ALL Bank Deposits Now Uninsured

Detective Krum

All bank deposits are at risk if banks fail and FDIC is broke. Here is the report;

FDIC Discloses Deposit Insurance Fund Is Now Negative
Tyler Durden on 09/29/2009 09:54 -0500

In an unprecedented disclosure, the FDIC has highlighted that it expects the DIF reserve ratio to be negative as of September 30. As there are a whopping 48 hours before that deadline, one can safely assume that the DIF is now well into negative territory: as of today depositors have no insurance courtesy of a banking system that has leeched out all the capital of the Federal Deposit Insurance Corporation. Let’s pray there is no run on the bank soon.

Pursuant to these requirements, staff estimates that both the Fund balance and the reserve ratio as of September 30, 2009, will be negative. This reflects, in part, an increase in provisioning for anticipated failures. In contrast, cash and marketable securities available to resolve failed institutions remain positive.

Additionally, the FDIC has now raised its expectation for bank failure costs from $70 billion $100 billion. Feel free to expect this number to continue growing.

Staff has also projected the Fund balance and reserve ratio for each quarter over the next several years using the most recently available information on expected failures and loss rates and statistical analyses of trends in CAMELS downgrades, failure rates and loss rates. Staff projects that, over the period 2009 through 2013, the Fund could incur approximately $100 billion in failure costs. Staff projects that most of these costs will occur in 2009 and 2010. Approximately $25 billion of the $100 billion amount has already been incurred in failure costs so far in 2009. Staff projects that most of these costs will occur in 2009 and 2010.

First Mary Schapiro has failed at her task of “regulating” anything on Wall Street, and now Sheila Bair presides over a newly insolvent institution. Chalk one up to Washington’s success at “containing” the crisis. Zero Hedge wishes Ms. Bair all the luck in the world in returning the DIF to its statutory minimum requirement of 1.15% of all insured deposits (a shortfall of a mere hundred billion or so). Maybe she can convert the FDIC to a REIT and have Merrill Lynch do a concurrent IPO and follow-on offering (while Goldman raises it to a Conviction Buy which incorporates the firm’s expectations for 10% GDP growth in 2010 coupled with projections for $1,000 per barrel of crude)?

FDIC’s full memorandum outlining its failure can be found here.

http://www.zerohedge.com/…

Bank Fees – SunTrust Bank Highest

Detective Krum

It appears SunTrust Bank charges the highest fees according to the Financial Times.  The FT reports in part,

The highest overdraft fees were charged by the largest banks, said Mr Moebs. At banks with assets greater than $50bn – a group including Citigroup, Bank of America, JPMorgan Chase and Wells Fargo – the median overdraft fee is set at $33.

At Bank of America, a customer overdrawn by as little as $6 could trigger a $35 penalty. If the customer does not realize they have a negative balance and continue spending, they could incur that fee as many as 10 times in a single day, for a total of $350. Failing to repay the overdraft within a few days results in an additional $35 penalty.

Bank of America  said that the bank was “committed to ensuring that our fees are transparent and predictable. We have a range of tools and services to give customers more control over their accounts and to prevent these fees”.

Chase has tiered overdraft fees – the first overdraft within a 12-month period is charged at $25, the second to fourth at $32 and the fifth at $35.

Chase declined to comment.

SunTrust Bank charges the highest overdraft fee for a single overdraft at $36, according to the Consumer Federation of America while Citizens Bank levies a $39 fee after three overdraft items and follows with two separate “sustained overdraft fees” for repeat offenders.

SunTrust said it offered waivers and discounts as well as overdraft protection services that made it easy for customers to avoid those fees.

In lieu of all the bank bailouts each of these banks took from the American people, you would think they would waive the overdraft fees.

See more about bank fees here.

SunTrust Bank Robbery

Detective Krum

SunTrust Bank was a victim of a bank robbery on Monday September 28, 2009 in Orlando, Florida. Reports say the suspect entered the bank, passed a note, implied that he had a weapon and fled the scene.

Police say the suspect in Monday’s robbery is similar to the suspect in a SunTrust Bank robbery that happened in Sarasota on Wednesday, September 23, 2009. Police say in both robberies, the suspect entered the bank shortly after the bank opened at 9:00 a.m., passed a note, implied that he had a weapon and fled with a messenger style bag.

