Compliance

Bank of America Corp.'s proposed settlement of mortgage-backed securities claims against its Countrywide unit would force private-label investors in 530 Countrywide trusts to accept the bank's $8.5 billion offer, B of A officials said Wednesday.

Bank of America's pending settlement related to hundreds of billions of dollars worth of Countrywide-issued first-lien RMBS released Wednesday would include not only an $8.5 billion cash payment to trusts involved but also about $400 million of servicing changes and improvements, according to an investor law firm involved.

Suspicious activity report filings involving mortgage fraud rose by 31% in the first quarter, largely as a result of the large number of repurchase demands by investors.

A Dallas homebuilder pleaded guilty last week in the U.S. District Court for the Eastern District of Texas to a mortgage fraud scheme against homebuyers.

Freddie Mac has entered into a proposed settlement with creditors of the Taylor, Bean & Whitaker Mortgage Corp. bankruptcy that will allow the GSE to gain control of TBW-related mortgage servicing rights and $54 million in loan receipts in TBW deposits.

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.

Morgan Keegan & Co. Inc. will pay $200 million in restitution to subprime and mortgage-related bond fund investors to settle multi-regulator enforcement proceedings related to improper marketing and insufficient disclosures.

J.P. Morgan Securities LLC will pay $153.6 million to settle Securities and Exchange Commission allegations that it misled investors in a complex mortgage securities transaction just as the housing market was starting to plummet.

The National Credit Union Administration said Monday it has filed two suits against securities firms alleging violations of federal and state securities laws and misrepresentations in the sale of hundreds of mortgage-backed securities.

Radian Asset Assurance announced the successful acquisition of Municipal and Infrastructure Assurance Corp. (MIAC) on Thursday, following the approval of its regulator, the New York Insurance Department.

Ultimately, Ocwen Financial Corp.'s pending purchase of Litton Loan Servicing is likely to benefit the investors in the $45 billion of mortgages that Litton manages and some of the homeowners. That's because Ocwen has a record of moving faster than Litton to resolve troubled loans, either through modification or foreclosure.

Wells Fargo & Co. decided to exit reverse mortgages after federal officials insisted it foreclose on elderly customers who were behind on property tax and insurance payments, a Wells executive wrote in an email to business contacts Friday.

Two loan processors who defrauded lenders of $6 million have been sentenced to prison terms that will last from two to five years.

The final defendant who participated in a mortgage fraud ring conspiracy that resulted in $10.6 million in loan proceeds through false property transactions has been sentenced.