Categories
Music Top Stories

Ghost Founder Sued by Ex-Band Members

So much for anonymity – Up to this point there have been many rumors regarding the band’s identity, but now that’s all changed.  According to Swedish website Corren.se, Tobias Forge aka Papa Emeritus, is being sued. Four of his former bandmates are accusing the Ghost founder of cheating them out of profits from the group’s album sales and tours.

Filed in Linköping, Sweden, the lawsuit states that Forge controls all of Ghost’s business affairs, including managing the band, and does not consult with anyone else in the group.

According to the lawsuit, the band was formed in 2010, under a company started by Forge. The lawsuit claims the former band members were never provided financial statements and they are asking the court to order Forge to reveal the company’s revenues and expenses for the years 2011 through 2016. Forge insists that the company was not yet profitable during those years.  In addition, if Forge fails to produce the requested financial records, the former members are asking the court to enforce a financial penalty of SEK 200,000 (approximately $22,000), or an amount the court deems reasonable.

In 2016, the lawsuit claims that Forge presented two separate contract proposals to the members of Ghost, but both were rejected on the grounds that they were viewed as “slave agreements”. On December 20, 2016, Forge contested, via his attorney, the musicians’ claim that Ghost was a partnership. When asked by Corren.se to comment, Forge said, “I can’t comment on it because it is a legal process. The lawsuit will be answered fairly soon by my legal counsel.”

Just last month, we posted an article on guitarist Martin Persner, who claimed he was a former member of Ghost. Persner, however, is not one of the four members named in the lawsuit against Forge.

 

Categories
Music Top Stories

Josh Alan Quits Bobby Blotzer’s RATT

Earlier today (2/15/17), vocalist Josh Alan released the following statement:

“Good morning, beautiful people! I just want to take a second to bring you all an update. As some of you may already know, I have resigned from my position with Bobby Blotzer/Ratt as of January 23rd. I thank you all from the bottom of my heart for all of your love and support along the way! I would not have made it through this without you!

I will be working and focusing on my original music this year. If you would like to catch me live, I will be doing solo acoustic shows throughout the year as well (what I enjoy most), just check in here for updates!

With that being said, I have had an absolute wonderful time on this tour. I have met a lot of very good people and gained experience that I would not have otherwise. For that, I am forever grateful.

I will leave you with this: What I believe is the most important lesson here for myself, is that music is a universal language. It is a tool…a very powerful tool. It is intended to bring peace, love, and unity. I believe that to use such a beautiful and powerful thing for any other means is a complete disservice to the people! Music is power…unity is absolute power. Let’s enjoy music, and let it bring us together as it is intended to do! Much love, people! Look forward to seeing you soon!”

….and there you go.

Categories
Music Top Stories

Bobby Blotzer on Ratt Drama, “It Sure As FK Ain’t Over”

Ex-Ratt drummer Bobby Blotzer has posted a response after a judge denied his request for reconsideration on February 3rd. Blotzer was kicked out of Ratt and expelled from the partnership as a result of forming his own version of the band and playing live under the moniker Ratt. The new partnership agreement states that Blotzer can only refer to himself as a “former member of Ratt.”

Bobby Blotzer’s Facebook Post (2/13/17):

“Hey Rattlers:
Just a small bit of info regarding the three bland mice show over the weekend and where things stand on the legal side 🙂

“Thing look a lot worse than you think. If those lying thieves or anyone not privy to this knows whats going on, it sure as fk ain’t over. It it were, where’s the judgement?

“PREDICTION: Injunction granted W.B.S. Inc RATT on tour all year.

“Can’t give it all but, I can say with a true tongue, this is definitely not over. Very good surprises coming.