Bank Foreclosure News

Detective Krum

The Mortgage Electronic Registration company known as “MERS” is not a party in a foreclosure action.  Many mortgages, especially in Florida, were processed through MERS.  When a property is foreclosed, MERS has apparently tried to collect a percentage of the foreclosure judgment. The courts have had their say in the matter.

The clip from an article was first picked up, by me, at renowned financial wiz Catherine Austin Fitts site located here.  For those in foreclosure now, amendments should be made to any court actions naming MERS. Here is the article clip:

The Supreme Court of Kansas recently referenced a Bankruptcy Court from Massachusetts that said:

“When the role of a servicing agent [MERS] acting on behalf of a mortgagee is thrown into the mix, it is no wonder that it is often difficult for unsophisticated borrowers to be certain of the identity of their lenders and mortgagees.” In re Schwartz, 366 B.R. 265, 266 (Bankr. D. Mass. 2007).

Then cited the Supreme Court of New York (Kings County) that said:

“[T]he practices of the various MERS members, including both [the original lender] and [the mortgage purchaser], in obscuring from the public the actual ownership of a mortgage, thereby creating the opportunity for substantial abuses and prejudice to mortgagors . . . , should not be permitted to insulate [the mortgage purchaser] from the consequences of its actions in accepting a mortgage from [the original lender] that was already the subject of litigation in which [the original lender] erroneously represented that it had authority to act as mortgagee.” Johnson, 2008 WL 4182397, at *4, 873 N.Y.S.2d 234 (2008).

When a court references these slams you know that the House of Cards that is MERS (Mortgage Electronic Registration Systems) is gonna take a hit.

TECHNICAL STUFF: Seems that when a first lienholder was foreclosing it sent notice to the originator of the second lien even though MERS was shown to be mortgagee on the second lien (as nominee of the lender).  Of course, the second lien originator had previously transferred its interest to a new lender, and the new lender did not get notice of the foreclosure and was wiped out by the foreclosure by the first lienholder.  The question was whether MERS was entitled to notice of the foreclosure.  The answer was no. (See another description of the case here.)

The relationship that MERS has to (to holder of a loan) is more akin to that of a straw man than to a party possessing all the rights given a buyer. A mortgagee and a lender have intertwined rights that defy a clear separation of interests, especially when such a purported separation relies on ambiguous contractual language. The law generally understands that a mortgagee is not distinct from a lender: a mortgagee is “[o]ne to whom property is mortgaged: the mortgage creditor, or lender.” Black’s Law Dictionary 1034 (8th ed. 2004). By statute, assignment of the mortgage carries with it the assignment of the debt. K.S.A. 58-2323. Although MERS asserts that, under some situations, the mortgage document purports to give it the same rights as the lender, the document consistently refers only to rights of the lender, including rights to receive notice of litigation, to collect payments, and to enforce the debt obligation. The document consistently limits MERS to acting “solely” as the nominee of the lender.

Landmark Nat’l Bank v. Kesler, 2009 Kan. LEXIS 834 (Aug 28, 2009), here.

The Kansas Court went on:

What stake in the outcome of an independent action for foreclosure could MERS have? It did not lend the money to Kesler or to anyone else involved in this case. Neither Kesler nor anyone else involved in the case was required by statute or contract to pay money to MERS on the mortgage. [citation omitted](”MERS is not an economic ‘beneficiary’ under the Deed of Trust. It is owed and will collect no money from Debtors under the Note, nor will it realize the value of the Property through foreclosure of the Deed of Trust in the event the Note is not paid.”). If MERS is only the mortgagee, without ownership of the mortgage instrument, it does not have an enforceable right.

Landmark Nat’l Bank v. Kesler, 2009 Kan. LEXIS 834 (Aug 28, 2009), here.

Credit Union News and Unclaimed Deposits

Detective Krum

Here is an update from the administration of credit unions regarding the  credit union deposit insurance fund.

