Premium Essay

Ambac Lawsuit

In:

Submitted By charliebbond
Words 2490
Pages 10
E-mails Suggest Bear Stearns Cheated Clients Out of Billions

By Teri Buhl
Jan 25 2011, 1:01 AM ET
Lawsuit alleges the bank took extreme measures to defraud investors, and now JPMorgan may be on the hook

Former Bear Stearns mortgage executives who now run mortgage divisions of Goldman Sachs, Bank of America, and Ally Financial have been accused of cheating and defrauding investors through the mortgage securities they created and sold while at Bear. According to e-mails and internal audits, JPMorgan had known about this fraud since the spring of 2008, but hid it from the public eye through legal maneuvering. Last week a lawsuit filed in 2008 by mortgage insurer Ambac Assurance Corp against Bear Stearns and JPMorgan was unsealed. The lawsuit's supporting e-mails, going back as far as 2005, highlight Bear traders telling their superiors they were selling investors like Ambac a "sack of shit."
They were selling investors like Ambac a "sack of shit."

News of internal whistleblowers coming forward from Bear's mortgage servicing division, EMC, was first reported by The Atlantic in May of last year. Ex-EMC analysts admitted they were sometimes told to falsify loan-level performance data provided to the ratings agencies who blessed Bear's billion-dollar deals. But according to depositions and documents in the Ambac lawsuit, Bear's misdeeds went even deeper. They say senior traders under Tom Marano, who was a Senior Managing Director and Global Head of Mortgages for Bear and is now CEO of Ally's mortgage operations, were pocketing cash that should have gone to securities holders after Bear had already sold them bonds and moved the loans off its books.

Mike Nierenberg, who ran the adjustable-rate mortgage trading desk at Bear and is now the head of mortgages and securitization for Bank of America, was a key player ensuring the defaulting loans Bear was buying

Similar Documents

Premium Essay

Team 3

...A sports bar named Reed Pierce’s bar in Jackson Mississippi had a case of pregnancy discrimination when they fired a waitress unfairly. Melody McKinley was four month pregnant when she was simply taken off the schedule. She was also told “the baby is taking its toll on you” ("U.s. Equal Employment Opportunity Commission", 2013). She had never asked to cutback on shifts and was also not under any medical restrictions while pregnant. The settlement was a two-year decree that required the bar to implement policies and training to prevent pregnancy discrimination and monetary relief for $20,000 for McKinley. Intesa Sanpaolo is a bank that operates in New York. Giuseppe had gone on FMLA leave do to many health issues including depression. After being on leave he for five months Intesa sent Giuseppe a letter asking if he was going to return to work or if he was going to abandon his position at the bank. The back received a letter from Giuseppe’s attorney stating that “has not at any time evinced or expressed an intention to 'abandon his position.' Rather, he has been sick and unable to work, with an uncertain prognosis and a return to work date that is indeterminate at this time” (Nowak, 2013). The bank then terminated Giuseppe’s employment. He later sued the bank and their response was that he requested an indefinite leave. They expressed that this was an accommodation, which was not required by the employer since it was an unreasonable request. Even though the New York law mentioned...

Words: 462 - Pages: 2

Free Essay

Acct

...➢ Style of Case and Citation: Wal-Mart Stores Vs. Johnson 106 S.W.3d 718 (Tx.2003) ➢ Court Rendering Final Decision: Trial Court ➢ Identification of Parties and Procedural Details: The plaintiff is Monroe Johnson. The defendant is Wal-Mart. Monroe Johnson is suing Wal-Mart based on injuries he sustained during an incident at Wal-Mart where a store employee dropped many reindeer on him. ➢ Discussion of the Facts: An employee of Wal-Mart dropped reindeer on Monroe Jackson. He sustained a cut on his arm and the employee bandaged him up. He may no threats of suing and stated he was fine. Hours later he was uncomfortable in his neck and his arm and could not sleep. He saw his physician the next day and was prescribed painkillers. Six months later still in pain he sued Wal-Mart. 17 months after the initial incident he finally had a surgery that fixed his neck. ➢ Statement and Discussion of the Legal Issues in Dispute: . The statements are that Monroe Jackson was injured at Wal-Mart. The manager took statements and photos; however, did not retain the reindeer that landed on the consumer. When the court was presented with the case there were two very different accounts of how large the reindeers were and it could not be accounted for. The court ruled in favor of Mr. Johnson on the basis that Wal-Mart did not retain the reindeer because it would have been detrimental to their case therefore causing fault against Wal-Mart. ➢ Subject...

