[THS] !! What Does Wikileaks Have on Bank of America?

Sat Jan 15 14:13:36 CET 2011

http://www.informationclearinghouse.info/article27259.htm

What Does Wikileaks Have on Bank of America?

By Mary Bottari

January 14, 2011 "BanksterUSA" --- WikiLeaks founder Julian Assange is promising to
unleash a cache of secret documents from the hard drive of a U.S. megabank
executive. In 2009, he told Computer World that the bank was Bank of America
(BofA). In 2010 he told Forbes that the information was significant enough to "take
down a bank or two," but that he needed time to lay out the information in a more
user-friendly format.

Recent new reports suggest that BofA is now moving into high gear on damage
control, creating a "war room" and buying up hundreds of derogatory Internet
domain names including BankofAmericaSucks.com and BrianMoynihanblows.com
(referring to BofA's Chief Executive Officer).

Before the big banks start calling for Assange's internment at Guantanamo, the
question worth considering is what does Wikileaks have on America's largest bank?

Legal Liability for Toxic Mortgages

BofA is already under the gun, defending itself from multiple lawsuits from private
investors as well as Fannie and Freddie demanding that the bank buy back billions
worth of toxic mortgages-backed securities. The firm stopped issuing subprime
mortgages in 2001, but it kept underwriting subprime mortgage-backed securities for
many years. In September 2009, for example, BofA underwrote $239 million worth of
securities backed by subprime loans. BofA has reserved a mere $4.4 billion for these
"put back" lawsuits. If Assange has emails showing that top executives at BofA knew
they were peddling toxic dreck to investors, it would rock the firm and give
tremendous ammunition to the army of lawyers already knocking on BofA's door.

Reckless and Illegal Foreclosures

BofA is at the heart of the robo-signing scandal and has wrongfully foreclosed on
countless American families. One poor woman returned to a vacation home to find it
locked, all her possessions gone -- including the ashes of her late husband. How
could such a mistake be made? A BofA employee deposed in February 2010 said that
she signed as many as 8,000 foreclosure documents a month without reviewing
them, in violation of the law. Mounting questions about the fraudulent and illegal
foreclosure practices at the big banks and mortgage service companies prompted
BofA to temporarily halt foreclosures nationwide in October, 2010. If Wikileaks can
document that top BofA officials have a callous disregard for legal processes and
constitutionally protected property rights, BofA's mounting legal liability may not be
sustainable.

Headaches Left Over from Countrywide

In 2008, BofA acquired Countrywide, one of the most aggressive and fraudulent
lenders during the housing bubble. The result has been a train wreck of liability and
lawsuits for the megabank that now has over 1.3 million customers in foreclosure. To
settle the lawsuits with Illinois, California and eight other states over predatory
lending, BofA came up with an $8.4 billion loan relief plan for those holding
Countrywide mortgages. In June, 2010 BofA paid $108 million to settle a Federal
Trade Commission case that charged Countrywide with having extracted excessive
fees out of borrowers facing foreclosure. BofA paid $600 million in August 2010 to
settle shareholder claims that Countrywide had concealed the riskiness of its lending
standards. There is no end in sight for these types of claims, and more. In June,
2010 the State of Illinois sued Countrywide again, this time over racial discrimination
in its lending practices. Wikileaks could have further documentation of Countrywide's
illegal and reckless underwriting practices or ongoing fraud at BofA.

Illegal Bonuses Paid by Taxpayers

Bank of America acquired the brokerage firm Merrill Lynch for $50 billion in January
2009. The U.S. government blessed the merger with a $20 billion bailout loan to aid
BofA. After the acquisition went through, it was revealed that Merrill Lynch had lost
$15.8 billion in the last quarter of 2008 and that $3.6 billion in bonuses were paid
ahead of schedule to top executives at Merrill. Among beneficiaries of the bonus
bonanza was Merrill's CEO John Thain, who famously spent a million redecorating his
office at the height of the crisis. About the deal New York Attorney General Andrew
Cuomo said: "One disturbing question that must be answered is whether Merrill
Lynch and Bank of America timed the bonuses in such a way as to force taxpayers to
pay for them through the deal funding." If Wikileaks has emails showing top
executives knowingly used bailout bucks for bonuses, this ugly chapter in history
could be reopened, prompting Congressional investigations and further bailout
backlash.

Still Too Big to Fail

In addition to the $25 billion in TARP bailout money and the $20 billion for purchasing
Merrill, America recently learned of the extraordinary actions taken by the Federal
Reserve to prop up BofA at the height of the crisis, details that were kept secret from
the public. When the Fed was forced to release data about its emergency loan
programs in December 2010, we found that BofA tapped an estimated $931 billion
from the Fed in short term loans and government subsidies. If Wikileaks has
information showing that America's biggest bank is only being kept alive by
accounting tricks and ongoing government subsidies, the result could be another
government bailout or potentially the orderly dissolution of a firm that is "too big to
fail" and still poses a threat to our nation's economy.

"We Don't Suck"

BofA doesn't just want you to know that their CEO Brian Moynihan doesn't suck, they
want you to know that their top staff does not suck either. The bank has started
buying damaging domain names for a long list of executives, prompting many to
wonder: just what have those executives been up to over there at BofA?

Hopefully Wikileaks and Julian Assange will soon let us know.