Corruption has played a starring role in the history of financial institutions.
Corruption is likely to cause inefficiency when assets are used inappropriately. When corruption occurs within an bank organization, unflattering media coverage typically follows, which may result in customers losing trust in its business practices and products. This is a three-part series on corrupt banking practices in Texas and throughout the USA…
You should understand that our financial system is not merely corrupt in practice. It is corrupt by design – and the problem is growing.
Bankruptcy contemplates the “forgiveness” of debt. The Bible, likewise, contains debt forgiveness laws. Under U.S. law, a debtor may only receive a discharge of debts in a Chapter 7 bankruptcy once every eight (8) years. Under Biblical law, the release of debts came at the end of seven (7) years.
“At the end of every seven years you shall grant a release of debts. And this is the form of the release: Every creditor who has lent anything to his neighbor shall release it; he shall not require it of his neighbor or his brother, because it is called the LORD’s release” (Deuteronomy 15:1-2).
The Bible refers to debt as a type of bondage: “…the borrower is a slave to the lender” (Proverbs 22:7). Thus, the debtor is a slave to the creditor. Interestingly, the Bible declares, at the end of the sixth year: “…in the seventh year you shall let [your Hebrew slave] go free from you. And when you send him away free from you, you shall not let him go away empty-handed; but you shall supply him liberally from your flock…” (Deuteronomy 15:12-14).
Connect the dots, using news items from the past:
The latest sweetheart deal
Four of the world’s biggest banks pleaded guilty to felony charges this week, agreeing to pay roughly $5.6 billion in fines for fixing the price of currencies on the foreign exchange market. Justice Department officials made much of the fact that, unlike previous sweetheart deals with Wall Street, this one required the banks’ parent companies to enter a guilty plea.
That’s an improvement over previous deals. But it’s not as significant as it might have been, since the settlement wasn’t finalized until the banks were able to strike side agreements with regulators to ensure they’d be able to keep doing business as usual.
One of the institutions involved in this deal was Citigroup. That’s the bank whose self-written and self-serving “Citigroup amendment” passed Congress last December, a move which made it the target of an epic Elizabeth Warren takedown.
Another was J.P. Morgan Chase. Chase CEO Jamie Dimon was lionized for far too long by politicians and members of the mainstream media, many of whom insisted that Dimon was smarter and more ethical than his peers. There is now a considerable body of evidence to contradict that assertion – and it keeps on growing.
All four banks of these banks are repeat offenders with long records of serial fraud, as even this outdated graphic shows.
In a related development …
A fifth bank, UBS, was forced to give up a deferred prosecution deal as a result of its involvement in currency exchange fraud. In “deferred prosecution” agreements the Justice Department agrees not to prosecute a bank for crimes it has committed, if it keeps a promise not to commit those crimes again. It was not clear whether this would lead to any real-world consequences for the bank, however.
In yet another related development, Bank of New York Mellon Corporation agreed this week to pay $180 million to settle a foreign exchange-related class-action lawsuit. This followed a $714 million settlement for writing pension funds and other institutional clients by overcharging them for currency transactions.
J.P. Morgan Chase – again
This one seemed to slip through under the public’s radar. In a development that will trigger severe déjà vu for anyone who’s been following the big banks’ foreclosure scandals, the serially criminal J.P. Morgan Chase agreed on March 3 to pay more than $50 million over “robo-signed” documents – that is, documents which the bank fraudulently submitted to courts in mortgage-related hearings.
Swift v BancorpSouth Settlement
If You Paid Overdraft Fees to BancorpSouth Bank, You May Be Eligible for a Payment from a Class Action Settlement.
A federal court authorized this website. This is not a solicitation from a lawyer. Source
Update (10/21/16): Credit issuance to Settlement Class Members who have current BancorpSouth accounts and check issuance for Settlement Class Members who no longer have a current BancorpSouth account commenced on October 21, 2016.
A $24 million Settlement has been reached in a class action about the order in which BancorpSouth Bank (referred to as “BancorpSouth”) posted Debit Card and ATM transactions to customer Accounts, and the alleged effect the posting order had on the number of Overdraft Fees charged to Account holders. BancorpSouth maintains that there was nothing wrong with the posting process it used and that it complied, at all times, with applicable laws and regulations and the terms of the account agreements with its customers.
Certain current and former holders of BancorpSouth consumer checking Accounts are eligible for a payment or Account credit from the Settlement Fund.
A “Notice of Pendency of Class Action” was mailed and/or emailed to all Class Members in May 2013. You are included in the Settlement Class if you received a copy of the Pendency of Class Action sent in May 2013 and did not previously opt out before the Court-ordered deadline. The current Notice is intended to inform the same group of Class Members of the proposed Settlement of the case.
|Summary of Your Legal Rights and Options in this Settlement|
|Receive a Payment or Account Credit||If you are entitled under the Settlement to a payment or Account credit, you do not have to do anything to receive it. If the Court approves the Settlement and it becomes final and effective, and you remain in the Settlement Class, you will automatically receive a payment by check or Account credit.|
|Exclude Yourself from the Settlement||Receive no benefit from the Settlement. This is the only option that allows you to retain your right to bring any other lawsuit against BancorpSouth about the claims in this case.|
|Object||Write to the Court if you do not like the terms of the Settlement.|
|Go to a Hearing||Ask to speak in Court about the fairness of the Settlement.|
|Do Nothing||You will receive any payment or Account credit to which you are entitled and will give up your right to bring your own lawsuit against BancorpSouth about the claims in this case.|
BancorpSouth Overdraft Settlement
PO Box 3719
Portland, OR 97208-3719
NOTICE: This website provides a summary of the Settlement and is provided for informational purposes only. In the event of any discrepancy between the text of this website and the original text upon which it is based, the text of the original document shall prevail.