“I saw a video of a couple of songs. Groundhog day.
SOS, Snoor
The Crypt Keeper Pearcy and his 15 year old stage garb,
UGHHHH
Puking
Newz soon. FAHQ
WSJC

BB”

Categories
Interviews

Jack Russell, Great White, Bio-Interview,Self-titled, Stick it,Lawsuit

https://fullinbloom.com/images/jackonboatbottom.jpg

Great White Vocalist

Jack Russell

Part I

full in bloom: It’s a real honor to interview you. Great White was my first concert. It was Great White opening for Judas Priest.

Jack Russell: Yeah. 1984. Defenders of the Faith….it was a helluva ride…it was so much fun. We were right out of the clubs….we toured Europe, the UK with Whitesnake and that was amazing. We came back, the first show was in Niagara Falls. I was sick as a dog…got on stage and had a great time. The whole tour was a blast. Those guys were so fun to tour with and Rob is such a great guy and a great singer.

https://fullinbloom.com/images/jackgreatwhiteoutofback250.jpg

full in bloom: I can still see moments from that concert and there aren’t too many concerts I can even remember.

Jack: That’s awesome. That’s one of the cool things about this business. You touch people’s lives to a point where you’re engrained in their memory. There were bands that I liked…..like seeing Aerosmith….I can remember what chick I was with and what the grass smelled like that day.

Yeah, you know it was a different band then but it evolved….it didn’t lose its edge completely, we just got away from being Judas Priest wannabes and finding our own niche, which was more bluesy. There are still elements of that in our songs….if you look at songs “My World”, “Lives in Chains”…..that’s some pretty heavy stuff.

Lawsuit – Great White

full in bloom: What’s the latest with the Great White lawsuit? Initially it came out that you were ok with them using the name Great White and that you wanted to tour as Jack Russell’s Great White. Then the band announced they would be doing a new record with XYZ vocalist Terry Illous, which resulted with you filing to prevent them from using the name.

Jack: Well yeah, putting an album out as Great White….that’s not Great White. Now they’re having a 30th Anniversary, who are they kidding…..30th Anniversary of what? I fired them all. How can they have an anniversary if they’re all fired. I fired them on December 10th. But they obviously don’t want to be fired. Prior to that, they tried to file for the trademark without me. I could not believe it, my gut was so upset. I had tears in my eyes….I couldn’t believe these guys were my friends. Ok, I cost them some money but then again, I allowed them to go out with other singers. I called Jani (Lane) and said, ‘do me a favor and go out and fill in for me while I get well, so these guys don’t lose money’. Then Terry (Illous) came in and I was cool with that too. In retrospect I should have said no….’you wait for me until I come back’ but that’s not who I am….I don’t want to stop them from earning a living but they sure wanted to stop me. I’m getting emails from these guys, ‘you can only go out there as Jack Russell – formerly of Great White’….from a manager who has only been with the band for the last few years. Screw you buddy. Honest to God, these moves that I am making are not out of animosity….I mean it…..they are just business decisions. Those guys cannot be Great White. There already are too many people going, ‘which version of the band are you in?’. It’s ridiculous. They need to call it something else. It’s a different singer…..and the singer is the one element of the band you cannot change, without completely changing the sound of the band. I don’t care how great the singer is, or how bad. I don’t care if you put Steven Tyler in Ratt, it ain’t gonna be Ratt.

full in bloom: I read somewhere that the reason bands don’t file against each other is because each version of the band would have to stop touring until the matter was resolved, which could take up to two years.

Jack: No. Not true at all. It’s going to go very quickly.

full in bloom: It sounds like the Mark Kendall’s Great White is pretty close to releasing a new album.

Jack: That’s not going to happen. We’re fighting that tooth and nail….it’s a complete farce.

full in bloom: Are you pursuing the rights to use the name ‘Great White’?

Jack: Oh yeah. I do want the name now. If they would have called me up before all this happened and said ‘hey Jack, you know what man, we’re just sick of you, we can’t stand you, we hate your guts but we know where we’ve been, so let’s try to figure out an amicable way so that we can both use the name’. We probably could have figured something out. But the fact that they went behind my back and filed for the trademark, that’s just totally deceptive, that ain’t right.

full in bloom: There was a recent interview with guitarist Mark Kendall where he was saying that you joined his band which later became Great White.

