Sam Seder interviews Yves Smith, author and founder of Naked Capitalism.com

[Poboy]

Note: About two thirds in the interview, the real scandal within government itself as well is discussed...



Monday, March 14, 2011 <54:33> Hide Player | Play in Popup | DownloadGuest: Author and journalist Yves Smith

Yves Smith, author and founder of Naked Capitalism.com joins Sam to discuss the recent dump of Bank of America emails by the hacktivists Anonymous and she explains what they expose about the way BOA made tons of money in an insurance scam.Check out Yves Smith’s book ECONned: How Unenlightened Self Interest Undermined Democracy and Corrupted Capitalism

interview-
http://official.fm/track/222181

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Entire show (well worth a listen as Sam went to WI. on Friday-Sat. and has clips from the trip aa well)
http://majority.fm/2011/03/14/monday-march-14-2011/#more-1274

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Related material-

“Anonymous” Whistleblower Charges BofA With Large Scale Force Placed Insurance Scheme With Cooperation of Servicers

03/14/2011 - Yves Smith

Ooh, this is ugly.

The charge made in this Anonymous release (via BankofAmericaSuck) is that Bank of America, through its wholly-owned subsidiary Balboa Insurance and the help of cooperating servicers, engaged in a mortgage borrower abuse called “force placed insurance”. This is absolutely 100% not kosher. Famed subprime servicer miscreant Fairbanks in 2003 signed a consent decree with the FTC and HUD over abuses that included forced placed insurance. The industry is well aware that this sort of thing is not permissible. (Note Balboa is due to be sold to QBE of Australia; I see that the definitive agreement was entered into on February 3 but do not see a press release saying that the sale has closed)

While the focus of ire may be Bank of America, let me stress that this sort of insurance really amounts to a scheme to fatten servicer margins. If this leak is accurate, the servicers at a minimum cooperated. If they got kickbacks, um, commissions, they are culpable and thus liable.

As we have stated repeatedly, servicers lose tons of money on portfolios with a high level of delinquencies and defaults. The example of Fairbanks, a standalone servicer who subprime portfolio got in trouble in 2002, is that servicers who are losing money start abusing customers and investors to restore profits. Fairbanks charged customers for force placed insurance and as part of its consent decree, paid large fines and fired its CEO (who was also fined).

Regardless, this release lends credence a notion too obvious to borrowers yet the banks and its co-conspirators, meaning the regulators, have long denied, that mortgage servicing and foreclosures are rife with abuses and criminality. Here’s some background courtesy Barry Ritholtz:



More at http://www.nakedcapitalism.com/2011/03/wikileaks-whistleblower-charges-bofa-of-engaging-in-large-scale-force-placed-insurance-scheme-with-cooperation-of-servicers.html


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ECONned: How Unenlightened Self Interest Undermined Democracy and Corrupted Capitalism
Yves Smith

[Poboy]

1. Wow, no interest, eh? Okay.

To the person who gave this a recommend, thank you.

[NuttyFluffers]

2. kickey poo!

'cuz i loves me some Sammy.

[Poboy]

3. And I will reply to your reply to 'kickey poo' this thread once more!

:hi:

Sam kicks ass.

[smokey nj]

4. K&R!

Sam always does a great interview!

[Poboy]

7. Thank you for your endorsement as well!

[nashville_brook]

5. listened this morning! great interview!

[Poboy]

6. Hello there NBrook. Thank you for the Sam endorsement!

[nashville_brook]

8. regular listener...i like his podcast better than the old Air America show.