Questions? Contact the Settlement Administrator at 1-800-420-2916 or by email at firstname.lastname@example.org
On Wednesday, BancorpSouth, Inc. BXS agreed to settle the lawsuit for $10.6 million under which the bank was being sued for encouraging discriminatory mortgage lending practices. The settlement agreement was entered with the U.S. Department of Justice (“DOJ”) and the Consumer Financial Protection Bureau (“CFPB”).
The bank was accused for violating the Fair Housing Act and Equal Credit Opportunity Act. Both DOJ and CFPB investigated BancorpSouth’s lending practices initiating in 2014 in the Memphis area as well as in parts of neighboring Mississippi and Arkansas and concluded that the bank used racial criteria to direct potential borrowers towards certain neighborhoods and determined their eligibility for loans. We note that, as per the DOJ, such discriminatory practice is referred as ‘redlining’.
Moreover, regulators revealed BancorpSouth evaded areas with large African-American and Hispanic populations by refraining from opening branches or allocating those areas to loan officers. It has been notified that BancorpSouth was involved in predatory lending practices providing overcharged (higher fees and interest rates) loans to minority borrowers.
Awaiting the U.S. District Court’s approval in Northern District of Mississippi, the bank will be paying around $10.6 million, including about $4 million as loan subsidy with a penalty amount of $3 million. Further, the settlement includes payment of $2.78 million to black consumers who were illegally denied or overcharged for their loans and $800,000 for community programs and credit repairs.
“BancorpSouth’s discrimination throughout the mortgage lending process harmed the people who were overcharged or denied their dream of homeownership based on their race, and it harmed the Memphis minority neighborhoods that were redlined and denied equal access to affordable credit,” CFPB Director Richard Cordray said in a statement.
BancorpSouth neither accepted nor denied the wrongdoings and disagreed with the accusations saying “the decision to settle was to avoid prolonged and distracting litigation.”
“We believe this settlement is a positive development for the bank, and is in the best long-term interest of our customers, employees, and shareholders,” James D. Rollins III, chairman and chief executive of BancorpSouth, said in a statement. “BancorpSouth is fully committed to fair and responsible lending practices in all communities throughout our footprint. Our settlement is a testament to that commitment.”
Notably, the bank has already reserved $13.8 million during the first quarter of 2016 to meet such settlements, and therefore further financial impact is not anticipated.
Among other mortgage lenders – Citigroup Inc. C, JPMorgan Chase & Co. JPM and Bank of America Corp. BAC were also sued for discrimination in lending practices. Deutsche Bank AG had also been previously accused by Los Angeles of letting the foreclosed homes in low-income regions deteriorate to poor conditions. The case was settled in Jun 2013.
For banks, legal headwinds are on the rise. They continue to face several cases and probes regarding their business conduct preceding the financial crisis. Though the banks have resolved many such issues in the past years, increasing legal hassles keep dragging their financials downward.
Currently, BancorpSouth carries a Zacks Rank #3 (Hold). Source
BancorpSouth fined $10.6 million for discriminatory lending, redlining
BancorpSouth will pay $10.6 million to settle charges against the bank by the Department of Justice and the Consumer Financial Protection Bureau, which accused the Mississippi-based bank of redlining and discriminatory lending practices.
According to a joint release from the CFPB and the DOJ, the agencies accused BancorpSouth of a number of discriminatory practices, including illegally redlining in Memphis; denying the mortgage loan applications of certain African-Americans more often than similarly situated non-Hispanic white applicants; charging African-American customers more for certain mortgage loans than non-Hispanic white borrowers with similar loan qualifications; and implementing an “explicitly discriminatory loan denial policy.”
The $10.6 million settlement stems from investigations into the bank’s lending practices that began in 2014.
According to the CFPB and DOJ, part of the CFPB’s investigation into BancorpSouth included sending testers to several BancorpSouth branches to inquire about mortgages. The agencies say that the results of those tests support the allegations against BancorpSouth.
“The agencies allege that, in several instances, a BancorpSouth loan officer treated the African-American tester less favorably than a white counterpart,” the CFPB and DOJ said in the release.
“Specifically, the complaint alleges that BancorpSouth employees treated African-American testers who sought information about mortgage loans worse than white testers with similar credit qualifications,” the agencies continued. “For example, BancorpSouth employees provided information that would restrict African-American consumers to smaller loans than white testers.”close dialogStay ahead of the market withDaily UpdateAround the clock coverage and information about the US mortgage and housing industrySign UpNo thanks
According to the CFPB, this is its first use of testing, sometimes called “mystery shopping,” to support an allegation of discrimination.
If approved by the United States District Court for the Northern District of Mississippi, as part of the settlement, BancorpSouth will pay $4 million in direct loan subsidies in minority neighborhoods in Memphis; at least $800,000 for community programs, advertising, outreach, and credit repair; $2.78 million to African-American consumers who were unlawfully denied or overcharged for loans; and a $3 million penalty to the CFPB.