Jack: I joined his band. (laughs) No way. He was in a cover band and he kept bugging me to sing for him and I didn’t want to do it because he was in a crosstown rival band. I had never heard them but of course they sucked because they were our rivals. That was when I was in a band with Audie. I finally went and checked out Mark’s band and the band kind of sucked but he played me some of his own stuff and I said, ‘you quit these guys, I’ll quit my band and we’ll start our own band’, that’s exactly as it happened, may God strike me dead. Then Don Dokken was the one that initiated us getting started here, he brought Alan Niven down to see us. The Dokken connection came from Gary Holland, who had played in Dokken over in Europe. I’ve heard Mark try to take credit for that. No. I just talked to Don the other day and asked him to refresh my memory. He said, ‘I met you guys through Gary Holland and I came down to the studio, heard you sing, loved the voice and said I wanted to work with these guys’. Then he introduced us to Alan Niven and he wanted to sign us to Greenworld. They didn’t want us, so he quit. He said, ‘I don’t know what I’m going to do now, I don’t have a job’ and I said, ‘why don’t you be our manager’. He said, ‘I don’t know anything about managing’ and I said, ‘well, you’re going to learn’…..and learn he did, he became one of the best managers in rock n roll.

https://fullinbloom.com/images/jackgreatwhitegold.jpg

full in bloom: That was cool that you guys stuck with Alan even after the band got signed. Most bands part ways with their manager after they get signed. I didn’t realize that you were Alan’s first band.

Jack: Oh, he was so instrumental, he was instrumental in the whole thing. I think the band would have eventually done its deal but it would have been a harder road. He was a great songwriter and he helped me out a lot. He really helped me become a better lyricist, a better songwriter. I give the guy mass credit. But these guys are trying to change the story. It’s so well documented. I’ve got numerous magazine articles where Mark and I are talking about how the name started and how the band came up. I have the magazines! If he wants to perjure himself, more power to him.

full in bloom: Didn’t Mark quit the band at some point?

Jack: Yes. Mark quit the band and the corporation in 2000. He gave up all rights to it. Here’s the timeline. 2000 Mark (Kendall) left the band. In 2000 I fired Audie (Desbrow) and Sean (McNabb) who was the bass player at the time. In 2001 I did a reunion thing. See John Kalodner with Sony…..I’m the one who got that record deal with Portrait. I went and met with John…he wanted to meet with me only, no managers, just me. He told me, ‘I don’t know if Great White has another album in them but I believe in you, I love your voice, I want to sign you guys’….I was thrilled. We got the deal and did a record. He wanted to do a second record…..I just couldn’t hear the songs and I was kind of leaning toward doing the solo thing. So I told John, ‘no, but thank you’…..he bought us out of the record deal….we did our ‘Thank you….Goodnight’ album, said bye and we were done. I went and did my solo thing, Michael (Lardie) went and played with Night Ranger and Mark went and did his choo choo train band or whatever it was called. My solo tour was rather lackluster as far as attendance went, so I thought, let me call Mark up and see what he’s doing. I hired him as an employee to work with Jack Russell’s Great White. Nobody said anything then. They didn’t say anything when I dissolved the band because they couldn’t; I own the band.

Then in 2005, Mark and I started a corporation called Shark Touring, which I am CEO….it’s split 50/50….and then when I decided to reform the band, we hired Audie, Sean and Michael. They had been getting paid through that corporation until I fired them on December 10th, then they had to start a new corporation to get paid through, but even when I wasn’t in the band, I was still in the band. Even by their own words.

