International Law

Thursday Fraud News

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Alan White writing at Consumer Law and Policy argues that GSE were not responsible for the subprime crisis:

"The fact is that subprime lending caused the crisis, and subprime loans were, by definition, loans that Fannie and Freddie (the GSEs) would NOT purchase. Let's say that again.

A subprime loan was a loan that was not eligible for purchase by the GSEs, also known as a "nonconforming" loan.

A mortgage was ineligible for GSE purchase for one of two reasons: either the amount exceeded the GSE ceiling of about $350,000, or the underwriting was too lax to meet GSE standards.

Subprime loans were sold to investors through so-called private label securitizations, which means a securitization that was NOT sponsored by Fannie or Freddie."

From Smart Money, we learn about the dangers of stored value cards:

"Stored value cards (SVCs) offer new opportunities for illicit financial transactions, money laundering and bulk cash smuggling by organised criminals, according to a paper released today by the Australian Institute of Criminology (AIC).

The report, called "Money laundering risks of prepaid stored value cards" highlights some of the ways that increasingly popular stored value cards can be used to disguise criminal transactions.

"There are various types of SVCs, from limited-value cards, which can be used at limited vendors, to cards with a large amount of value attached to them, redeemable at numerous merchants and service providers," the general manager of research at AIC Judy Putt says."

Full post as published by Misleading Advertising Law on October 09, 2008 (boomark / email).