“BancorpSouth’s discrimination throughout the mortgage lending process harmed the people who were overcharged or denied their dream of homeownership based on their race, and it harmed the Memphis minority neighborhoods that were redlined and denied equal access to affordable credit,” said CFPB Director Richard Cordray.
“Today’s action is a reminder that redlining and overt discrimination are not yet remnants of the past, and that federal enforcement is needed to bring real relief to communities and individuals,” Cordray added. “The Consumer Bureau and the Department of Justice will continue working together to root out discrimination in the marketplace and ensure consumers receive fair and equal treatment under the law.”
According to the agencies, the charges against BancorpSouth included allegations that the bank:
- Illegally redlined in Memphis: The complaint alleges that from at least 2011 to 2013, BancorpSouth illegally redlined in the Memphis area—the market from which the bank received the most applications—by structuring its business to avoid and discourage consumers in minority neighborhoods from accessing mortgages. Specifically, the agencies allege that the bank placed its branches outside of minority neighborhoods, excluded nearly all minority neighborhoods from the area it chose to serve under the Community Reinvestment Act, and directed nearly all of its marketing away from minority neighborhoods. As a result, BancorpSouth generated relatively few applications from minority neighborhoods as compared to its peers.
- Discriminated in underwriting certain mortgages: The agencies also allege that one of BancorpSouth’s lending units discriminated against African-American applicants by denying them mortgage loans—including loans with consumer as well as business purposes—more often than similarly situated white applicants. Specifically, the agencies allege that BancorpSouth granted its employees wide discretion to make credit decisions on mortgage loans. This discretion resulted in African-American applicants being denied certain mortgages at rates more than two times higher than expected if they had been white.
- Discriminated in pricing certain mortgage loans: The agencies also allege that one of BancorpSouth’s lending units discriminated against African-American borrowers that it did approve by charging them higher annual percentage rates than white borrowers with similar loan qualifications. Specifically, the agencies allege that BancorpSouth granted its employees wide discretion to set the prices of mortgage loans. This discretion resulted in African-American borrowers paying significantly higher annual percentage rates than similarly situated white borrowers, costing African-American consumers hundreds of dollars more each year they held the loan.
- Implemented an explicitly discriminatory denial policy: The complaint alleges that BancorpSouth required its employees to deny applications from minorities and other “protected class” applicants more quickly than those from other applicants and not to provide credit assistance to “borderline” applicants, which may have improved their chances of getting a loan. The bank generally permitted loan officers to assist marginal applicants, but the explicitly race-based denial policy departed from that practice. An audio recording of a 2012 internal meeting at BancorpSouth clearly articulates this discriminatory policy, as well as negative and stereotyped perceptions of African Americans.
“When banks discriminate on the basis of race, they violate our civil rights laws and threaten the foundation of a fair economy,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division. “The Civil Rights Division will continue to enforce our nation’s fair lending laws to ensure that qualified applicants and borrowers can access credit and invest in their financial future without facing unlawful barriers.”
According to a release from the bank, it chose to settle the charges against it to “avoid protracted litigation” with the DOJ and CFPB. Instead of engaging in a lengthy legal fight over the charges, the bank said it would rather devote additional resources to “continue serving the communities in which it operates, including helping meet the credit needs of all borrowers in those communities.”
In a statement, James Rollins, the chairman and CEO of BancorpSouth, said that the bank views the settlement as a positive.
“We believe this settlement is a positive development for the Bank, and is in the best long-term interest of our customers, employees, and shareholders,” Rollins said.
“BancorpSouth is fully committed to fair and responsible lending practices in all communities throughout our footprint. Our settlement is a testament to that commitment,” Rollins continued. “We will continue to focus on what we do best – serving the needs of all our customers where they live and work.”
In a separate statement, a bank spokesperson said that despite the bank agreeing to the consent order with the agencies, it feels the allegations are without merit.
“The bank disagrees with these allegations. The decision to settle was made to avoid prolong and distracting litigation and to put the matter behind the bank,” bank spokesperson John Lovallo said. “And in agreeing to the consent order, the bank has not admitted to any of these allegations or to any liability.”
If the court accepts the settlement agreement, BancorpSouth will:
- Pay $4 million to a loan subsidy program: To increase access to affordable credit, the loan subsidy program will offer qualified applicants in majority-minority neighborhoods in Memphis mortgage loans on a more affordable basis than otherwise available from BancorpSouth. The loan subsidies can include interest rate reductions, closing cost assistance, and down payment assistance.
- Pay $2.78 million to African-American consumers harmed by discrimination: BancorpSouth will provide $2.78 million to African-American consumers who were improperly denied mortgage loans or overcharged for their loans because of BancorpSouth’s allegedly discriminatory pricing and underwriting policies.
- Spend at least $300,000 on targeted advertising and outreach: BancorpSouth will fund a targeted advertising and outreach campaign to generate applications for mortgage loans from qualified consumers in majority-minority neighborhoods in Memphis. The bank will be required to spend $100,000 annually on the campaign during the term of the order, which will be in effect for a minimum of three years.
- Spend $500,000 on local partnerships: BancorpSouth will spend $500,000 to partner with community-based or governmental organizations that provide education, credit repair, and other assistance in minority neighborhoods in Memphis.
- Extend credit offers: BancorpSouth will offer African-American consumers who were denied mortgage loans while BancorpSouth’s allegedly discriminatory underwriting policy was in place the opportunity to apply for a new loan at a subsidized interest rate.