Words: 485 - Pages: 2

Premium Essay

Bp Oil

...by the BP oil spill, including legal options for businesses and individuals looking to get back on their financial feet after the oil spill. (For in-depth information on filing a claim with BP's $20 billion compensation fund, see Nolo's article BP Oil Spill: Filing a Claim With BP's Compensation Fund.) The BP Oil Spill: Types of Lawsuits The BP oil spill has already prompted the filing of thousands of lawsuits. Businesses and workers have seen their livelihoods suffer or even disappear in Louisiana, Mississippi, Alabama, Florida, and Texas. Families and individuals in the Gulf region worry about the health hazards posed by the chemicals used to disperse and clean up the oil. And, with its dubious distinction as the largest environmental disaster in U.S. history, the BP oil spill has inflicted immeasurable devastation on the Gulf's coastline, wetlands, wildlife, and ecosystems. Here's a look at the different kinds of lawsuits being filed over the BP oil spill (with links to more information from Nolo where relevant). * Lost business profits and individual income losses. Thousands of businesses and workers in the Gulf region have filed lawsuits against BP, seeking repayment for profits and income that were lost because of the oil spill. These plaintiffs include companies and employees in the commercial...

Words: 1677 - Pages: 7

Free Essay

Law 421

...Interactions Josh Herricks LAW/421 June-6-2013 Luke Martin Legal and Ethical Issues in Resolving International Interactions When an individual or a company is going to involve themselves in international transactions and or resolve a problem he or she should be educated with the laws and understand the foreign culture that he or she is doing business with. Without knowledge of the laws and the customs of a country it could mean that the business transaction will end before it started. It does not matter how small the international transaction, how good the partnership is, and if he or she thinks that nothing will ever happen during international transaction it is him or hers responsibility to make sure they are protected from any lawsuits and any litigations occurring. Businesses that take part in international transaction need to remember the transaction can be challenging. Both parties of an international transaction should come to an agreement on what is the choice of law and what forum selection will be used. The choice of law is to help eliminate confusion and helps coming to an understanding. The forum selection is a decision on how the conflict will be resolved such as arbitration, litigation, jurisdiction of the courts, and procedures. More issues are the culture will be different in a foreign country and if there are any religious views that he or she follows. In the United States men and women are treated equally. Men and woman have the choice on what they want...

Words: 1007 - Pages: 5

Premium Essay

Business Law Paper

...as maintain order when it has gotten out of order (Llewellyn, 213),” they are also be used to punish the most minor crimes and torts. Each year, about 18 million to 30 million civil cases are considered in both federal and state courts (Pflepsen). Moreover, the United States of America has more than 70 percent of the lawyers in the entire world with half of them doing what non-lawyers do in the other parts of this world (Pflepsen). Yet, the mere fact that the United States has more than a third of the entire world’s lawyers shows that there is a high demand for litigation services, as demonstrated by the number of civil cases that are brought to federal and state courts. Some people have different views toward this previously mentioned lawsuit numbers. Given that there are different varieties of crimes that people can be punished in courts for, such as assault and battery, false imprisonment,...

Words: 974 - Pages: 4

Premium Essay

Wal-Mart Women

...Question 1: What financial impact do you think the lawsuit could potentially have on Wal-Mart? If the law suit was successful the company would have to pay all the compensation amount which was around 86 million dollars to its entire 1.6 million female employees .Which in short would be a big blow to the company’s financials, and also with the deteriorating image caused by the issue they might possibly lose out on an considerable amount of customers leading to further financial implications. It would also result in higher prices in the store because the company would try to make up for all the loss incurred cause of the particular suit. Question 2: What are the major moral complaints of the females suing Wal-Mart? Do you believe these moral complaints are justified? Why? The major complaints launched by the women were that the company (wal-mart) discriminated against female employees in promotions pay, management training and job assignments. The women stated that promotions in wal-mart were biased towards men, where men were promoted much faster and at a much frequent rate then women. They also stated that there was a pay gap between men and women where two people of different gender on the same positions were paid differently and women were often paid fairly lower than the men. I think feel the complaints are valid. If you are in a job and you see other coworkers getting hired whom are less qualified than you are then I think that the complaints are valid. If more than...

Words: 374 - Pages: 2

Premium Essay

Kudler Foods

...and government to pay closer attention to food labels, especially dietary supplements. The food industry is highly competitive and the high regulations could cause severe profit margin decreased in companies who do not legally represent themselves appropriately. Claims against companies in the food industry There are several areas where companies need to watch out for. The world is changing into this environmental friendly monster, which is outstanding, and it is affecting the food industry in the claims companies have to deal with. State consumer protection acts are other avenues where lawsuits can develop. “Food and beverage companies often face litigation in more than one jurisdiction, with more than one plaintiff, represented by separate sets of plaintiffs’ counsel” (http://www.sidley.com/productsliabilitylitigationfoodindustry/). In some cases, settling these lawsuits out of court is the best approach because of the negative publicity it could cause, but it’s just another example if the importance in having proper legal representation in the food industry. Food industry litigation example Companies in the food industry are spending thousands of dollars annually in order to keep the price down with litigation...

