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Whistleblower: Wall Street Has Engaged in Widespread Tampering of Mortgage Funds

propublica.org

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Re: Whistleblower: Wall Street Has Engaged in Widespread Tampering of Mortgage Funds

#2

Post by tchalla »

> The historical profits reported for some buildings were listed as much as 30% higher than the profits previously reported for the same buildings and same years when the property was part of an earlier CMBS. As a rough analogy, imagine a homeowner having stated in a mortgage application that his 2017 income was $100,000 only to claim during a later refinancing that his 2017 income was $130,000 — without acknowledging or explaining the change.

TL;DR

Re: Whistleblower: Wall Street Has Engaged in Widespread Tampering of Mortgage Funds

#5

Post by cdubzzz »

> Flynn has amassed “materials identifying about $150 billion in inflated CMBS issued between 2013 and today,” according to the complaint.

[...]

> The SEC has the power to fine companies and their executives if fraud is established. If the SEC recovers more than $1 million based on Flynn’s claim, he could be entitled to a portion of it.

Hope he got a good lawyer!

Re: Whistleblower: Wall Street Has Engaged in Widespread Tampering of Mortgage Funds

#6

Post by jl2718 »

It’s sort of amazing how easy and widely accepted it is to submit, under oath, completely different corporate financial attestations depending on whether you are dealing with the IRS, the SEC, or FINRA.

I can imagine 50 years ago, when they all got the ability to check electronically, and knew that everybody was cheating, but they couldn’t do anything because it would it would crash the economy, and also these computers were taking their jobs, so the agencies decided to be willfully ignorant and inefficient and setting rules according to whatever people were doing already. So now it’s like, “OMG we never saw this coming!”

Re: Whistleblower: Wall Street Has Engaged in Widespread Tampering of Mortgage Funds

#8

Post by larrydag »

jl2718 wrote: post #6

It’s sort of amazing how easy and widely accepted it is to submit, under oath, completely different corporate financial attestations depending on whether you are dealing with the IRS, the SEC, or FINRA. I can imagine 50 years ago, when they all got the ability to check electronically, and knew that everybody was cheating, but they couldn’t do anything because it would it would crash the economy, and also these comput…

50 years ago banking was a very personal business. A business would work locally with their own bank. The bank knew the owners and since they banked with them knew their cash flows. Now banks are national conglomerates. There is a lot of cost in banking and many of the large banks have moved to automated systems to reduce overhead and labor. This doesn't excuse the bank but they are permitting credit for all sorts of things they probably don't want on their books. It's a bit of a mess right now in the banking industry. You may ask are they knowingly allowing these loose standards? Perhaps, but I'm willing to bet it's more in the line of ignorance is bliss.
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