- Expand its physical presence: In addition to a branch that BancorpSouth recently opened in a majority-minority neighborhood in Memphis, BancorpSouth must open one new branch or loan production office in a high-minority neighborhood in Memphis.
- Treat applicants fairly regardless of race: Among other revisions to its policies, BancorpSouth will implement policies that require its employees to provide equal levels of information and assistance to individuals who inquire about mortgage loans, regardless of race or any other prohibited characteristic.
- Pay a $3 million penalty: BancorpSouth will pay a $3 million penalty to the CFPB’s Civil Penalty Fund.
In its release, BancorpSouth stated that it has already announced “numerous enhancements” to its operations to “further strengthen its commitment to promote affordable lending products in low to moderate income and minority areas.”
Included among those changes are: naming a new director of community lending to oversee ongoing outreach efforts in all markets, including the Bank’s continued lending efforts in minority neighborhoods; naming a chief fair lending officer who is responsible for developing, evaluating, and implementing its fair lending program; adding a community development lending manager within the BancorpSouth mortgage team; and opening a new branch in Memphis.
“These enhancements, combined with the Bank’s centralized underwriting process and pricing, further strengthen the Bank’s commitment to develop and promote affordable lending products, in low and moderate income areas and minority areas,” the bank said in statement.
“We will continue to examine the most effective approaches to advance customer outreach and provide solutions to help customers reach their goals and communities become stronger,” Rollins said.
“BancorpSouth is dedicated to a culture of respect, diversity and inclusion in both our workplace and communities,” Rollins concluded. “We have a longstanding commitment to equal treatment and any form of discrimination will not be tolerated.”Source
Welcome to the BancorpSouth Securities Litigation Website
This website has been established to provide general information regarding the proposed settlement of the BancorpSouth, Inc. Securities Litigation, Case No. 3:14-cv-01564, pending before the United States District Court for the Middle District of Tennessee, Nashville Division (the “Litigation”). The capitalized terms used on this website and not defined herein shall have the same meanings ascribed to them in the Stipulation of Settlement (the “Stipulation”) dated March 30, 2018, which can be found and downloaded by clicking on the Case Documents tab above. Your rights may be affected by the Settlement if you purchased or otherwise acquired BancorpSouth, Inc. (“BancorpSouth” or the “Company”) common stock between July 12, 2013 and July 21, 2014, inclusive (the “Class Period”).
As more fully described in the Notice of Proposed Settlement of Class Action (the “Notice”), the initial complaint in this action was filed on July 31, 2014. On October 22, 2014, the Court appointed Lead Plaintiff and Lead Counsel. On January 9, 2015, Lead Plaintiff filed its Complaint for Violations of the Federal Securities Laws (“Complaint”).
On January 4, 2017, the parties’ counsel attended a one-day mediation session with an experienced mediator, but were unable to resolve the Litigation at that session. On December 10, 2017, following further discussions with the parties’ counsel (and after additional proceedings in the Litigation), the mediator presented the parties with a Mediator’s Proposal. The Mediator’s Proposal was ultimately accepted by both parties on December 29, 2017. Following additional negotiations, the parties reached an agreement to resolve the Litigation on the specific terms set forth within the Stipulation.
The Settlement, if approved, will result in the creation of a cash settlement fund of $13,000,000 (the “Settlement Amount”). The Settlement Amount, plus accrued interest (the “Settlement Fund”) and minus the costs of this Notice and all costs associated with the administration of the Settlement, as well as any attorneys’ fees and expenses that may be approved by the Court (the “Net Settlement Fund”), will be distributed to Class Members pursuant to the Plan of Allocation that is described in the Notice.
The law firm of Robbins Geller Rudman & Dowd LLP represents you and other Class Members. These lawyers are called Plaintiffs’ Counsel. These lawyers will apply to the Court for payment of attorneys’ fees and expenses from the Settlement Fund; you will not be otherwise charged for their work. If you want to be represented by your own lawyer, you may hire one at your own expense.
Although the information in this website is intended to assist you, it does not replace the information contained in the Notice and Stipulation, both of which can be found and downloaded by clicking on the Case Documents tab above. We recommend that you read the Notice and other relevant case documents carefully.Source
YOUR LEGAL RIGHTS AND OPTIONS IN THIS SETTLEMENT
|SUBMIT A PROOF OF CLAIM||The only way to be eligible to receive a payment from the Settlement. Proofs of Claim must be postmarked (if mailed) or received (if submitted online) no later than August 23, 2018.|
|EXCLUDE YOURSELF||Receive no payment. This is the only option that allows you to ever be part of any other lawsuit against the Defendants or any other Released Persons about the legal claims related to the issues raised in this Litigation. Exclusions must be received no later than August 31, 2018.|
|OBJECT||Write to the Court about why you oppose the Settlement, the Plan of Allocation, the request for attorneys’ fees and expenses, and/or the expenses of Class Representative. You will still be a Member of the Class. Objections must be received by counsel on or before August 31, 2018 and the Court on or before September 7, 2018.|
|GO TO THE HEARING ON SEPTEMBER 21, 2018||Ask to speak in Court about the fairness of the Settlement. Requests to speak must be received by counsel on or before August 31, 2018, and the Court on or before September 7, 2018. You do not have to attend the hearing unless you wish to speak either in support of the Settlement or in support of any objection you may have submitted.|
|DO NOTHING||Receive no payment from the Settlement. However, you will be bound by the Settlement, unless you have requested exclusion from the Class.|
|Submit Claim:||August 23, 2018|
|Request Exclusion:||August 31, 2018|
|File Objection:||August 31, 2018|
|Court Hearing on Fairness of Settlement:||September 21, 2018, at 1:30 p.m.|
DOJ and CFPB Reach Settlement with BancorpSouth over Redlining
News that BancorpSouth has reached a settlement with the Department of Justice and the CFPB over redlining should make people question how well the Community Reinvestment Act, as currently written, can prevent a bank from deciding to walk away from low-income and minority neighborhoods located within its service area.