In 1998, I reformed Great White Productions, which was our production company, it is solely my corporation. So from 1998 to 2001 when I dissolved the band, all of their checks were being cut from Great White Productions, which I am the sole owner of…..so they’re employees of mine. I don’t know how you can argue that, it is what it is. It right there on paper. It’s really just sad that it had to come to this because we were all such great friends. Money became more valuable than a friend. I’m in the hospital with a perforated bowel, which means the contents of your bowel get launched into your body cavity causing a horrendous infection. I was in a coma for five days….they told my wife that they didn’t think I was going to make it. During that time, not one of them called to check on me or to even see if I was still alive. That was truly sad…..ok, so I cost you a couple of grand, I embarrassed you but you know what, I was their friend. When they screwed up….they had their issues too. There was a time when Audie couldn’t play on the record because of his addiction. He didn’t play on the ‘Can’t Get There from Here’ album. Mark missed part of the Scorpions tour because of his alcoholism but I was always there for them. So I get ostracized because they got sober before me? Now they just want some puppet on a string singer, a yes man, who is going to do whatever he says. They shouldn’t call it Great White because it’s deceptive, it’s not Great White. I did the hiring, I did the firing, nobody else wanted to be there….I always had to do it all…..because it was my band. Then they file a statement saying that I have no right to use the name? What? What do you mean, I have no right to use it. I have every right to use it.

full in bloom: It is sad, mostly because you guys have stayed together for so long.

Jack: It is sad….it’s horrible. These guys are my really dear friends. I think about them all the time. I think about Audie when we lived at my parent’s house and all the fun we had, I think about me and Kendall hanging out, everywhere we went, we were inseparable. It is really, really sad. The idea of us sitting on a porch one day talking about our old stories. It’s not going to happen anymore.

full in bloom: You and Audie go back to the seventies.

Jack: ’76, man.

full in bloom: In my interview with Tony Richards he said he replaced Audie in the band.

Jack: Yeah Tony Richards. I used to change everyone’s name. Tony’s name was Tony Orlando and I said nope, you’re Tony Richards. Tony Montana, his name was Anthony Cardenas, I said nope, you’re now Tony Montana. Lorne Black.

full in bloom: What happened with the trademark?

Jack: Their trademark application got denied.

full in bloom: They are still acting like the album is coming out.

Jack: Well, we’ll see what happens. I’m not worried about it right now. I’m just trying to get my band sounding better and better, which they are, these guys are hot shots.

full in bloom: What’s in the future for Jack Russell’s Great White?

Jack: We’ve been playing. We’re getting ready to hop on a tour bus tomorrow night. Then we’re going to do the America Rocks Tour for a month, in June, which is a big headline package.

full in bloom: Are there any plans for some new music?

Jack: Oh yeah, we already got some stuff in the can. We’re recording a live album right now and we are going to release it for free. We’re also going to do a video release and release it for free. Why not? You don’t make money from record sales anymore. People don’t really want to hear the new stuff, they want to hear the hits…and I get it. Right now we are swapping songs in and out of the set. If you come to more than one show you are not going to see the same show.

Great White – Self-titled Album – 1984

full in bloom: I love the aggression of the first self-titled album. I love the songs, I love your voice….it was so aggresive……

Jack: Yeah, Jack Evil. That’s what Michael Wagener used to say, ‘sing like Jack Evil’.

full in bloom: Are there any songs in the set from the self-titled era? I’m sure you probably still do ‘Stick It’, right?

Jack: No. We don’t do ‘Stick It’, we do ‘On Your Knees’, which goes into ‘Achilles Last Stand’. I haven’t done ‘Stick It’ in so many years. I just really have no desire to do that song again.

full in bloom: Really?

Jack: I can’t say it will never be done because every time I say that it turns around and bites me on the butt. I wouldn’t mind putting ‘Hold On’ in the set, I love that song.

full in bloom: When was the last time you did ‘Streetkiller’?

Jack: Probably back in ’84, on the Priest tour.

full in bloom: I think those songs, from the first album, were incredible. It was such a raw record…..I still jam it.

Jack: That’s awesome. I’ve got to take a listen to it…I haven’t listened to it in many, many years.

