Wells Fargo Pays Another $11 Million To Settle Wachovia's Lingering Problems

Tuesday, April 05, 2011 23:12
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Wells Fargo Pays Another $11 Million To Settle Wachovia's Lingering Problems

The ongoing probe into how mortgage-backed securities were sold during the credit boom has cost Wells Fargo $11 million to clean up another liability related to its Wachovia acquisition.

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The SEC has determined that Wachovia charged the Zuni Nation and another investor "excessive markups" by forcing them to pay close to face value on $5 million in mortgage debt that it had previously marked down 47% on its own books.

 

The transactions violated the "shingle theory" by hiding the markups.

 

Wells Fargo acquired Wachovia after that bank's mortgage portfolio forced its collapse. 

 

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