Schadenfreude: foreclosure edition

Remember the Steven J. Baum P.C. firm that specialized in foreclosures? The one whose employees mocked the folks they foreclosed on at the Halloween party? This one.

It had to go out of business. Something about that rotten no good Nocera writing a column about them resulting in lost business.

Of course, the legal hassles over the years with the federal gov't and the NY AG's office may not have helped.

Nocera seems unrepentant.

I need to seriously work on my Christian charity.

The Bank of America saga continues...

We started off talking about a few mistakes the Bank of America, the once well regarded bank from North Carolina (it was actually Nations Bank which acquired B of A). That was right after they wanted to charge everyone a $5 bank card fee.

It seems the folks at the Bank of America are still covering themselves with glory. Even while they face layoffs of 36,000 employees they can still make little mistakes. Like these:

Konstantinos Alexopoulos opened up an account at Barnett Bank -- which was ultimately acquired by BofA -- in 1992 when he came to the United States for college, the Tampa Tribune reports. He returned to Greece in 1997 and continued making deposits to the account totaling $59,000 in 2003, but when he checked his balance in 2005, it had dwindled to $1,400.

Alexopoulos alleges that's because the bank mixed up his account with that of another man of the same name, who subsequently withdrew the money, according to the Tribune.

If Alexopoulos' claims hold up in court, it would be far from the first BofA mix-up. The bank also gave the same 10-digit account number to two customers in Riverside, California, according to a July report by the Los Angeles Times. One of the customers -- an 88-year old World War II veteran -- ended up losing out on $30,000 worth of social security payments as a result. After an investigation by the San Bernardino County district attorney's office, he ultimately got the money back.

In September it was reported that a Hawaiian woman sued BofA after she received computer-generated calls as often as every 15 minutes from the bank over a missed mortgage payment, while she was grieving for her recently deceased husband.

BofA has also had some notable blunders issuing foreclosures. The bank threatened to foreclose on a Utah couple's home earlier this month, after they had already sold it. The bank also tried to foreclose on a home last month that was destroyed by Hurricane Ike in 2008. In addition, the bank asked a Massachusetts man in August to pay a $0.00 balance to stave off foreclosure.

You will note that since Mr Alexopoulos is having to sue the bank, the good folks of BofA have no intention of making good his losses. It's not their fault they gave away his money to someone else. It's HIS fault for having the same name as another customer (and presumably the same account number, and the same Social Security number, etc.)

BTW, this was after you and I put up a LOT of money to save their asses not that many months ago. Gives me an especially warm feeling when I see their giant headquarters building when I drive to Charlotte.

Why you are not needed

By the big banks anyway. This is why 5 November for the big boys was simply an opportunity to shed a lot of individual little customers who are more of a nuisance than a revenue source. It is the big bucks that count, not your little piddly accounts. So get thee to a Credit Union! Unless, of course, you are someone I am not aware of personally knowing.

Someone who is ready to invest in the new Wells Fargo bank. Unless you have $50 million or more you aren't wanted. What do they focus on for the folks who pass the entrance exam?

Abbott Downing is named after a 19th century custom carriage builder who catered to the wealthy, according to UPI. The firm has $27.5 billion in client assets and about 300 people on staff -- including psychologists and staff dedicated to building family genealogies, the Chicago Sun-Times reports.

"Abbot Downing goes beyond traditional wealth planning analysis by focusing on clients' values, goals and vision," James Steiner, who will run Abbot Downing, said in a statement. "Our advisors and Family Dynamics consultants focus not only on traditional wealth planning, such as cash flow, investments and wealth transfer, but also on human dimensions, such as family legacy, governance, leadership transition, family education and risk management."

Sounds good. Values beyond traditional wealth planning. Human dimensions. Good. Let's see, family legacy, governance, leadership transition, family education and risk management.

In other words, for the truly rich, "values, goals and vision" are all about ... "Me, myself, and my family." Hence the family genealogies, which at first I thought were strange in this context. Charity, community, giving, the public weal, none of that is on the list. I am not sure but I think that 'governance' here means lobbying and rent taking rather than public service.

Even the notoriously socially inept, long suspected aspergers child Bill Gates learned to do better than this. Much better. No sarcasm intended on that - Gates deserves great respect for his public giving. These Abbot Downing folks and their ilk, not so much.

the me generation with money. great.

Bank of America, the home state bank

Once North Carolinians were proud to call Bank of America a Tarheel bank. It seemed well run and actually avoided many of the moral and professional lapses of most other banks. The ones that nearly destroyed the world economy and put paid to Western Civilization.

That was then.

Now - they are an embarrassment. This is just the latest installment of the Bank that can't shot straight.

not only too big too fail, too big to run efficiently: Clemens' First Law of Bureaucratic Growth.

Bankers Bane

I mean a bane to us. Here is the latest from those wonderful folks who helped bring on the greatest recession in personal memory.

J.P. Morgan Chase said Friday it will pay $27 million to settle a class-action lawsuit that accused the bank of overcharging members of the military for their mortgages and prompted a federal investigation, a congressional hearing as well as public outrage.

