SEC Extension of Comment Period for ABS Conflict Proposal
On December 13, the SEC extended the comment period for proposed Rule 127(b) that, pursuant to Section 621 of the Dodd-Frank Act, would prohibit material conflicts of interest in securitizations. Comments on the proposed rule must now be submitted by January 13, 2012. SEC Release. Proposed Rule.
GSE Implementation of Uniform Loan Delivery Dataset Delayed
On December 14, the FHFA extended implementation dates for the Uniform Loan Delivery Dataset, a component of the Uniform Mortgage Data Program initiative by Fannie Mae and Freddie Mac. The voluntary implementation date is delayed to April 23, 2012, and required implementation is delayed from March 2012 to July 23, 2012. FHFA Release.
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On December 15, Fitch updated its bank regulatory capital criteria. Fitch Release.
On December 15, Fitch updated its hybrid equity rating criteria for the non-financial corporate and REIT sectors. Fitch Release.
On December 15, DBRS published its master European RMBS rating methodology and jurisdictional addenda. DBRS Release.
On December 14, S&P requested comment on its proposed methodology for rating obligations secured by future U.S. federal cash flows. Comments must be submitted by January 17, 2012. S&P Release.
On December 14, Fitch updated its criteria for rating prerefunded U.S. municipal bonds. Fitch Release.
On December 13, Fitch updated its corporate governance criteria. Fitch Release.
On December 12, Fitch updated its insurance broker rating criteria report. Fitch Release.
On December 12, Fitch updated its criteria for finance and leasing companies. Fitch Release. Fitch Report.
On December 9, Moody's released its approach to rating transactions backed by structured settlements. Moody's Methodology.
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Stichting Pensioenfonds Sues WaMu, Bear Stearns For RMBS Losses
On December 7, 2011, Stichting Pensioenfonds, a Dutch pension firm, filed a complaint against JP Morgan Chase & Co., and related entities and individuals, in the Supreme Court of the State of New York. Stichting seeks to recover losses incurred on 26 RMBS certificates purchased from JP Morgan, Bear Stearns & Co., and Washington Mutual Bank. Stichting alleges that the defendants made false or misleading statements regarding the quality of the mortgages underlying the securities. Stichting is pursuing claims based on Sections 11, 12(a)(2), and 15 of the Securities Act of 1933, as well as common law claims of negligent misrepresentation, fraud, and aiding and abetting fraud. Complaint.
RMBS Claims Against JP Morgan Dismissed for Lack of Standing
On December 13, 2011, Judge Korman of the Eastern District of New York granted in part a motion to dismiss a putative class action accusing JP Morgan affiliates of misrepresentations and omissions in connection with $36.8 billion worth of mortgage-backed securities. Judge Korman ruled that the lead plaintiff lacked Article III standing to assert claims in connection with any certificates other than those in the specific tranches of the specific securitizations in which the lead plaintiff had purchased certificates. As to certain of those offerings, the Court further dismissed plaintiffs' claims as to those certificates for which the lead plaintiff failed to allege that the certificates had been either bought directly from a defendant or purchased in initial public offerings. As to those certificates for which plaintiffs were permitted to proceed, the Court further dismissed without prejudice plaintiffs' claims insofar as they related to alleged misstatements concerning credit enhancements and credit ratings. However, the Court allowed plaintiffs' claims related to alleged misstatements concerning appraisal practices and the underwriting guidelines of certain originators to proceed. As to all issues on which the Court granted defendants' motion other than Article III standing, the Court granted plaintiffs leave to replead. Order.
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