Banking Misconduct Blog


Appeals Court Enforces Modification Deal

We rarely write about residential foreclosure cases. Although we don’t typically handle cases for individual homeowners, we follow them closely. The same deceitful tricks banks use against helpless homeowners often find their way into commercial cases. Banks have deep pockets and know that...

RICO- Collecting Damages for Lost Profits

There is a tremendous amount of case law surrounding the civil RICO statute. Because it the law provides for treble damages, arguments frequently arise over the proper measure of damages. This is particularly true when the damages claims include lost profits. Given the explosion in RICO claims,...

Banks Put the Squeeze on Oil Companies

More bad news from the oil patch. Oil prices have been at historic lows since the summer of 2014. Although prices have rebounded a bit, prices are still well below the $65 per barrel benchmark that most companies need to be profitable. In recent months approximately 50 exploration and...

LNR Partners - A "Cash Cow" (CMBS Special Servicer Post)

Yesterday Seeking Alpha published an article on Starwood Property Trust, the owner of embattled special servicer LNR Partners LLC. The article hails Starwood as a "cash cow" and worthy investment. Where does Starwood get much of its cash? From LNR.
LNR Partners is the nation's...


Many TIC & CMBS Financed Projects Facing Default

“Rearranging the deck chairs on the Titanic,” that is how I describe the many owners of real estate projects financed with CMBS or tenant in common structures. The ship is sinking, slipping under the surface, yet the party on the upper decks continues. Unfortunately, the folks most at...

Small Banks and Punitive Damage Awards

In 1946, Jimmy Stewart starred in one of the great classic movies, It’s a Wonderful Life. His character was the head of a small local bank. 70 years later, that movie is still played every year at Christmas. One of the great scenes takes place in the bank’s board room. (I won’t...

Court Okays Lawsuit Against BNY Mellon as Mortgage Trustee

Earlier this week, a federal judge in Manhattan gave a green light to a lawsuit filed by an investor against Bank of New York Mellon. The investor claims it lost over $1 billion because of BNY Mellon’s poor performance as trustee over several Residential Mortgage Backed Securities (RMBS)...

Over One Third of CMBS Loans Could Default by 2017

Many CMBS loans are coming due in 2016 and 2017. Morningstar reports that almost half of the maturing Commercial Mortgage Backed Securities loans are overleveraged. That means that they are facing imminent maturity defaults.
According to a report published by Morningstar Credit Ratings, over...

KYC, Lender Liability & Daniel Roho Filho

Citigroup, JPMorgan Chase and Wells Fargo thought Daniel Fernandes Roho Filho was the perfect customer. He was rich and had lots of cash to deposit. Often banks turn a blind eye to the business activities of customers, especially when they believe them to be billionaires.
In 2009, the feds...