The Corporate World - Written by Beasley Allen on Tuesday, January 17, 2012 13:02 - 0 Comments
Two former CEOs at mortgage giants Fannie Mae and Freddie Mac are the highest-profile individuals to have been charged in connection with the 2008 financial crisis. In a lawsuit filed in New York, the Securities and Exchange Commission brought civil fraud charges against six former executives at the two firms, including former Fannie CEO Daniel Mudd and former Freddie CEO Richard Syron. The executives were accused of understating the level of high-risk subprime mortgages that Fannie and Freddie held just before the housing bubble burst.
Robert Khuzami, SEC’s enforcement director, stated that executives at both Fannie Mae and Freddie Mac told the world “that their subprime exposure was substantially smaller than it really was.” Khuzami noted that huge losses on their subprime loans eventually pushed the two companies to the brink of failure and forced the government to take them over. There has been widespread criticism of federal authorities for not holding top executives accountable for the recklessness that triggered the 2008 crisis. Hopefully, this filing is the start of more to come.
Fines against executives charged in SEC civil cases can reach up to $150,000 per violation. SEC Chairman Mary Schapiro has asked Congress to raise the limit to $1 million. The SEC has brought other cases related to the financial crisis since it began a broad investigation into the actions of Wall Street banks and other financial firms about three years ago. For example, Goldman Sachs & Co. agreed last year to pay $550 million to settle charges of misleading buyers of a complex mortgage investment. JPMorgan Chase & Co. resolved similar charges in June of last year and paid $153.6 million. Citigroup Inc. also agreed to pay $285 million to settle similar charges. But that settlement was recently rejected as being inadequate by a federal judge in New York City. Thus far, charges against prominent top executives have not happened. It will be interesting to see now if more individuals are charged.
Source: Associated Press
Leave a Reply
- An Update on the Firm's Mass Torts Litigation
- Eight Car Makers Join in the Recall of Exploding Airbags
- The Deepwater Horizon Claims Program is Up and Running Again
- Favorite Bible Verses
- J&J Pays Oregon $4 Million To Settle Hip Implant Marketing Claims
- MF Global Officers’ Defense Cost Already At $48 Million
- GSK Fined Record $489 Million For Bribery In China
- Bank Of America’s Mortgage Backed Securities Settlement Is The Most Consumer Friendly Deal Struck Thus Far
- Alabama Supreme Court Affirms Class-Action Status For $3.2 Billion Investor Lawsuit Against CVS Caremark
- U.S. Senate Confirms Jill Pryor To 11th Circuit
- Alabama Campaigns Move Slowly Towards November
- The National Scene Begins To Generate Interest
- United Kingdom’s Government Backs BP
- U.S. Chamber Sides With Foreign Oil Company Over Its Own Members
- Halliburton Reaches Settlement On Claims
- A Confirmation Of Judge Barbier’s Ruling That BP Was Grossly Negligent
- I bought my f350 from our local ford 2 years ago it had 140000 on it in the firs...
- I have worked for dollar general for 14 1/2 years. sept 29th me and my whole cre...
- I had the same ignition problem where the car would not turn off on my 2007 HHR ...
- my recall was just preformed and power steering has gone out. are these two issu...
- I would like to know if I have A case that your firm would take on. I had severe...
- If possible, I would love to join the class action law suit.
We own a 2004 F 35...
- I am wondering about this lawsuit. What the outcome is....
- You can find more information about Lipitor and its connection to Type 2 diabete...
Recent Settlements - Feb 9, 2012 7:09 - 0 Comments
More In Recent Settlements
- A Further Update On The AWP Litigation
- Firm Reaches Settlement In Fort McClellan Radio Tower Collapse Case
- Firm Reaches Settlement In Sikorsky Helicopter Crash
- The Philadelphia Story
- St. Croix, Virgin Islands Settlement
Product Liability - Oct 2, 2014 13:14 - 0 Comments
More In Product Liability
- NHTSA Looking Into Ford Fiesta Door Latch Problems
- NHTSA Looks At Chrysler Minivan Stalling Issue
- NHTSA Puts Blame on GM For Hiding Ignition Switch Defect
- Aurora Shooting Victims Sue Ammunition E-Retailers
- Children’s Clothing Should Never Be Fire Traps
Recalls Update - Oct 2, 2014 9:39 - 0 Comments
More In Recalls Update
- FDA Tells Compounder To Recall Contaminated Goods Again
- More Than 200,000 Pairs Of Children’s Sunglasses Recalled
- Cabrinha Recalls Kiteboarding Control System Due To Risk Of Injury
- iDevices Recalls Temperature Probes Due To Ingestion Hazard
- AmTRAN Video Recalls To Repair 42-Inch JVC Flat Panel Televisions