Make sure to read PART II w/ Jack Russell

Categories
Finance

TaxMasters Files for Bankruptcy

Houston-based TaxMasters Inc has filed for bankruptcy protection, according to court documents, after several years of battling allegations of deceptive practices with authorities in Texas and Minnesota. The company, which advertises a service to reduce tax debts by thousands of dollars for consumers, faces a series of charges from the two states over its familiar television ads shown around the country, starring its CEO Patrick Cox and promising the firm will fight with the Internal Revenue Service to reduce clients’ tax debts.

A civil case filed in Texas almost two years ago against TaxMasters got underway Monday after the firm’s latest request for a continuance was denied. Among the charges brought in that case are unlawfully misleading customers about terms in their contracts, failure to disclose a no-refund policy, and making false claims that its employees would begin working immediately on new clients’ cases. In actuality, the company often would not start working on cases until a client had paid all associated fees, leading to many clients missing crucial IRS deadlines.

According to the Minnesota complaint, filed by the state’s attorney general Lori Swanson in December 2010, TaxMasters convinced clients to pay up to $8,000 in upfront fees by promising to reduce their tax debts by up to 90 percent, but ended up delivering very little in actual results in most cases, leaving customers with the same tax burdens but less cash in the bank to pay the debts. Separately, the Better Business Bureau reports that it has received more than 1,000 consumer complaints over the last three years.

According to TaxMasters’ bankruptcy filing, the company has accrued debt of between $1 million and $10 million, and its assets amount to less than $50,000. While the company did not list its creditors in the filing, it did say it has debts with between 1,000 and 5,000 distinct entities. According to its most recent full-year regulatory filing, TaxMasters spent $37 million on advertising in 2010, while reporting a net loss for the year of $4.7 million.

Categories
Finance

Bank of America Announces $8.5 Billion Settlement

Bank of America, the largest US financial institution by assets, announced on Wednesday it would set aside some $14 billion to settle claims related to its questionable practices regarding mortgage backed securities that were among the leading causes of the financial collapse of 2008. Additionally, the bank announced it had agreed to pay $8.5 billion to a group of 22 large investor groups who invested in securities containing poorly documented or substandard home loans from Countrywide, which BofA acquired in 2008. The additional $5.5 billion is being set aside to settle claims to investors that didn’t join in with the group.

The settlement is the largest by any financial firm stemming from the 2008 financial crisis, which led to the worst economic downturn in the nation since the Great Depression of the 1930s. The crash was essentially set off by the crash of complex mortgage backed securities containing millions of faulty, high-risk mortgages. As a result of the settlement and additional liability reserves, BofA said it would be osting a net loss of as much as $9.1 billion for the second quarter, in stark contrast to the bank’s first quarter net income of $1.7 billion.

The bank already posted a $2.2 billion loss for all of 2010 as a result of massive amounts of write-offs, mostly from assets related to housing. “This is another important step we are taking in the interest of our shareholders to minimize the impact of future economic uncertainty and put legacy issues behind us,” the bank’s CEO, Brian Moynihan, said in a statement. “We will continue to act aggressively, and in the best interest of our shareholders, to clean up the mortgage issues largely stemming from our purchase of Countrywide.”

BofA officials noted in the announcement that the settlement will require court approval, meaning that holders of the securities in question not among the 22 groups can still object to it. One of those investors, Bill Fray, who heads Greenwich Financial Services, called the settlement amount excessively small. He estimated that the full value of the faulty securities Countrywide sold at $100 billion, and said he would be happy to take part in a challenge to the settlement.

Over the last six months, Bank of America has announced three separate agreements aimed at reducing its exposure to legacy liabilities related to Countrywide, which at one time was one of the nation’s largest mortgage lenders. The 22 groups involved in Wednesday’s settlement represent some 530 separate trusts who hold some $424 billion worth of mortgage backed securities. Some of the larger investors represented were Goldman Sachs, BlackRock, PIMCO, and even the New York branch of the US Federal Reserve.

