DS News

» VISIT US ONLINE @ DSNEWS.COM 7 A look at facts you didn't know you couldn't live without. Compiled by the DS News Staff TAKE A LOOK INSIDE THE NUMBERS D ATA B I T S As of February 2016, Fannie Mae and Freddie Mac have completed a combined total of 3,674.849 foreclosure prevention actions since the start of the conservatorships in September 2008, according to the Federal Housing Finance Agency. In April 2016, there were 70,457 bankruptcy filings nationwide, which was a decline of 7.492 from the previous April and a decline of more than 50 percent from April 2010's total of 146,374, according to AACER Bankruptcy Data reported by Epiq Systems. APPELLATE COURT STRIKES BOA'S PENALTY IN 'HUSTLE' CASE INSIDE THE JOURNAL // MOVERS & SHAKERS // ON THE WEB // THE APP SPECTRUM Source: RentRange (as of Q1 2016) Source: RentRange (as of Q1 2016) U.S. METROS WITH THE LARGEST YEAR-OVER- YEAR SINGLE-FAMILY RENT INCREASES 1 Cape Coral-Fort Myers, Florida 29.2% 2 Naples-Marco Island, Florida 26.0% 3 Knoxville, Tennessee 19.9% 4 North Port-Bradenton-Sarasota, Florida 18.3% 5 Shreveport-Bossier City, Louisiana 17.4% 6 Syracuse, New York 17.4% 7 Milwaukee-Waukesha-West Allis, Wisconsin 17.2% 8 Daytona Beach, Florida 17.2% 9 New Orleans-Metairie-Kenner, Louisiana 17.1% 10 Charleston, South Carolina 16.4% Metro Percentage Ranking U.S. METROS WITH THE HIGHEST AVERAGE GROSS YIELDS ON SFR PROPERTIES 1 Syracuse, New York 11.27% 2 New Orleans-Metairie-Kenner, Louisiana 10.48% 3 Milwaukee-Waukesha-West Allis, Wisconsin 10.45% 4 Gainesville, Florida 9.74% 5 Little Rock, Arkansas 9.62% 6 Buffalo-Niagara Falls, New York 9.55% 7 Shreveport-Bossier City, Louisiana 9.55% 8 Santa Barbara, California 9.36% 9 North Port-Bradenton-Sarasota, Florida 8.57% 10 Daytona Beach, Florida 8.53% Ranking Metro Percentage PAGE 36 SVP and Chief Economist. Fannie Mae ASK THE ECONOMIST WITH Douglas G. Duncan e U.S. Second Circuit Court of Appeals overturned a $1.27 billion penalty imposed on Bank of America over the alleged misrepre- sentation of mortgage-backed securities sold by Countrywide Financial Corp. to the GSEs through a program known as the High Speed Swim Lane (HSSL, commonly known as "Hustle"). e appellate court overturned the verdict because the proof was insufficient under federal fraud statutes to hold the bank liable in con- nection with Countrywide's Hustle program. e court's ruling stated that the govern- ment "needed to show false or misleading statements made with fraudulent intent," but instead, "Critically, the government presented no proof at trial that any quality guarantee was made with fraudulent intent at the time of contract execution. Nor did it offer evidence of any other representations, suggestions, or promises—separate from and post-dating execution of the initial contracts—that were made with fraudulent intent to induce the GSEs to purchase loans." Bank of America spokesman Lawrence Grayson said of the reversal of the penalty, "We are pleased with the appellate court's decision." A spokesman for Manhattan U.S. Attorney Preet Bharara, who brought the case to trial, said he had no immediate comment when contacted by DS News. e U.S. Department of Justice sued Bank of America in August 2013 over Hustle, alleg- ing that the program emphasized speed over quality of the loans sold, and staff members were rewarded according to sales volume. e government's lawsuit against Bank of America was a whistleblower suit originated from former Countrywide executive Edward O'Donnell, who reportedly collected $57 mil- lion for filing the whistleblower suit. In October 2013, a jury found Country- wide liable for selling toxic MBS to Fannie Mae and Freddie Mac under the Hustle program. Bank of America was ordered to pay a $1.27 billion civil penalty by Judge Jed Rakoff of the U.S. District Court of the Southern District of New York in July 2014 as a result of the bank's alleged role in selling toxic mortgage-backed securities to the GSEs. Since Rakoff issued the penalty, Bank of America has fought to have the verdict and the penalty dismissed, claiming not only that the Hustle program ended prior the bank's 2008 acquisition of Countrywide, but that the government's accusations in the case amount only to breach of contract and not fraud. In February 2015, Rakoff denied the bank's request to overturn the verdict and the request for a new trial. In April 2015, Bank of America asked court to either reverse the judgment in the Hustle case or vacate the judgment and remand the case, claiming that Rakoff made partial public statements while the case was still pending and also that "the trial itself was riddled with errors at both the liability and penalty phases." A $1 million fine against former Country- wide executive Rebecca Mairone—so far the only individual penalized by the government for an alleged role in the financial crisis—was also overturned along with the $1.27 billion penalty against the bank.

• Cover