“The Helping Families Save Their Homes Act of 2009, signed into law May 20, 2009, includes a provision extending $250,000 share insurance coverage provided by the National Credit Union Share Insurance Fund through December 31, 2013. Previously, this level of coverage was set to expire December 31, 2009. The new law also requires NCUA to use the higher $250,000 standard maximum share insurance amount when making decisions about premiums and administering insurance deposit adjustments.”

The National Credit Union Administration is the independent federal agency that regulates charters and supervises federal credit unions. NCUA, with the backing of the full faith and credit of the U.S. government, also operates and manages the National Credit Union Share Insurance Fund, insuring the deposits of nearly 90 million account holders in all federal credit unions and the majority of state-chartered credit unions.

There are 11 pages of names for people who have left money in a credit union. This money needs to be picked up by an estate or the individual. Here is a partial list of people and if you know of someone who may have dealt with a credit union and may have left money in an account, send us a message.

Credit Union Unclaimed Deposit  partial list:

Part1:

ADAMS II WALTER       THOMASVILLE GA UNIFIED SINGERS
ADDAZIO EST OF ANGELA       FARMINGTON CT WEST HARTFORD
AGUIAR MESSIAS O      FALL RIVER MA ESPIRITO SANTO
AKERS BETTY ROCKY    GAP VA N & W POCA DIVISION
ALEXANDER HERBERT    THOMASVILLE GA UNIFIED SINGERS
ALLEN WILLIAM P        DEMING NM PLAYAS
AMAKER DONALD BLUEFIELD        WV N & W POCA DIVISION
ANDERSON MR / MRS BILLY       ST LUKE BAPTIST FCU
ANDREW JOSEPHINE        THOMASVILLE GA UNIFIED SINGERS
APPLEBY MILES       GROTON CT NEW LONDON SECURITY FCU
ARMISTEAD CHERYL D        WORTH WV N & W POCA DIVISION
AVALLONE VICTOR        BRISTOL CT WEST HARTFORD
AVLARADO MIRTA         HARTFORD CT WEST HARTFORD
BALL ROBERT ARLIS      CEDAR BLUFF VA N & W POCA DIVISION
BAPTIST CHURCH MIDWAY       OCHLOCKNEE GA UNIFIED SINGERS
BARBOUR MARK J        BLACKSBURG VA N & W POCA DIVISION
BARNAS JOHN S         OLD LYME CT WEST HARTFORD
BARR CLYDE S        BLUEFIELD WV N & W POCA DIVISION

Part 2:

BASEBALL LEAGUE PLAYAS YOUTH PLAYAS NM PLAYAS
BEATMAN ANTHONY    KENSINGTON CT WEST HARTFORD
BEATMAN LESLIE     KENSINGTON CT WEST HARTFORD
BEATMAN LILLIAN     KENSINGTON CT WEST HARTFORD
BILANYCH EVA    BROOKLYN NY MIDWOOD FCU
BLACKWELL RUDOLPH      WILLIAMSON WV N & W POCA DIVISION
BLEVINS DERRICK      BECKLEY WV N & W POCA DIVISION
BOBOTSIS GEORGE      GLASTONBURY CT WEST HARTFORD
BOROFSKY MELISSA      HARTFORD CT WEST HARTFORD
BOTA SEFER      NEW YORK BROOKLYN NY MIDWOOD FCU
BRATSIS ROBERT A    PRINCETON WV N & W POCA DIVISION
BRITT DESIREE D     SILVER CITY NM PLAYAS
BROWN JOHN     THOMASVILLE GA UNIFIED SINGERS
BROWN MARY      Kansas City MO K C K POSTAL
BROWN PHILLIP      THOMASVILLE GA UNIFIED SINGERS
BROWN RICHARD     DOUGLAS GA UNIFIED SINGERS

If you know the person on this list you can contact the following:

AMAC
4807 Spicewood Springs Road
Suite 5100
Austin Texas 78759
Phone: (512) 231-7900
FAX: (512) 231-7920

Part 3 in the next post.

Failing Georgia Credit Unions

Detective Krum

Continuing with our reader’s request for credit union information, you’ll find a list of weak Florida credit unions in a prior post. Below are listed Georgia weak credit unions.

