FDIC quietly settles financial crisis cases -report
WASHINGTON, March 11
WASHINGTON, March 11 (Reuters) - The Federal Deposit Insurance Corp collected $787 million in settlements to resolve civil claims related to bank failures from 2007 through 2012, according to statistics compiled by the Los Angeles Times.
Many of those settlements are not widely known, because the agency usually does not issue press releases and announce the settlements, the newspaper said.
Deutsche Bank, for example, paid $54 million to settle a case in 2010 over unsound loans it sold to California-based IndyMac Bank, it said.
The paper said it obtained 1,600 pages of settlement records through a Freedom of Information Act request.
FDIC spokesman Andrew Gray said the agency many sue professionals involved in the failure of an institution it insures, and may settle those claims if the result is a "satisfactory recovery" that avoids costly litigation.
"When a settlement agreement is reached, terms and conditions are publicly available, as federal law prohibits the FDIC from entering into confidential settlements with professionals of failed institutions," he said in a statement.
Sinced 2007, 471 U.S. banks have failed since, the paper said, saddling the FDIC deposit insurance fund with $92.5 billion in losses.
Some lawmakers and others have criticized federal regulators for what they perceive as weak settlements that address conduct that contributed to the 2007-2009 financial crisis.