Compliance & Regulation

In the first two of what promises to be several legal actions seeking compensation for the corporate credit union crisis, the National Credit Union Administration sued two of the biggest Wall Street banks last week seeking to recover losses from the now-toxic mortgage-backed securities they sold to four of the five failed corporates.

Short sale fraud is estimated to rise by 25% in this year of 2011. Unnecessary losses related to risky short sales are approximately $375 million annually according to CoreLogic.

Deutsche Bank and a New Jersey homeowner have reached a compromise to settle a foreclosure action that has been taking place for the last two years.

A court-appointed judicial hearing officer who previously had said e-mails sent between New York Insurance Department officials showed bias regarding the restructuring of bond insurer MBIA Insurance Corp. last week reversed his decision.

A new avenue of attack may be opening up for investors seeking to force big banks to buy back billions of dollars in mortgages: drag the trustees into the fight.

Michigan attorney general Bill Schuette has issued subpoenas against three national mortgage servicing providers as part of a criminal investigation pertaining to questionable mortgage documentation filings during the current foreclosure crisis.

The $200 million civil settlement with Regions Financial Corp.'s brokerage unit last week was the sort of case that the Securities and Exchange Commission and state regulators believe should guide industry behavior.

Shortly after Cornerstone Residential Management company settled a class-action lawsuit claiming discrimination against families with minor children, the housing developer was hit by another lawsuit alleging it has violated Fair Housing Act protections for people with disabilities for decades.

The Department of Justice has more than 15 "open investigations" into violations of the nation's fair lending laws, probes that could lead to charges against lenders if a pattern of abuse is uncovered, according to a key department official.

The Consumer Financial Protection Bureau will be seeking a second round of public comments on its prototype mortgage disclosure forms next week.