Redlining describes the practice of a bank to avoid making loans in certain neighborhoods consciously. The term derives from the red lines used by regulators to draw “residential security maps” which were meant to serve as guidelines for underwriting. It contributed to the disinvestment in urban areas and in particular to neighborhoods of color. In the 1970s, community groups from Chicago organized to protest the practice both locally and across the country.
The settlement’s details, which reveal how the bank made an institutional practice of redlining minority neighborhoods, are unusual in the concrete nature of the allegations. In an era where a claim of bias can often be explained away by pointing to a logarithm, redlining accusations are difficult to prove.
The details of the DOJ’s complaint make a strong case to support their argument:
96.5 percent of loan officers working in Memphis were white.
When comparing loans made to African-Americans with those originated to whites, after controlling for credit characteristics, the African-American borrowers paid an additional 30.3 basis points in interest on first lien mortgages and 63.9 basis points on second-lien mortgage loans.
During DOJ testing, the same loan officer told a white tester that “620 is the minimum” credit score, but then told a black tester that “normally you want to have a 640 credit score.”
The DOJ complemented the preceding points with excerpts from audio recordings made at staff meetings.
- A manager told loan officers and processors that mortgage applications from minorities and other protected classes should be turned down in 21 days, and that “borderline” customers should be turned down quickly, but loans from white applicants could be excluded from the shortened review period.
- When asked by a person at the meeting as to why there would be a race-based policy in place, the manager said: “I think it’s lawsuits, it’s lawsuits, and we just dodged a really large bullet.” The “bullet” described was a threat made by a minority applicant to sue the bank. The lawsuit was not filed.
- The use of the n-word when discussing the recent hire of an African-American.
- When asked to explain the bank’s ‘race-based denial policy,” a loan comments that “they need to get their credit up” and “stop paying their damn bills late.”
All of these details serve to underscore how BancorpSouth had a systemic problem with race.
Part of the Issue is the Construction and Enforcement of the CRA Assessment Area
The FDIC allowed BancorpSouth to pick the areas where its CRA performance would be assessed, and as a result, the regulator made it possible for the bank to implement its disinterest in serving the credit needs of minority neighborhoods without running afoul of the law. Bancorp South drew the assessment areas for its 2013 CRA exam in such a way as to exclude every high-minority neighborhood and 137 of 142 majority-minority neighborhoods in the Memphis MSA. To do that, the bank had to draw most of downtown Memphis outside of its assessment area while also including most of the region’s wealthier suburbs inside its AAs. Fewer than half of the residents living inside the boundaries of the Memphis MSA are white, and in Shelby County, where eight percent of the metropolitan area’s minority population lives, only 27.5 percent are white.
But even though the bank was redlining, BancorpSouth received a “satisfactory” in its 2013 exam. The FDIC’s exam notes that “the bank displayed an adequate record regarding its borrower profile loan distribution…The institution established an adequate record regarding its geographic loan distribution….the bank displayed a good responsiveness to credit and community development needs.”
BancorpSouth changed its assessment areas in January 2013 to include all of the census tracts where it had a branch, both within the city limits of Memphis as well as inside five other counties in Tennessee. But according to the DOJ, the bank still maintained its policy of “discouraging prospective applicants for credit in minority communities.” But by gerrymandering its assessment areas, the Bank was able to pick census tracts where it had branches but still avoid having any branches in a minority neighborhood.
The catchment area for CRA is considered to be in all areas within an MSA where a bank has a branch – not just in selected census tracts. So while the bank could claim that it was meeting credit needs in the immediate census tracts where it had branches that should not have been enough to pass the expectations of a CRA exam. Nonetheless, the bank got a “satisfactory.” When the DOJ reviewed the bank’s lending from the lens of a broader area (loans made within 5 miles of a branch), applications from majority-minority areas were the exception. Only 13 percent of loan applications came from majority-minority areas – and the majority of applications received in those areas were from white applicants.
This mismatch between the demographics of an assessment area says less about the FDIC and more about a shortcoming in the legal construction of the CRA. As implemented, banks are given the choice of picking their assessment area. Thus, the bank was able to pick almost all of Tipton and Desoto Counties for its assessment, even though they had only one majority-minority census tract, while selectively excluding most of the City of Memphis.
The DOJ notes that BancorpSouth’s General Loan Policy states that its CRA assessment area and its primary trade area are one and the same. The DOJ says that the bank said that loans made outside of the trade area are “undesirable.” While the idea of a trade area in and of itself does not contradict the intent of the CRA, the idea that it could be so disaggregated is contrary to the spirit of the law.
