Regulation

FHFA recovers $8 billion from settlements with financial institutions in 2013

fhfaThe Federal Housing Finance Agency announced on Thursday that in 2013, it recovered nearly $8 billion in taxpayer funds through settlements with financial institutions that sold private-label securities to Fannie Mae and Freddie Mac leading up to the financial crisis.

In 2011, the FHFA filed suit against 18 financial institutions alleging violations of securities law and fraud in some cases. The FHFA said the complaints “reflect FHFA’s conclusion that some portion of the losses that Fannie Mae and Freddie Mac incurred on private-label mortgage-backed securities are attributable to misrepresentations and other improper actions by the firms and individuals named…”

This year, the FHFA recovered $6.25 million from GE, $250 million from Citigroup, $885 million from UBS Americas, $4 billion from JPMorgan Chase, $1.93 billion from Deutsche Bank and $475 million from Ally Financial. The agency also recovered $335 million from a non-litigation settlement with Wells Fargo.

Remaining cases include those filed against Barclays, Bank of America, Credit Suisse, First Horizon National, Goldman Sachs, HSBC North America, Merrill Lynch, Morgan Stanley, Nomura Holding America, SG Americas, RBS and Countrywide Financial.

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