Categories
Real Estate

50-State Foreclosure Scandal Settlement Within Reach?

Several reports were circulating Tuesday that seem to indicate federal regulators are nearing a settlement with the nation’s largest banks over questionable foreclosure practices. Attorneys general from all 50 states are reportedly in Washington, DC this week, and are holding meetings to discuss settlement proposals. The investigation is being led by Iowa Attorney General Tom Miller.

Details of a possible settlement vary, depending on the source, but most indicate that a settlement would prohibit banks from initiating foreclosure proceedings while a buyer is actively seeking a loan modification. A settlement would also require lenders to acknowledge mortgage modification requests within ten days. A fine of as much as $20 billion has also been discussed as part of any settlement.

Additional reports indicate that regulators have not ruled out filing criminal charges in the matter after a wide-reaching settlement is decided on. Several sources close to the investigation have hinted that any fine money paid as part of a settlement could be used to pay down the principal on troubled US loans. A number of the rumored provisions of a settlement appear to be in response to the failure of the Home Affordable Modification Program (HAMP), which has severely underperformed based on expectations.

Categories
Real Estate

SEC Considers Fannie and Freddie Charges

The US Securities and Exchange Commission is reportedly considering filing chargers against a number of former and current executives of mortgage giants Fannie Mae and Freddie Mac with violations related to the recent financial crisis. The move would set up a battle between the SEC and the housing regulator charged with overseeing the tow government-controlled entities.

The SEC, whose function is to enforce the nation’s securities laws, claims that at least four senior executives at the two firms failed to provide sufficient information to investors about the companies’ mortgage assets as the nation’s housing market collapsed. But the Federal Housing Finance Agency, the agency charged with regulating the two companies since they were seixed by the government in 2008, disagrees with that assessment.

FHFA officials argue that financial disclosures from the two entities were sufficient, and the agency has sent a letter to the SEC opposing the filing of any charges. Over the last couple of months, SEC officials have sent a series of letters to the executives in question saying that they could face civil charges, though the agency has not yet made a final decision to file them.

The SEC has alleged that executives at Fannie and Freddie misled investors about the potential risk involved with certain mortgage products such as subprime loans. Executives that could face charges reportedly include Fannie chief Daniel Mudd, former Freddie head Richard Syron, former Freddie CFO Anthony Piszel, and current Freddie staffer Donald Bisenius, who recently announced his intention to resign after receiving his notice.

The main allegation against Fannie executives is that they mis-classified certain risky loans as “prime”, while the Freddie staffers allegedly failed to warn investors of potential risks involved with subprime loans.

Categories
Real Estate

Freddie Mac Exec Could Face Charges

A top executive from the government-controlled mortgage agency Freddie Mac has reportedly received notice that regulators my file charges against him for violations of securities regulations in the years leading up to the housing collapse. Don Bisenius, the agency’s Executive Vice President, reportedly received a “wells notice” from the SEC informing him that it is considering legal action against him.

The news comes just a few days after former Freddie CFO Anthony Piszel received a similar notice. Piszel served as Freddie Mac CFO between 2006 and 2008 before moving on to the same post at CoreLogic, where he was forced to resign earlier this month.

Both Freddie and its sister agency Fannie Mae have been under investigation since September 2008 for their role in the housing bust. Both agencies have been subpoenaed for documents related to their accounting in connection with the probe. The companies are also under investigation by the SEC and the FBI for possible corporate fraud.

The government-controlled mortgage giants are also reportedly preparing to ask for more federal aid, with Freddie saying it will need $500 million and Fannie requesting $2.6 billion. Freddie recently reported a loss for the sixth quarter in a row.

Categories
Real Estate

SEC Investigation Into Freddie Mac Heats Up

The US Securities and exchange Commission has reportedly escalated up its probe of mortgage giant Freddie Mac concerning its disclosures to investors, notifying at least one former official that civil charges will be filed against him.