A negative CRA exam would have to build its case upon a lack of lending, investment, and service within low-income areas and to low-income borrowers. As written, the CRA is not about race. This is an important caveat. Thus, the CRA exam process does not test for violations of the Equal Credit Opportunity Act or the Fair Housing Act. Thus, the FDIC did not ignore those laws, as it was not in its capacity to hold the bank accountable for compliance in these areas. But if it is the case that minority neighborhoods were also low-income neighborhoods, then the CRA exam missed something very significant. Source
From the Wall Street Journal:
“ … Bank officials admitted to filing more than 50,000 payment-change notices that were improperly signed, under penalty of perjury, by persons who hadn’t reviewed the accuracy of the notices, according to Justice Department officials.”
Telling a court you’ve reviewed a document when you haven’t? That’s perjury.
The Journal also noted that the Justice Department found that “more than 25,000 notices were signed in the names of former employees or of employees who had nothing to do with reviewing the accuracy of the filings.”
Many people lost their homes unjustly as a result of this mass-produced fraud. The practice was so widespread at J.P. Morgan Chase that it required the hiring of untrained college-aged temps – referred to within the organization as “Burger King kids“ – to generate all the fraudulent paperwork.
This is where we’re obliged to insert a sentence that has long been superfluous when reporting on deals of this kind:
The Justice Department did not announce the indictment of any individual bankers for the crimes which led to this settlement.
Corrupt, and getting worse
In an expanded version of a survey we first reported on in 2012, an updated study on behalf of law firm Labaton Sucharow found a deep-seated culture of immoral behavior among bankers in the United States and Great Britain. And it found that the situation was getting worse, not better, noting “a marked decline in ethics” since the first study was conducted.
The authors also found that there had been a”proliferation of secrecy policies and agreements that attempt to silence reports of wrongdoing and obstruct an individual’s fundamental right to freely engage with her government.”
In other words, bankers are becoming even more unethical – and banks are making it harder to report ethical lapses to the authorities.
The percentage of bankers who believed their own colleagues had engaged in illegal or unethical behavior has nearly doubled since 2012. And more than one-third of those earning $500,000 or more annually said they had first hand knowledge of wrongdoing in the workplace.
Born this way?
The Labaton Sucharow study illustrates something important: Crooked bankers aren’t born. They’re made.
According to the report, “Nearly one-third of respondents (32%) believe compensation structures or bonus plans in place at their company could incentivize employees to compromise ethics or violate the law. “
In fact, bankers’ bonuses do incentivize unethical and criminal behavior – and anything else it takes to generate profits. “Clawbacks” for ill-gotten gains are still few and far between. Remarkably few bankers have been fired for the widespread fraud that continues to characterize their industry. Prosecution for criminal behavior is extremely rare.
A system which rewards antisocial behavior begets social tragedy. It’s also a law enforcement nightmare. Criminology teaches that the presence of reward for criminal behavior, along with the absence of deterrence, almost inevitably leads to more crime.
The song says “you’ve got to be taught,” and this lesson apparently hasn’t been lost on the newest generations of bankers. “We are particularly dismayed by the ethical standards of the most junior employees in the industry,” write the authors of the Labaton Sucharow study, who found that younger bank employees were much more likely than their elders to admit a willingness to commit fraud if given the opportunity to get rich illegally and get away with it.
But then, why wouldn’t they? The banking industry’s incentive system, combined with the government’s refusal to prosecute, has taught them that the old saying is wrong: crime does pay.
Back on top
Wall Street certainly isn’t suffering in the wake of the financial crisis it created. The financial industry is nearly as large as it was before the crisis. In fact, its profits are as large a chunk of the total economy today as they were before Wall Street imploded (and was rescued by taxpayers.)
Neil Irwin of the New York Times notes that current bank profits are “more than double their average level over the 70 years ended in 1999.” That’s called financialization. It’s what happens when the productive economy of building, selling, and servicing things is crowded out by unproductive activities which redirect profits toward the manipulation of money.
As Irwin notes, bankers’ incomes are rising again, and the World Financial Center’s vacancy rate has fallen to 5 percent from a post-crisis high of 41 percent.
The Wall Street Journal reports that “Top executives from the biggest U.S. banks, concerned about anti-Wall Street rhetoric already bubbling up on the 2016 campaign trail, are working to push back against the prevailing narrative that banks are bad.”
Are they rooting out corruption inside their own institutions? Changing their incentive plans? No. According to the Journal, discussions centered on “finding ways to emphasize the positive role banks play in the economy and the changes big firms have made since the 2008 crisis … by engaging with local media, elected officials and community leaders.”
That’s not likely to move hearts and minds among the public at large. Two thirds of voters polled last year for Better Markets said they believe “the stock market is rigged for insiders and people who know how manipulate the system.”
“Deep-seated cultural and ethical failures”
These voters are right – and they’re not alone. William Dudley, President of the Federal Reserve Bank of New York, spoke in 2013 of “deep-seated cultural and ethical failures” and “the apparent lack of respect for law, regulation and the public trust” in the culture of our biggest banks.
Dudley reached that conclusion in 2013, and the Labaton Sucharow study suggests that banker ethics have gotten worse since then.
Our banking system has a design problem, because its incentives are broken. Financialization is stifling the productive economy. And the systemic threat posed by our biggest banks has made them immune from real punishment.
These massive financial institutions don’t need a PR campaign. They need to be cleaned up – and they need to be broken up.
“If you ain’t cheating,” said one of the traders involved in the currency exchange scandal, “you ain’t trying.” If we’re not addressing the financial sector’s systemic threat to our economy, or its affronts to our system of justice, then we ain’t trying either.Source
Modern bankruptcy laws, like the Biblical provision above, allow debtors to keep certain property when they file bankruptcy. This gives debtors a fresh start and discourages debtors from going into debt-bondage again, after the bankruptcy is over, in order to survive.