Words: 928 - Pages: 4

Premium Essay

Importance of Training for Employees

...Importance of Training for Employees Anonymous HRM 326 Importance of Training for Employees The effectiveness of an organization greatly depends on how resourceful are its employees and how well prepared they are to meet challenges at work. Many organizations request the services of outside consultants to identity and implement trainings to improve the performance of its’ employees. Nowadays, the diversity of cultures in the United States, the complexity of the law system, and the challenges employees face regularly in their work places, are forcing organizations to train their employees to overcome these challenges. Trainings in legal requirements, diversity, and employee’s growth have become necessary for organizations to maintain the effectiveness of the employees. The main focus of this paper is to discuss how important are these subject areas to the development of employees professional and personal needs. Also the paper will focus on what benefits organizations acquire by implementing these types of employee trainings. Employees’ Legal Requirements During Training There are many potential situations during training that can adversely affect the reputation of an organization and can make employees vulnerable to legal actions (Noe, Chapter 10, 2008). Some of these adverse situations that can occur during training are employees getting injured during training events, not including all genders and races in the training, providing...

Words: 1087 - Pages: 5

Premium Essay

Encountering Risks and Reducing Exposure

...Traditional Litigation: Encountering Risks and Reducing Exposure When dealing with traditional litigation, a business or organization will risk scrutiny of the company’s image or brand, and clearly suffers monetary costs, which can affect the entity’s bottom line. Reflecting on the traditional litigation system, dependent on the type of trial, for example, a civil trial, the burden of proof is rested upon the plaintiff. The plaintiff must present truthful evidence or proof to a judge or jury against the defendant. Thus, the strength of the plaintiff’s credible facts and truth must be supportive of the plaintiff’s claim and proven stronger than the defendant’s defense. Considering the requirements to support a case (plaintiff or defendant), research and costs will rise. The initial course of the discovery process is a difficult factor in itself and has several disadvantages for each party involved. It is expensive, time consuming, and for the most part, a burden in effort to gather relevant evidence to make or strengthen the plaintiff and/or prosecutors case. On the other hand, for the defendant, the discovery process could reveal implicating evidence causing a weak defense or no defense by any means. As an advantage however, both parties, through the discovery process, are given the opportunity to civilly research, view, and gather relevant evidence and information related to the case, which supplies an advantage for each or either party to identify the strengths and weaknesses...

Words: 930 - Pages: 4

Free Essay

Business Law

...Question One: Explain the difference between substantive and procedural law. Substantive law is the statutory or written law that defines rights and duties of people as they act in society and it deals with the legal relationship between people. Substantive law is an independent set of laws that decide the fate of the case and cannot be applicable in non-legal contexts. So substantive law underlines the essential substance of a trial. Procedural law provides the machinery to enforce the substantive laws on the government bodies. It comprises the rules by which a court hears and determines what happens in civil or criminal proceedings. It deals with the method by which substantive law is made and administered. Procedural law has no independence and can be applicable in non-legal contexts. It only tells how the legal process to be executed by giving a step-by-step action. Question Two: During the discovery phase, the parties resort to the use of interrogatories, depositions, admission requests and document production requests. Briefly define these different discovery tools and explain the purpose for each. Explain the purpose of discovery as you understand it. Interrogatories are a formal set of written questions directed by one litigant and required to be answered by the other party and are used for the purpose of clarifying and narrowing the issues or the facts and help to determine in advance what facts will be presented at trial in the case. Deposition is the oral...

Words: 490 - Pages: 2

Free Essay

Insurance

...and defamation of character How a Personal Excess Liability Policy Works As the name implies, a Personal Excess Liability Policy provides an added layer of protection on top of your existing auto and homeowner insurance policies. Further, with a PELP, you’re protected with the full coverage amount of your policy, plus the standard liability coverage amount from your existing auto or home policy. You get the $1 million protection in addition to the liability coverage provided by your auto or home policy. Let’s say you have: $1 million of personal excess liability coverage. $300,000 of auto or homeowner liability If you were sued for $1 million, your basic auto or homeowner policy would cover the first $300,000 of the lawsuit costs, then your PELP policy would cover the additional $700,000. Without this additional liability coverage, your current and future assets and income could be at considerable risk in order to pay off this debt. Valuable Protection and Peace of Mind MetLife Auto & Home’s Personal Excess Liability Policy gives you peace of mind knowing you have the extra coverage you need to protect your...

