Saturday, Nov 01st
Last update08:10:46 AM GMT
Economic Glance
Citigroup has agreed to pay $285 million to settle civil fraud charges that it misled buyers of complex mortgage investments just as the housing market was starting to collapse.
The Securities and Exchange Commission said Wednesday that the big Wall Street bank bet against the deal in 2007 and made $160 million in fees and profits. Investors lost millions. Citigroup neither admitted nor denied the SEC's allegations in the settlement.
A whistleblower suit unsealed in federal court in Atlanta on Monday alleges that some of the nation’s largest banks and mortgage companies have cheated military veterans and taxpayers out of hundreds of millions of dollars by hiding illegal fees in veterans’ home loan refinancing.
The suit accuses the companies, including Wells Fargo, Bank of America, J.P. Morgan Chase and GMAC Mortgage, of engaging in “a brazen scheme to defraud both our nation’s veterans and the United States treasury” of millions of dollars in connection with home loans guaranteed by the Department of Veterans Affairs.
The State Department is still reeling from deep cuts made by Senate and House appropriations panels to the Obama administration’s budget requests for next year, with some officials warning of national security risks.
Andrew Shapiro, assistant secretary of state in its Bureau of Political Military Affairs, told a meeting last week of the Center for New American Security that the hefty cuts will compromise national security. He noted that the 2012 funding bill for State Department and foreign operations was cut 8 percent by the full Senate Appropriations Committee and a whopping 18 percent by the House Appropriations State and Foreign Operations subcommittee.
The inspector general at the Securities and Exchange Commission has recommended that the Justice Department examine whether to prosecute former SEC general counsel David Becker for helping shape the agency’s policy toward victims of Bernard Madoff’s investment fraud despite having a personal stake in the matter.
Becker was an heir to and executor of his mother’s estate, which included a $2 million account with Madoff. Months ago, a trustee trying to recover money for Madoff’s investors sued Becker to recover fictitious profits paid out when his mother’s account was liquidated.
Inspired by Tahrir Square, those who gathered in lower Manhattan are keen to mount a more permanent protest at corporate influence in US politics.
In the heart of New York's financial district, the marble and concrete floor of lower Manhattan's Zuccotti Park was strewn with untidy clumps of people, gathered in small groups amid a jumble of sleeping bags, mattresses and home-made banners, protesting against the banks and institutions that towered over them.
Continued high unemployment drove the number of Americans living in poverty to a 52-year high in 2010 and pushed the nation’s median household income down for the third straight year since the Great Recession first cast its ominous cloud over the nation’s economy.
More than a year after the economic recovery officially began in June 2009, 46.2 million people were earning below the poverty level in 2010, up from 43.6 million in 2009, according to new U.S. Census Bureau figures released on Tuesday.
At least 25 top United States companies paid more to their chief executives in 2010 than they did to the federal government in taxes, according to a study released on Wednesday.
The companies — which include household names like eBay, Boeing, General Electric and Verizon — averaged $1.9 billion each in profits, according to the study by the Institute for Policy Studies, a liberal-leaning research group. But a variety of shelters, loopholes and tax reduction strategies allowed the companies to average more than $400 million each in tax benefits — which can be taken as a refund or used as write-off against earnings in future years.
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