Jesus taught us that sin is a type of spiritual debt. Jesus also taught us to ask God to “forgive us our debts [sins] as we forgive our debtors [those who sin against us]” (Matthew 6:12, Luke 11:4). Sin creates a spiritual debt. Borrowing produces a financial debt. Regarding our spiritual debt, the law of justice declares: “the wages of sin is death [separation from God]” (Romans 6:23a). However, the law of grace and mercy states that “the gift of God is eternal life in Jesus Christ our Lord” (Romans 6:23b). Jesus paid for our debt of sin on the cross, a debt too big for us to pay.
Likewise, economically, the law of justice states that if you agree to borrow money and repay the debt, you must pay back such debt. The law of mercy, on the other hand, states that if you cannot pay the debt back, you may, through bankruptcy, obtain forgiveness for your obligation.
As with any act of mercy, someone must bear the cost or the burden, just as Jesus did in dying for our sins. With bankruptcy, the creditor and ultimately the consumers must, in mercy, bear the burden of the unpaid debt, but God said He will bless us for such acts of forgiveness and mercy (Deuteronomy 15:5,10,18).
Jesus, in two (2) parables, used the illustration of forgiveness of a financial debt to teach about God’s forgiveness and the requirement that mankind forgive (see Matthew 18:21-35 and Luke 7:36-50). “And when they had nothing with which to repay, he freely forgave them both”(Luke 7:42). On a spiritual level, by the grace and mercy of God, Jesus gave us a “fresh start” by canceling all our “sin” debts through His suffering and death on the cross. On an economic level, our nation will graciously help overburdened debtors, if necessary, by giving them a fresh start economically.
A guiding principle of U.S. bankruptcy law requires persons who file for bankruptcy to have “clean hands.” Accordingly, a debtor may not be freed from debts involving fraud, drunk driving, and deliberate wrongdoing. Moreover, bankruptcy law does not allow the discharge of child support and alimony debts. Further, most student loans, taxes (Romans 13:1,4,7) and secured loans are not forgiven in bankruptcy. Through these restrictions, bankruptcy laws seek to balance justice and equity (Proverbs 1:3).
As with most biblical principles, there is a balance. If you can repay your debts, you must. If you cannot, then you should determine how God would have you freed from the bondage of debt. Our modern bankruptcy laws were derived from the Bible(Deuteronomy 15:1-2). Further, the Bible describes financial miracles (2 Kings 4:1-7). Ultimately, you must seek wisdom and guidance from God as to the direction He would have you choose. God promises to give such wisdom to those who ask with a trusting heart (James 1:5-7; Proverbs 3:5-6). Further, the Bible admonishes us to seek Godly counsel (Psalms 1:1; Proverbs 12:15, 11:14, 15:22).
If you have mismanaged your finances, confess your failings to God now. You can receive, by faith, His forgiveness and cleansing (1 John 1:9). Remember, there is no condemnation or guilt to those who are in Christ Jesus (Romans 8:1). Jesus, by His love and mercy, gave us a fresh start, a new birth. Bankruptcy, based on the law of mercy with divine origins, if necessary, may provide you with a fresh start – a new and brighter economic outlook.
Top Banking Corruption Facts and Information News Articles
We have collected and compiled key excerpts from some of the most important and underreported news articles published by highly respected media sources which contain eye-opening information exposing various aspects of banking and financial corruption. Key sentences are highlighted for those with limited time. Links are always provided to the original sources for verification.
- Excerpts of Key Major Media News Articles Revealing Financial Corruption
- Excerpts of Revealing Banking Bailout News Articles
- Excerpts of Key News Articles on the $700 Trillion Derivates Bubble
Most Important Banking Corruption Information Document
How much do you know about the banking system and who issues the money you carry in your pocket? Considering the vital role money plays both in our individual lives and in the world, our educational system teaches us amazingly little about how money is created, how banks operate, and what causes the huge banking scandals and bankruptcies that have occurred. After reading the information below, you will understand why this critical information is kept quiet, and why we feel it is important to reveal what those in power don’t seem to want us to know.
https://www.WantToKnow.info/financialbankingcoverup – Three pages
What is Corruption
Corruption is dishonest behavior by those in positions of power, such as managers or government officials. Corruption can include giving or accepting bribes or inappropriate gifts, double dealing, under-the-table transactions, manipulating elections, diverting funds, laundering money and defrauding investors. One example of corruption in the world of finance would be an investment managerwho is actually running a Ponzi scheme.
BREAKING DOWN Corruption
There are many situations in which a person can be considered corrupt. In the financial services industry, chartered financial analysts and other financial professionals are required to adhere to a code of ethics and avoid situations that could create a conflict of interest. Penalties for being found guilty of corruption include fines, imprisonment and a damaged reputation. Engaging in corrupt behavior may have negative long-lasting effects for an organization. In 2015, five prominent investment banks were fined a cumulative total of approximately $5.5 billion for rigging the foreign exchange market between 2007 and 2013.
Corruption is likely to cause inefficiency when assets are used inappropriately. When corruption occurs within an organization, unflattering media coverage typically follows, which may result in customers losing trust in its business practices and products. A comprehensive public relations campaign is often required to limit reputational damage and restore trust. This requires valuable resources such as time and money, which may result in other critical areas of the organization being deprived of resources, causing inefficiencies to develop and possibly financial losses to be realized.
