Banks Face Multi-Hundred-Million Dollar Settlements

Law professor Donald Langevoort at Georgetown University warns against downplaying the newly launched investigation of eight world leading banks to find out whether they have provided misleading information to credit-rating companies. Langevoort says all cases have the potential to cost the banks a substantial amount of money.

“The fire is there. There’s going to be multi-hundred dollar settlements in order to get rid of them.”

Donald Langevoort

The New York Attorney General Andrew M. Cuomo have launched investigations of eight major global banks because of mortgage ratings concerns. The Attorney General is trying to find out what kind of information the bank was disclosing and giving to the rating agencies, and whether or not the ratings were too optimistic.

Many of the banks are already in trouble and under scrutiny which has led to heightened protests for finance reform.

In addition to this new investigation of mortgage ratings, separate probes have been launched against rating agencies and financial firms on suspicion of market manipulation and misleading information.

RT America pretty much sums it up:

Multi-Hundred Dollar Settlements

Law professor Donald Langevoort at Georgetown University warns against downplaying these investigation, saying that all the cases have potential to hurt the banks and that huge settlements between the banks and the authorities probably is the most likely outcome.

Bloomberg reports:

Related by the Econotwist:

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Wall Street Collapse: Did Somebody See It Coming?

U.S. Stock Crash Compels Further Investigation of Wall Street Scam

Warnings Against Hong Kong Financial Fraud

“We Stand At The Brink Of The Next Great Crisis”

Living In A Derivative World

Are Governments Producing Conspiracy Theories?

Wall Street: FED With A Fake Mustache?

The Truth, Some Truth And Something Like The Truth

AIG: What Did FED Bail Out and Why?

The Great Golden Lie

Italy Charge Foreign Banks With Fraud

Drug Money Saved Banks from Collapse

Organizing Financial Rebellion

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Filed under International Econnomic Politics, National Economic Politics

6 responses to “Banks Face Multi-Hundred-Million Dollar Settlements

  1. This is hard but true. We tend to borrow money, use it, make profit but we do not want to return it, for it is then, when we realize that the interest rate was high and the banks misled us. The banks are always clear on their terms and conditions, its our perception which changes over the course of time. And finally, we end up making settlements.

    Instant payday loans | Borrow money | Quick quid

    • econotwist

      I think your on to something essential here: Credit is not mentioned in the UN’s deceleration of human rights… But somewhere along the way, we’ve come to believe so. (With a little help from our friends at the bank). The result is a massive increase in consumption that is not sustainable, and that’s what we’re dealing with now. It’s going to be tough, I’m sure. My hope is that we can avoid any serious conflicts, and a repetition of the 1930’s and 40’s.

      Thanks for the comment!

      Best Wishes

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