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The FDIC Wants $900 Million From Former WaMu Exes, Their Wives

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As you may have heard, the FDIC has sued three former Washington Mutual execs, including CEO Kerry Killinger, COO Stephen Rotella, and home loans president David Schneider, whose "extreme and historically unprecedented risks with WaMu’s held-for-investment home loans portfolio" resulted in the bank's collapse (according to filing, the bank's chief risk officer told Killinger WaMu's "DNA" was missing "the risk chromosome," a few weeks before it went into receivership, to which Killinger likely scoffed and called the guy a pussy). The regulator wants $900 million from the trio and they're not the only ones Sheila Bair says better start cutting checks- Killinger and Rotella's special lady friends (Linda and Esther) have been named in the suit as well.

During the period from January 2005 to September 2008, Defendants collectively received more than $95 million in compensation. As the losses mounted in the Spring and Summer of 2008, Killinger and Rotella recognized the potential problems and took steps to move at least part of their wealth beyond the reach of their creditors.

These steps apparently included shifting a few million and transferring property in Shoreline, Washington and Palm Desert to Linda Killinger's name and in the case of the Rotellas, transferring "in excess of one million dollars to Esther, in addition to putting a resident in Orient, New York in her name.

What do the defendants have to say about all this business? According to Killinger, the FDIC should be ashamed of itself. The suit is "baseless and unworthy of the government," he huffed in a statement this morning.

FDIC Sues WaMu Executives [WSJ]
Highlights From The WaMu Lawsuit [WSJ]