If a credit union has 2 stars it is equivalent to an alphabetical score of a (D) and 1 star is equivalent to an (E) rating. Consider, banks with a (D) rating have already failed so a bank does not have to have an (E) rating or (1-star) rating to fail, it can fail with a (D) rating or (2-star) rating.

Look for sound, local banks and credit unions with strong financial records. See our posts for a list of many banks.

Georgia has almost 175 credit unions and the list of weak Georgia credit unions is here:

(2-stars) Brosnan Yard F.C.U.  Macon, Georgia

(0-stars) Clark Community F.C.U.  Athens, Georgia

(2-stars) Coffee County Teachers F.C.U.  Douglas, Georgia

(2-stars) Georgia Coastal  F.C.U.  Brunswick, Georgia

(1-star) South Dekalb Church F.C.U.  Decatur, Georgia

About 15 credit unions in Georgia do not have a rating and the rest of Georgia’s credit unions have a (3, 4 or 5 star) rating.

South Carolina has about 80 credit unions.

(0-stars) Anderson County Educators F.C.U.  Anderson, S.C.

All other South Carolina credit unions have a (3, 4, or 5 star) rating.

Footnote: I have found many education and church related credit unions appear  to be on the verge of failing.  You may want to double check your credit union if you are doing business with an education related credit union or church related credit union.

Bank and Credit Union Failures

Detective Krum

We have been listing banks on the verge of failure and those banks likely to fail soon because their bank rating has fallen. Some notes regarding Orion Bank, based in Naples, Florida with offices in southwest Florida, their bank rating has fallen to an (E-) and it looks like Orion Bank of Florida may fail and soon.  Caution to our readers – you may want to switch your account very soon, to a better rated bank.

Readers have asked if we can list credit unions.  Readers have asked about comparable insurance for credit unions as banks have FDIC. Here is a partial quote regarding credit union insurance.

“The National Credit Union Administration (NCUA) is the independent federal agency that charters and supervises federal credit unions throughout the United States and its territories.

NCUA administers the National Credit Union Share Insurance Fund (NCUSIF). Backed by the full faith and credit of the United States government, the NCUSIF insures the member accounts in all federal credit unions and the substantial majority of state-chartered credit unions.” Link is here  http://www.ncua.gov/

You will want to ask your credit union for a copy of their insurance agreement in the event of a credit union failure. Currently, there are about  190 credit unions in Florida. I will look at Florida Credit Unions first because there are  many retirees.  Remember, based on the star system, (5) stars is best and (1 ) star is worst rating. If  you are doing business with a credit union having one or two stars, you might want to consider switching to another credit union to secure your fortune.  No claim of solvency or insolvency is being made here just passing on information which is public record.

Credit Unions in Florida with a poor or weak rating as of September 2009:

(2-stars)  Bay Gulf Credit Union  Tampa, Florida

(0-stars) Community Trust F.C.U.  Apopka, Florida

(2-stars) Fairwinds Credit Union  Orlando, Florida

(2-stars) FCAMEC  Federal Credit Union Tallahassee, Florida

(0-stars) Florida Episcopal F.C.U.  Orlando, Florida

(2-stars) GTE Federal Credit Union  Tampa, Florida

(1-star)  Keys Federal Credit Union  Key West, Florida

(0-stars) Mt. Sinai C.U.  North Miami, Florida

(2-stars) PBC Credit Union   West Palm Beach, Florida

(1-star)  Sarasota Coastal Credit Union  Sarasota, Florida

(2-stars) Space Coast Credit Union  Melbourne, Florida

(2-stars) SunCoast Schools F.C.U.  Tampa, Florida

(2-stars) Tampa Bay Federal Credit Union  Tampa, Florida

There are about four or five credit unions with no rating and the rest of Florida credit unions have 3, 4 and 5 stars.  If a credit union has 2 stars it is equivalent to an alphabetical score of a (D) and 1 star is equivalent to an (E) rating. Consider, banks with a (D) rating have already failed so a bank does not have to have an (E) rating or (1-star) rating to fail, it can fail with a (D) rating or (2-star) rating.

Look for sound, local banks and credit unions with strong financial records. See our posts for a list of many banks.