John Wesley who said that what we tolerate in our generation, will be embraced by the next. Wesley is 100% correct! We are living in sick times.
HNewsWire- “All political language is designed to make lies sound truthful and murder respectable.” Just look at some of our modern day examples: torture is “enhanced interrogation techniques”; murder is “collateral damage”; the aggression initiation of war is a “pre-emptive strike”; the theft of taxpayers’ money is a “bailout”; and the theft of depositors’ money in a bank is a “haircut” or “bail-in”.In a blatant example of Newspeak, the New World Order controllers (through the psychiatric DSM V) have tried to rename pedophiles as “minor-attracted persons” and redefine pedophilia as a “sexual orientation”. This makes no sense, since sexual orientation has to do with gender not age, with whether you are attracted to males or females, not how old they are. There are even organizations (like B4UAct.org) which are claiming that pedophiles are being unfairly stigmatized for their feelings!
Justice is a word that stands alone, adding anything to it demeans it….
It is impossible to find anyone in the Bible who was a power for God who did not have enemies and was not hated.
Children are being misplaced or lost in our foster care system, we must demand more openness and accountability from each state.
If you have information or believe there is a child in danger that’s being exploited please contact 127 Faith Foundation
The 127 Faith Foundation
Please help me help these kids(orphans) that are in trouble, PLEASE 80% of the book sales goes directly to: The 127 Faith Foundation
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“It is better to be divided by truth than to be united in error. It is better to speak the truth that hurts and then heals, than falsehood that comforts and then kills. Let me tell you something, friend, it is not love and it is not friendship if we fail to declare the whole counsel of God. It is better to be hated for telling the truth, than to be loved for telling a lie. It is impossible to find anyone in the Bible who was a power for God who did not have enemies and was not hated. It’s better to stand alone with the truth, then to be wrong with a multitude. It is better to ultimately succeed with the truth than to temporarily succeed with a lie. There is only one Gospel and Paul said, ‘If any man preaches any other gospel unto you than that which we have preached unto you, let him be accursed.”
Proverbs 31:8 (NIV)
Speak up for those who cannot speak for themselves,
for the rights of all who are destitute
MY MISSION IS NOT TO CONVINCE YOU, ONLY TO INFORM…
Jesus come quick, there is nothing left in society that’s sacred….
#Fraud #Banks #Money #Corruption #Bankers
Those who are spiritually dead are oblivious to their state (2 Corinthians 4:4). They assume they can “eat, drink and be merry” (Luke 12:19 NIV), for physical life is all there is. In so doing, they fail to engage their inmost longings. They fail to recognize their sense of purposelessness, disconnectedness, and the fact that,…Read More
Satan is a HOMOSEXUAL, a pedophile completely devoted spiritual being who has led a heavenly revolt against God and was subsequently cast down into the earth (Luke 10:18). His personal name, “Satan,” means “adversary.” This name indicates Satan’s basic nature: he is the enemy of God. Unfortunately, the fornicator, rapists, liar and the homosexual first…Read More
What is the gift of prophecy? There is much misunderstanding regarding its definition. Many understand prophecy as speech that predicts the future. However, this is only one aspect of the biblical prophet’s work. Prophesying can also mean to proclaim as a pastor does during a sermon. In this sense, a person can be gifted in…Read More
The true church is defined in the Bible as a called-out assembly of those who are true followers of Jesus Christ. Of his true disciples, Jesus said, “For whoever does the will of My Father who is in heaven, he is My brother and sister and mother.” (Matt. 12:50) The corollary would then mean that…Read More
StevieRay Hansen Commentary-Non-Christian scientists have recognized the bodily differences of the sexes. Anne and Bill Moir, for example, note that men have on average ten times more testosterone than women. Studies show that women use a vocabulary that is different enough from men’s to be “statistically significant.”3 We are distinct emotionally, too. The Scripture gives…Read More
This is what happens when the God of peace, law, and order is rejected. In comes lawlessness and chaos. Our God told us this would happen 2,000 or so years ago. It is happening but we did not choose this. We who believe did not reject the Lord Jesus Christ or the Father. We accept…Read More
Many Christians use the cliché “Love the sinner; hate the sin.” This saying is not found in the Bible in so many words; however, Jude 1:22–23 contains a similar idea: “Be merciful to those who doubt; save others by snatching them from the fire; to others show mercy, mixed with fear—hating even the clothing stained by corrupted…Read More
Pedophiles, Perverts and Woefully Misguided Men Outrageously Dressed as Women Expose Our Children to Their Gender Confusion and Sinful Lifestyle.
“Whoever causes one of these little ones who believe in me to sin, it would be better for him if a great millstone were hung around his neck and he were thrown into the sea,”Pay Attention Pedophile” …….. Shake it! Blow kisses! Proud moms encourage their little girls to prance around on stage in what…Read More
Caring for children is spoken of highly in the Bible. For example, James 1:27 says that caring for children in need pleases God: “Religion that God our Father accepts as pure and faultless is this: to look after orphans and widows in their distress and to keep oneself from being polluted by the world.” Ephesians 6:4 says, “Fathers, do…Read More
There is a principle found in Jesus’ words about children. Jesus used a child to teach His disciples that childlike faith is necessary for entrance into the kingdom of heaven. At the same time, He said that the Father has concern for all of His “little ones” (Matthew 18:1–14). In that passage, Jesus says, “But…Read More