Words: 280 - Pages: 2

Premium Essay

Legal Issues in Health Care

...three different relations that exist in any hospital - Hospital Relations, Hospital-Physician Relations and Hospital-Payer Relations. This has both good and bad effects and depends on what the change is. It has been speculated that over 50 percent of these legislations end up in the court. During 1985 to 1999, it was reported that 61 percent of 394 reported cases all ended up in the court due to some incidents that happened in the hospitals. These incidents are not good in themselves as it has lots of negative impacts on people (service taker) in general along with hospitals themselves, and most of the times, it is with the things that were not intentional. There are times when things go wrong unintentionally and still people tend to lawsuit the medical staff or physician stating that they have done it purposefully. This often seemed to happen in every hospital now and then due to all sort of things that’s happening at their personal as well as in their professional life. The main issue discussed in this article is the problems associated with Hospital Relation that the hospitals most often go through. Hospital relation is really a big concern as it affects the people the most in general. Raising price of different services the hospital provides is one of them that concerns people a lot. As to quote an example, the hospitals can increase the price of heart transplant or other surgeries based on their relation with other companies and organizations they deal with....

Words: 712 - Pages: 3

Premium Essay

State of Confusion

...State of Confusion BUS/415 State of Confusion Tanya Trucker owns a transportation company who intends to bring a suit against the state of Confusion to overturn a statute that requires all trucks and trailers to use a B-type truck hitch. The problem is that the B-type hitch is manufactured by only one company in the state of Confusion. In order for Tanya Trucker’s equipment can drive through the state of Confusion, the driver must stop at this manufacturer and have the hitch installed, or the driver will have to drive around the state. The hitch will cause Tanya additional expenses. Tanya’s transportation company is in the state of Denial. Tanya will need to determine what court has jurisdiction over the suit and if the state of Confusion’s statute is constitutional. Tanya also needs to decide what provisions of the U.S. Constitution would be applied by the court to determine the statute’s validity. Tanya will decide if she is likely to win her case before filing suit and will need to research to see what the stages of a civil suit are. What court will have jurisdiction over Tanya’s suit? Why? The Civil Court will have jurisdiction over Tanya’s suit against the State of Confusion because Tanya Trucker and the State of Confusion are private entities. Civil Courts handle suits between individuals and organizations, or suits between the two, to where compensations are awarded to a victim. The Sate of Confusion can be charged in civil litigation...

Words: 957 - Pages: 4

Premium Essay

Bhumpharn

...Question 14 GMM Grammy is beinGMM Grammy is being sued for copyright infringement in several cases. Compute the value of the liability that the company has accrued in its balance sheet for the outcome of these lawsuits?g sued for copyright infringement in several cases. Compute the value of the liabilities that the company has accrued in its balance sheet This question is about contingent liabilities that GMM Grammy have liabilities that should recorded in balance sheet or not? If yes we will calculation provision for litigation. If not GMM Grammy will not calculation liabilities and we call this as contingent liabilities. Provisions of liabilities Provisions should only be used for the purpose for which they were originally recognized. They should be reviewed at each balance sheet date and adjusted to reflect the current best estimate. If it is no longer probable that an outflow of resources will be required to settle the obligation, the provision should be reversed. Since there is common ground as regards liabilities that are uncertain, It requires that entities should not recognize contingent liabilities – but should disclose them, unless the possibility of an outflow of economic resources is remote. Contingent liabilities As of December 31, 2011 the company has litigation with third party as follows; a) A subsidiary was sued as jointly responsible for infringement of the copyright to musical works, with initial damages of Baht 50 million claimed together with...

Words: 453 - Pages: 2

Premium Essay

Negotiation Strategy

...Negotiation Strategies Paper Michael-Paul Battle MGT/445 April 28, 2011 Rodney Cooper Negotiation Strategies Paper Winston Churchill once said, “However beautiful the strategy, one should occasionally look at the end results.” Although this is implied toward war, one can apply it to the art of negotiating. Negotiators use different tactics and strategies when trying to achieve a desired result. To understand how strategies in negotiating affect the outcome of the results, two articles that employ different negotiation strategies are reviewed and discussed. The discussion includes the negotiation processes used in the selected articles, a comparison and contrast between two strategies, and how those strategies can be applied to MHMG Cardiology Southwest. Negotiation Strategies Integrative Many people would agree trust is earned. When a negotiator is looking to earn trust during a deal, they are building a relationship with the other party in hope of continuing to do business later down the line. Building a relationship is one aspect of integrative negotiation-a process often seen as ‘win-win’ situations involving two or more issues to be negotiated (Negotiation Experts, 1996-2010). One example of integrative negotiation is the negotiation that took place between a Navy contractor and a shipyard in Greece. Because of political differences, the shipyard had not done work on U.S. Naval ships over two years (Wengrowski, 2004). The ship in question received critical...

Words: 1107 - Pages: 5