Freddie’s chief financial officer between 2006 and 2008, Anthony “Buddy” Piszel, has been served with a “Wells notice” from the agency, according to Corelogic, where Piszel now serves as CFO. A Wells notice is a notification that SEC staff members intend to file civil charges.

Corelogic reported the Wells notice on February 10th, and said that Piszel had submitted a resignation, but would stay on until June, adding that he intended to submit a response to the SEC soon. Corelogic has declined to make any further comments on the matter, and Piszel has been unavailable for questions. Likewise, SEC officials have declined requests for comment.

In 2008, Freddie officials announced that the mortgage insurer had been subpoenaed for documents relating to its accounting practices, disclosure policies, and corporate governance since 2007. Fannie Mae, having also required government aid to stave off bankruptcy, is also under investigation.

Categories
Real Estate

Fannie and Freddie “Biggest Disasters of All Time”

A congressional panel, the Financial Crisis Inquiry Commission, released audio files of testimony it gathered during its 18-month investigation into the causes of the financial collapse. Included in that testimony was an interview with JPMorgan Chase CEO Jamie Dimon, in which he called Fannie Mae and Freddie Mac “the biggest disasters of all time”, adding that the two now-government controlled entities and their failures were a leading cause of the nation’s financial meltdown.

Colorado Springs Real Estate

Meanwhile, the US Treasury Secretary, Timothy Geithner on Friday outlined three options for unwinding the two mortgage companies in a report sent to Congress. The Obama administration is currently trying to find a way to end taxpayer support for the agencies and gradually decrease the dependence of the $11 trillion mortgage market on the US government. Combined, Fannie and Freddie have been given more than $150 billion in taxpayer assistance since federal regulators seized the two companies in September 2008.

Colorado Springs Land For Sale

Categories
Real Estate

Foreclosure Scandal Penalties Coming Soon

US bank regulators are reportedly close to handing out punishments to mortgage servicers after an investigation into the way foreclosures were handled. John Walsh, who heads up the Office of the Comptroller of the Currency, said that the investigation into foreclosure procedures found that servicers had broken laws, leading to a number of wrongful seizures of Americans’ homes.

“These deficiencies have resulted in violations of state and local foreclosure laws, regulations, or rules and have had an adverse affect on the functioning of the mortgage markets and the U.S. economy as a whole,” Walsh stated in testimony before Congress.

Walsh stopped short of naming specific servicers, but his testimony indicated that Bank of America, JPMorgan Chase, Citibank, and Wells Fargo were all among the banks investigated. The commissioner of the Federal Housing Administration David Stevens, meanwhile, said in separate testimony that penalties could include fines paid to the government and loan modifications to banks forgiving some of the principal balance on loans.

“There are a variety of discussions. There are different views,” Stevens told members of the House Financial Services Subcommittee on Insurance, Housing and Community Opportunity, saying that no final decisions on penalties have been made. When asked when the decisions may come, Stevens answered: “I would say a month timeframe is probably in the reasonable range if we are to reach some sort of conclusion.”

Categories
Real Estate

Banks To Benefit From Unwinding of Fannie, Freddie

The move to unwind mortgage giants Fannie Mae and Freddie Mac is gathering momentum as Congress and the Obama administration continue to debate how to accomplish it. Privatizing of the nation’s finance system could, in the end, represent a significant boost to the bottom lines of US banks.

Obama’s administration, as well as a number of Congressional Republicans, have proposed eliminating the Fannie and Freddie, which have been controlled by the government since requiring assistance in June 2008 to avoid bankruptcy. It is not clear at this point what, if anything, will serve as a direct replacement for the two agencies.

The elimination of the two mortgage insurers will be accomplished gradually, to avoid destabilization of the housing market. Insiders say that some of the companies’ basic functions, as well as some of their staff, will be shifted to other government agencies including the Department of Housing and Urban Development (HUD) and the Federal Housing Authority.