In the suit, Marine Corps Capt. Jonathon Rowles charged that the bank refused to lower the interest rate on his mortgage, as required under a federal law, after he was activated for duty. When Rowles refused to pay the higher rate, the bank called his home up to three times a day and threatened to foreclose, according to the suit, which was filed in July.

All of which is against Federal law. Chase probably thought they were jsut helping the war effort I suppose.

bonuses all around, if not a governorship somewhere

Bankers: our best and brightest

I have been gratified to see the torrent of end of decade retrospectives, many from newspapers and magazines on the web, pointing out how awful the decade has been on the reputations of most of our institutions and their leaders. I've been harping on that for some time now. No body's rep survived the Double Zeros.

So let's look at bankers, the super remunerated captains of finance who were so brilliant they had to be paid ka-zillions or they would go work for someone else.

Right now they are racing to beat the clock before the new banking regulations go into effect so they can replace the $50 billion they will lose when certain business practices are banned. They intend to change their rules, charge new fess, and anything else they can think of. In many cases you will pay a fee for having a credit card and another fee for having a checking account. This must be true for I read it in the Wall Street Journal.

The interesting part of this article though is this:

The changes come against a backdrop of rising anger at the nation's banks—having been largely supported by hundreds of billions of public bailout dollars in late 2008 and 2009. One recent survey by Chicago's Bank Administration Institute found that 43% of retail-bank executives feel that consumer trust in banks has eroded in the past six months.

ONLY 43% of these guys think the public is losing faith in them!!!!. What's wrong with the other 57%? Delusional? Out of touch? Vacationing in the Tuva Republic?

Or are they simply the smart ones who figured that the public faith in banks had eroded as far as it could erode long ago?

Banks in Canada

Over on the Washington Post today Steven Pearlstein has done a Q & A with the public (for his column referred to in much of the discussion, click here). Someone asked him how the Canadian banking system seemed to be in so much better health than the American. His reply:

The Canadians have a more logical regulatory structure, as I understand it. They also have more respect for civil servants and government in general, and bank regulators in particular -- the Canadian public, for some reason I never understood, gets very agitated when banks make too much profit. Kind of a populist thing from the prairie. But what's also at work is that their banks are simply more conservatively run and haven't got caught up in the kind of silly and dangerous competition that the big American banks have.

The Canadian Way. I always thought it was much like the Minnesota Way until Minnesotans decided their distinctive heritage could be safely relegated to "The Prairie Home Companion" and joined the national culture.

alas poor Anoka.

Some more on the stock market

In regard to turning any portion of Social Security into an investment portfolio, I am against it, while Jack, for one, would like to give it a try. One point I wasn't trying to make, but could, is that the American public in general (and government programs have to work "in general") does not move on an historic timeline. A few years of poor returns plays hob with most people's retirement plans. In today's Washington Post there is an interesting Q & A regarding financial advice with Jeff Mortimer, chief investment officer for Charles Schwab Investment Management.

Anonymous: I am retired now, have lost half of my 401-k. Please! What do I do right now?

Jeff Mortimer: You are not alone. Understand that I have been traveling the country and have spoken to many in similar situations. I know this may not make if any easier for you, but wanted to at least share that information w/you. Regarding what you can do about it. Here is what you shouldn't do. Don't expect the equity market to quickly return to 14,000 and all your issues to go away. Don't increase your allocation to stock looking to get it back. Instead you should modify your lifestyle to live with less. This is difficult answer to hear, but become the best option out of many. A part time job, a consulting gig, some other ways to bring in money may also ease some of the stress you're feeling. Spend less. Save more. Focus on the liability side of your balance sheet. Touch medicine, I know. But it is the best advice I have to offer.

That seems to make the point clearer than I could. 401-ks are in trouble and the fact that over the next 10, or 5, years they will improve doesn't seem to be much help according to these two. But as an economist, I make a good historian.

of course, if those guys were so smart ....

Is it the economy, or are you just happy to see me

The economic solution. Just watch it.

Without Comment

The wonderful wizards of Wall Street

I just watched the You Tube clip of "The Wizard of Oz" where Toto pulls the curtain back to reveal the pathetic little humbug who has been terrorizing the good folks of Oz into worshiping him like a god.

Reminded me of this article I read this morning in the New York Times about the merger between Merrill Lynch and Bank of America: both led by men formerly hailed as financial wizards.

Which reminded me of my favorite quote about history: a tragedy for those who feel and a comedy for those who think.

I think

Bankers: Just in case you didn't despise them enough

Bank of America, feeding at the public trough while still compensating their executives and managers as if they were little Sun Kings, has a plan for making ends meet. I mean, beyond pleading for another massive bail out from the Feds.

Trick the relatives of deceased credit card holders into thinking they have to pay of the balance of their dead loved one's card.

Here are the details.

kind of gives you a warm fuzzy feeling that they are doing all they can to remain solvent, doesn't it?

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