Bankruptcy Information

Former Florida mortgage lender Lee Farkas, the government’s biggest criminal conviction of the financial crisis, wants a retrial.

Lawyers for Farkas, who was sentenced last June for orchestrating a multibillion-dollar fraud, say a federal court’s “rush to judgment” violated his rights to a fair trial.  His lawyers also say a federal judge erred by instructing a jury its sole interest was to seek the truth without allowing further definition of “reasonable doubt.”  Read his brief here.

Farkas, whom federal prosecutors described as a “consummate fraudster,” was sentenced to 30 years in prison after a jury found him guilty of misappropriating about $3 billion and trying to fraudulently obtain more than $550 million from the government’s Troubled Asset Relief Program in a failed effort to prop up Colonial Bank. The seven-year fraud

Read full post…

Tags: Lee Farkas, Retrial

For the last few years, I have witnessed a steady stream of homeowners flowing through my office who are dumbfounded by their inability to get a mortgage modification.  And for years, I have been telling them all the same thing:

YOUR SERVICER DOESN’T WANT TO MODIFY YOUR LOAN!

The truth of the matter is that, of all the options available to a mortgage servicer to deal with a distressed homeowner, mortgage modification is the least desirable for the servicer of your loan.

This phenomenon is discussed at length in a recent Washington Law Review article by attorney Diane E. Thompson entitled Foreclosing Modifications: How Servicer Incentives Discourage Loan Modifications, 86 WashLRev 755 (© 2011).  Ms. Thompson, who is Of Counsel at the National Consumer Law Center, adeptly dissects the servicer’s incentive to foreclose rather than modify a mortgage.  She concludes:

The financial compensation and constraints imposed on and chosen by servicers generally lead servicers to prefer refinancing, foreclosures, and short-term repayment plans to modifications. Service

Read full post…

The long slow death march at Sears Holdings Corporation (NASDAQ: SHLD) is turning into a case study of what not do.  Putting a hedge fund manager in charge of a huge retailer, and then letting the company be run by another person for quite some time without deep retail experience.  Imagine if Wal-Mart Stores Inc. (NYSE: WMT) or Target Corporation began a long secular decline where the only way they could attract investors is by unloading assets here and there, shrinking their geographic footprints time after time, cutting workers endlessly, and by trying to just repurchase enough stock that the free float dwindles.  And imagine no real payments to shareholders in the form of dividends.

Fortunately for investors in retail stocks, Target and Wal-Mart are not Sears. We ju

Read full post…

Tags: Shld, Shld Wmt

Jan 4 The insolvency administrator of Manroland said on Wednesday it was homing in on an investor for the German printing machine maker and saw a deal feasible by the end of the month.

“We now have parties seriously interested in all three production sites in Augsburg, Offenbach and Plauen, with whom we are involved in ongoing negotiations,” Werner Schneider of law firm Schneider, Geiwitz & Partner said in a statement, without naming any possible buyers.

The firm said no orders had been cancelled and production would continue beyond Jan. 31 based on the current backlog.

Manroland filed for insolvency in late November after its owners Allianz Capital Partners and MAN SE failed to find an investor before the world’s No.3 printing machine maker ran out of money.

Manroland, with 6,600 employees and annual sales of close to 1 billion euros , competes with Heidelberger Druckmaschinen and Koenig & Bauer, as well as Japan’s Komori, Ryobi and Mitsubishi .

Tags: Deal Feasible, Feasible

For Eva Longoria, art imitates life. The “Desperate Housewives” actress spent the past year embroiled in legal drama with investors in her Las Vegas restaurant Beso and will now produce a legal drama for the CW television network.

The one-hour show, called “Vega v. Vega,” will focus on “a brilliant, young, successful lawyer who suddenly finds herself forced to go into a practice with her mother, a pioneering female attorney with whom she has a love/hate relationship,” according to the Hollywood Reporter.

Bankruptcy Beat readers are familiar with the legal drama that’s been the backdrop to Longoria’s daily life over the past year. In January, the Las Vegas restaurant Beso sought Chapter 11 bankruptcy protection amid a dispute between its investors, including Longoria, who held nearly a third of the company. One of those in

Read full post…

Tags: Drama, Legal Drama