due diligence
U.S. sues banks over questionable home loans during crisisPosted by RJ and Makay on Sep 07, 2011 |
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This past Friday, the Federal Housing Finance Agency (FHFA) filed lawsuits against 17 of the world’s largest financial institutions, claiming that they sold $196 billion of risky home loans to Fannie Mae and Freddie Mac, during a four-year span, without adequately disclosing the risks. The move by the top federal housing regulator is the most sweeping action to date since the mortgage meltdown of 2008 that imperiled the nation’s financial system and led to a deep recession.
A recent Registered Rep article, “The New Due Diligence,” explains how due diligence has significantly evolved since the financial crisis of 2008-2009. Back then, it wasn’t uncommon for some broker-dealers to look at products that large broker-dealers were putting on their platforms and simply adopt the same for their own platform.
