help settle lawsuits over wrongful foreclosures.
  • Earlier this year, Wells Fargo (WFC) agreed to pay $1.2 billion for shady mortgage lending practices between 2001 to 2008. This deal was also settled with the Justice Department.

 

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Batchelder Properties

16726 Middlecoff Rd.
Weed, California 96094

Email : info@batchelderproperties.com

Bruce Batchelder :
Rentals & Property Management
CA BRE lic. #01336594
Call Bruce at : 530-598-1586

Sally Batchelder :
Real Estate Sales
CA BRE lic. #01336776
Call Sally at : 530-938-0385

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