In the first day of Senate testimony on the collapse of Washington Mutual, we learn the bank knew about rampant mortgage fraud going on in its various branch offices. The fraud includes the typical shenanigans like lying on income statements of borrowers, fake employment statements, etc.
But the real bombshell occurred after WaMu discovered the fraud in their own investigation and still decided to package the mortgages into mortgage-backed securities and sell them off to Wall Street. Oops. It seems WaMu didn’t care that much about about the fraud (they even awarded certain loan officers with trips to Hawaii) and those packaging the securities never asked whether the fraud-tainted mortgages had been removed from the securities they were packaging.
“You had evidence of fraud and you didn’t check” that the mortgages were not part of the securities, asked Sen. Carl Levin, chairman of the committee looking into the bank’s failure. David Beck, WaMu’s former head of capital markets, said he didn’t ask. “Isn’t that your job,” Levin said. Beck said it was someone else’s responsibility.
“These are securities that happened on your watch,” Levin said.
wow trips to Hawaii… those guys were livin’ large
Hi everybody!
A friend just turned me on to this site and told me it’s really funny. I just read my first post here about WAMU and its mortgage fraud. My stomach is killing me from laughing so hard. WAMU sold junk mortgages to Wall St? Ha ha ha! This is great! Looking forward to the next post!
You guys should do stand up!
NYB Branch Manager
Pace MBA
Zach -
When I awake in the morning, the first thing I do is pinch a loaf. I call it taking a Kouwe. You douche.
Love,
Mom
@2 MBA vs. CFA?
Hey @4 thanks for the question! @2 here.
I busted a gut on reading this post but let me try to answer your question if I can compose myself.
I went for the MBA since I could not fit CFA studying in with my ESL class schedule.
Hope it helps!
And thanks again to everyone for the warm welcome. I love this site!
And yet Killinger is going to appear later and blame the regulators…
@5,2 – Thanks for the response. I do agree that the writing on this site is hilarious. I suspect this Zach guy will get picked up by a major paper. I see a Pulitzer in his future!
Regarding the MBA; Did you do a full time MBA program or an EMBA program? What are the relative merits of both? Also, can you do a traditional MBA via correspondence? I’m looking at the University of Phoenix, but I don’t know how seriously it’s taken on “the street”..
Thanks for the help!
I just took a very pleasant after lunch Kouwe.
Ha Ha Ha! Yes! Like they say in my country, no problem!
– Black guy from CS photo
Did Alan Fishman ever return the money for his brief stint as CEO?
I’ve already Kouwe’d thrice today.
Shut the fuck up, Kouwe
We love Wamu and with the help of Obama and other black activist representatives and senators, forced these banks to give these loans to people who should NEVER have gotten them.
Dont blame the bank for repackaging the loans. They have shareholders…
@11 – You might want to see a doctor about that. They say if a Kouwe lasts longer than 4 hours, you should seek immediate medical treatment.
The CDO^5s of 2099 are still doing fine according to the rating agencies. There was no fraud involved there.
The other stuff would have been fine too, if not for that dude with the dark eyebrows and his big mouth….
@9 – examine your motives…before your cube looks like the one in the cs photo.
If I knew where Zach’s desk was, I would take an enormous Kouwe right on top of it.
I was ounding my secretary in the @ss, and Kouwed right on her back
the comments on this post are funnier than anything Kouwe has written here.
Kouwe is going to copy and paste all of your hilarious comments into his future articles
http://www.nypost.com/p/news/business/item_4T7U6r1qJ4Kn97bWfXao8O
Kouwe wrote a lot about WAMU before JPM got the deal of the century when the FDIC gave it to them for only $1.88bn. So if Kouwe had a batline to TPG- WAMU’s $2bn PE investor… why didn’t he try to report out the real problems in WAMU’s balance sheet months before this happened. TPG would have known the truth and could have given him access to players inside the bank.
He got some good details on how TPG was going to loose out on this deal at the end of it but what did he trade to not report out the whole story?
Kouwe,
I can only hope a CS analyst shows up in your mom’s basement after a night of heavy drinking and destroys your bedroom