No Criminal Case Is Likely in Loss at MF Global (Dealbook)
A criminal investigation into the collapse of the brokerage firm MF Global and the disappearance of about $1 billion in customer money is now heading into its final stage without charges expected against any top executives.
After 10 months of stitching together evidence on the firm’s demise, criminal investigators are concluding that chaos and porous risk controls at the firm, rather than fraud, allowed the money to disappear, according to people involved in the case.
Goldman Sachs won’t face U.S. charges for mortgage securities (LA Times)
WASHINGTON — The Justice Department said it would not pursue criminal charges against Goldman Sachs Group Inc. or its employees related to allegations by a Senate panel that the bank deceived investors and Congress about its activities in the subprime mortgage market.
After an “exhaustive review” that began last year, investigators “concluded that the burden of proof to bring a criminal case could not be met based on the law and facts as they exist at this time,” the Justice Department said in a statement released Thursday night.
U.S. drops criminal probe of former Countrywide chief Angelo Mozilo (LA Times)
Federal prosecutors have shelved a criminal investigation of Angelo R. Mozilo after determining that his actions in the mortgage meltdown — which led to $67.5-million settlement against him — did not amount to criminal wrongdoing…
“Sometimes the public thinks all you have to do is to indict someone and that’s it,” one of the federal sources said. “But you have to be able to prove your case, and it can be worse losing a case than not bringing one at all.”
UPDATE 8/22/12: Meanwhile,
BUFFALO, NY—U.S. Attorney William J. Hochul, Jr. announced today that Timothy McCabe, 47, and Theresa Morales, 48, both of Hypoluxo, Florida, were indicted by a federal grand jury for bank fraud. The charge carries a maximum penalty of 30 years in prison, a $1,000,000 fine, or both.
Assistant U.S. Attorneys Maura K. O’Donnell and Kathleen A. Lynch, who are handling the case, stated that according to the indictment, the defendants submitted a fraudulent loan application to a financial institution, JPMorgan Chase Bank, to obtain a $560,000 mortgage on a property in Lewiston, New York. The defendants, who are husband and wife, provided false information in the loan application as to employment, salary, and residency. The defendants conduct resulted in foreclosure on the property.
This law enforcement action is part of President Barack Obama’s Financial Fraud Enforcement Task Force.