tailieunhanh - DA VANCE: ABACUS BANK AND 19 INDIVIDUALS CHARGED IN LARGE-SCALE MORTGAGE FRAUD CONSPIRACY

Organizational form has important implications for economic behavior, performance, and business activities of financial firms (see, ., O’Hara 1981, Rasmusen 1988, and Fama and Jensen 1983). One unusual characteristic among financial intermediaries is the fact that mutual and stock companies coexist (Amess 2002), while outside the financial sector, stock firms dominate and mutual companies are relatively rare (Remmers 2003). The main objective of a commercial bank is shareholder value (profit) maximization, whereas a cooperative or a savings bank aims at maximizing the value for a larger set of stakeholders; that is to provide the best products and services to its clients, who in the case of the cooperative are also its members. Because of the different ultimate goals, banks’ efficiency should not be judged exclusively through financial figures but instead it can be looked at from different perspectives. First, efficiency can be viewed as organizational efficiency involving organizational goals, resources, and business performance. Second, it may be viewed as pure financial efficiency pertaining to the . | CYRUS R. VANCE JR. DISTRICT Attorney DISTRICT ATTORNEY - NEW YORK COUNTY FOR IMMEDIATE RELEASE CONTACT Erin Duggan May 31 2012 212-335-9400 DA VANCE ABACUS BANK AND 19 INDIVIDUALS CHARGED IN LARGE-SCALE MORTGAGE FRAUD CONSPIRACY Employees and Managers Charged With Routinely Submitting False Documents to Fannie Mae Prosecution Marks the First Time a Bank Has Been Indicted in Manhattan Since 1991 Manhattan District Attorney Cyrus R. Vance Jr. today announced the indictment of ABACUS FEDERAL SAVINGS BANK ABACUS or the Bank and eleven of its former employees in a false document mortgage fraud scheme resulting in the sale of hundreds of millions of dollars worth of fraudulent loans to the Federal National Mortgage Association commonly known as Fannie Mae. The District Attorney also announced that an additional eight former employees have already waived indictment and admitted their guilt in connection with this conspiracy. The 184-count indictment charges eleven individuals and ABACUS itself with residential mortgage fraud securities fraud grand larceny conspiracy and falsifying business records among other related The defendants include former senior managers as well as former employees who worked in various capacities for the Bank s lending business. Each defendant faces charges related to his or her involvement in the criminal conspiracy which the indictment charges occurred between May 2005 and February 2010. The lessons of the financial crisis are still being learned said District Attorney Vance. The public must have confidence that when a bank issues a loan that it later re-sells to Fannie Mae and by extension the nation s investors it will engage in honest and ethical practices and follow the rules set by regulators said District Attorney Vance. Loan schemes based on fraud inevitably will unravel as this one did. Today s indictment re-affirms our commitment to transparency and straight dealing in the financial markets. We cannot settle for less. 1 The .