Legal News

Banks Have a Mere $65 Billion in Outstanding Legal Costs
Download PDF
1 Star2 Stars3 Stars4 Stars5 Stars (No Ratings Yet)
Loading...

Although many banks have already paid significant sums for their roles in the 2008 financial crisis, many still face billions more in fees and fines.

Summary: Although many banks have already paid significant sums for their roles in the 2008 financial crisis, many still face billions more in fees and fines.

It looks as though the legal battles are finally coming to an end for big banks. Cases stemming from the 2008 financial crisis have, so far, cost banks an estimated $260 billion, QZ.com reports. Regulators have carefully examined their conduct both before and after the economy took a nosedive. These banks have been accused of a number of wrongs, such as rigging rates, avoiding sanctions, and issuing subprime mortgages.

  
What
Where


Morgan Stanley analysts estimate that the 25 biggest banks in the United States and Europe face an additional $65 billion in penalties over the next couple of years.

Settlements have been reached with some banks for Forex Manipulation.

The main source of trouble for these banks is mortgage malpractice. So far, these banks have paid an incredible $94 billion in fines and provisions, and face another $13 billion in the coming years. British banks have coughed up over $40 billion for touting a misleading form of personal insurance, which was the second-largest basis of fines. Other charges were due to sanctions violations, tax evasion, interest-rate manipulation, and other misdeeds. The Irish Examiner adds that Central Bank has paid around 119 million euros since 2011 on fees. According to Bloomberg, Deutsche Bank AG has paid out over $12 billion in fines and legal settlements.

Get JD Journal in Your Mail

Subscribe to our FREE daily news alerts and get the latest updates on the most happening events in the legal, business, and celebrity world. You also get your daily dose of humor and entertainment!!






Will these banks be able to recover?

View Results

Loading ... Loading ...

The next round of suits against banks is expected in London.

Bank of America and JPMorgan are ahead of other banks when it comes to costs already expended, but the Royal Bank of Scotland faces the biggest bill yet, an estimated $13 billion by 2017. Most of the staggering fine is related to mortgage misdeeds in the United States. The charges actually exceed the bank’s predicted operating profit in 2017. A dividend probably will not be paid out until 2018, ten years after shareholders last received one.

Of course, estimating future legal costs is guesswork at this point. Some of the numbers include “general provisions for issues not yet identified, given the ongoing focus of regulators on a broad spectrum of historic issues,” analysts explained.

Bank of America is actually seeing strong profits numbers.

However, the analysts do think that things are moving in the right direction. For example, executive pay has dropped by nearly one-third since 2006, with emphasis shifting to long-term incentives and non-financial targets. The hiring of compliance and risk management staff has also increased, with numbers more than doubling at JPMorgan and HSBC in the last few years.

Source: QZ.com

Photo credit: washingtonstatespeedingticket.com



 

Interesting Legal Sites You May Like


BCG FEATURED JOB

Locations:

Keyword:



Search Now

Senior Labor and Employment Attorney

USA-CA-Mountain View

Mountain View office of our client seeks senior labor and employment attorney with 4+ years of exper...

Apply Now

Mid-Level Corporate Associate

USA-CA-San Francisco

San Francisco office of our client seeks mid-level corporate associate with 3 years of experience. T...

Apply Now

Junior to Mid-Level Corporate Associate

USA-WA-Seattle

Seattle office of our client seeks junior to mid-level corporate associate with 2 years of experienc...

Apply Now

Litigation Labor and Employment Associate

USA-CA-Sacramento

Sacramento office of our client seeks labor associate with 2-4 years of employment litigation experi...

Apply Now

RELEVANT JOBS

Associate - Insurance Coverage D&O Group

USA-NY-Valhalla

Defense firm seeking junior insurance coverage associate with strong analytical and writing skills f...

Apply now

Hotline & Training Managing Attorney (IMMIGRATION)

USA-NY-New York City

The Hotline & Training Services Managing Attorney will guide, develop, and supervise the Hotline sta...

Apply now

Civil Litigation Attorney

USA-WV-Charleston

Goodwin & Goodwin, LLP, a mid-sized law firm in Charleston, WV,  is seeking applicants for the ...

Apply now

Litigation paralegal

USA-TX-Dallas

We are looking to immediately hire a responsible, highly organized, self-motivated litigation parale...

Apply now

Most Popular

SEARCH IN ARCHIVE

To Top