Treasury Secretary Timothy Geithner said Friday the dissolution of Fannie and Freddie could take between five and seven years to complete. Representatives from Fannie and Freddie declined to comment on the proposal.

Categories
Tech

EU Launches Probe Into Google

Antitrust regulators from the European Union announced Tuesday that they have launched an investigation into Google after allegations of discriminating against competing services in its search results and for preventing websites from accepting rival ads.

The investigators will look into Google’s AdSense contracts to see if they prevent publishers from placing competing ads on their sites and will also investigate claims that the search giant limits advertisers’ ability to move data such as search key words from AdWords to other services.

Rivals of Google, including Microsoft’s Ciao, have filed an antitrust suit against the company, and criticism of Google’s practices has come in from French, German, and British data protection regulators over Google’s Street View service, which collects data from private residences.

Antitrust regulators have the authority to levy fines of up to 10 percent of revenues for monopoly abuses. He highest fine levied in the European Union’s history was $1.38 billion, against Intel last year. Advertising accounted for $22.9 billion, or 97 percent of Google’s revenue in 2009. The company has denied the allegations.

Shares of Google fell $18.66, or 3.2 percent, on the news, to $563.45 as of 10:00 AM on the Nasdaq stock exchange.

Categories
Real Estate

Freddie Mac Under Self-Imposed Investigation

The Associated Press has revealed that Freddie Mac has hired lawyers to investigate their own two million dollar lobbying campaign designed to stop regulations against the company before the recent crash of the housing market. It is unknown at this time how much the investigation will cost or whether federal bailout money will help pay for it. The firm was put under government control in November because of extensive debt. A leadin Washington, D.C. law firm, Covington and Burling LLP, has been conducting interviews with current Freddie Mac employees and persons no longer with the firm. All persons interviewed are cooperating on an anonymous basis. The lead investigator in the inquiry is a former Justice Dept. prosecutor named Stephen Anthony, whose legal specialty is corporate inquiries.

The Chairman of the Board of Freddie Mac, John Koskinen, has confirmed the investigation before declining further comment. Investigator Anthony has not been available for comment. The investigation is ongoing whilst President Obama recently awarded an additional $200 billion in government assistance to the financial giant and the even bigger mortgage company, Fannie Mae. The governing body in control of Freddie Mac’s business activities is the new Federal Housing Finance Agency.

The investigation was spurred by accusations that the firm hired DCI Group, a Washington consulting agency, to prevent the passing of a bill that would have forced Fannie Mae and Freddie Mac to liquidate hundreds of billions in assets. The chief sponsor of the bill was Senator Chuck Hagel, a Republican from Nebraska. The DCI group failed to file lobbying reports detailing the services they provided for Freddie Mac. Insiders say that executives at Freddie Mac aware of the initiative nicknamed it “the stealth lobbying campaign.” A DCI Group spokesman claims that no laws or regulations were broken and that the highest ethical standards were adhered to.

Investigator Anthony’s investigation centers around 3 key issues raised by AP stories:

A disclosure of the work done by DCI Group for the two million it received from Freddie Mac. The efforts reportedly were aimed at 17 Republicans in the Senate from 13 states with the goal of defeating Sen. Hagel’s bill, which was never voted on.

Details of work performed by 52 outside lobbying agencies and political consultants who received substantial payments from Freddie Mac totaling in excess of eleven million dollars. The consultants in question include former Speaker of the House Newt Gingrich and former Senator Alfonse D’Amato.

Disclosure of personal use by the firm’s executives of company-purchased tickets and a skybox at the Verizon Center.

This is not the first time Freddie Mac has hired Covington and Burling. The firm has represented Freddie Mac in around twenty lawsuits charging the company with falsely inflating its stock price from 1999 to 2002. All the suits have been settled. They also represented Freddie Mac when it was charged with making illegal campaign contributions, a matter the company was fined almost $4 million by the Federal Election Commission for.