Let the Buyer Beware!

This looks like a double-dose of look-before-you-leap.

One of the country’s largest financial institutions, AIG, is suing another large financial institution, Bank of America (BofA), because of some bad purchases – on both sides. BofA recently acquired two companies, which AIG says engaged in massive fraud with all those subprime mortgages that led to the housing crisis. (Both companies were under investigation by the government for the same thing, but the criminal charges were eventually dropped.)

Makes you think that maybe BofA should’ve been a little more careful about doing its homework before buying those companies and becoming legally responsible for their subprime mortgage dalliances. Kind of like doing your homework before you buy stock in a company - you really want to know what you’re buying into when you hand over your money.

Now for another case of look-before-you-leap: BofA is saying that AIG had all the resources it needed to figure out whether it was a good idea to buy those mortgage securities in the first place. It’s not like the big bad banks were ripping off a little old grandma here…

They may all be right - who knows? But one thing seems pretty clear: CAVEAT EMPTOR!

How carefully do you do YOUR homework before shelling out a ton of cash?

BofA Ordered to Pay $930,000 to Fired Whistleblower

By Hugh Son - Sep 14, 2011 12:58 PM PT

Bank of America Corp. (BAC) must pay $930,000 to an employee who uncovered fraud at Countrywide Financial Corp. and was fired in violation of whistleblower protections, the U.S. Department of Labor said.

The employee was terminated soon after the Charlotte, North Carolina-based bank took over Countrywide in 2008, the agency said today in a statement. The worker, who must also be reinstated, led internal investigations that found “pervasive wire, mail and bank fraud involving Countrywide employees,” according to the release.

“It’s clear from our investigation that Bank of America used illegal retaliatory tactics against this employee,” said David Michaels, assistant secretary of the Labor Department’s Occupational Safety and Health Administration, in the statement. “This employee showed great courage reporting potential fraud and standing up for the rights of other employees.”

Bank of America Chief Executive Officer Brian T. Moynihan, 51, has been settling demands from buyers and insurers of soured mortgages created by Countrywide, which had been acquired by his predecessor, Kenneth D. Lewis. Countrywide was the biggest creator of subprime loans, made to homeowners with the weakest credit, and regulators and lawmakers have blamed lax underwriting for fueling defaults.

Bank of America, the biggest U.S. lender by assets, had investigated the claims and is “disappointed” with the ruling, said Dan Frahm, a company spokesman.

“The bank’s actions in dismissing this associate were solely based on issues with her management style and in no way related to the complaints and allegations she made,” Frahm said in an e-mail. “Bank of America encourages associates to raise issues they see. We take such escalations seriously and investigate them thoroughly.”

The Los Angeles-area worker claimed that people who tried to report fraud to Countrywide’s employee-relations department suffered persistent retaliation, according to the agency. The $930,000 includes back wages, interest, compensatory damages and attorney fees.

The worker and Bank of America have 30 days to appeal the monetary damages, the agency said.

To contact the reporter on this story: Hugh Son in New York at hson1@bloomberg.net.

Source: http://www.bloomberg.com/news/2011-09-14/bofa-ordered-to-pay-930-000-to-whistleblower.html

Alternative Press / Walmart - Mini-mag cover shoot

Things are changing rapidly. And it’s still not clear for better or for worse. With the economy dip last year lots of dinosaurs got closed down and some new forward thinking businesses opened up. What also might be a coincidence last year and with everything going down the hill, the introduction of video and traditional media going digital made us all aware how comfortable we are. This was one of the reasons for such harsh time for many photographers out there. But it’s time for next step, a rebirth of media, a fusion of technologies, partnerships, joint efforts. It’s already here and happening. While many pubs are completely going online, some are finding ways to reinvent traditional media and move forward. I recently shot a cover for a special edition of Alternative Press music magazine. They partnered with Walmart for exclusive seasonal release…

You can only find this in Walmart! It’s a mini-magazine (5.5 x 7”) with 2 audio cds, a locker poster and a band name bracelet! And it’s only $5. It’s a great example of what can be done with traditional media without going completely digital and still be very affordable! Being a small format, with some media, lots of photos and tight articles, this magazine is catered to a specific audience and will be a great success without a doubt. The band featured called Cartel, who just went to Wind Up Records, a perfect new label to be at. Check out their new release Cycles.

I know sooner than later we’ll see a lot more content being on portable media (think iPad), completely interactive and customizable. It is really amazing what Sports Illustrated got going here:

What I wish to see, is more collaborations. Unique content in unexpected format with a niche is really where it’s at and with a good distribution partner is what will drive a good quality content to people who care to spend time and money on it. And what about a fusion of magazines? Something that is catered to one person but delivered digitally. Articles pulled from various sources in one multimedia presentation. Something to think about …