December 11, 2013 – Statement 102: “Given these facts, further regulation of the financial system through the Dodd-Frank Act was a disastrously wrong response. The vast new regulatory restrictions in the act have created uncertainty and sapped the appetite for risk-taking that had once made the U.S. financial system the largest and most successful in the world.” Peter J. Wallison, American Enterprise Institute
December 11, 2013 – Statement 101: “And the Fed’s trillions in interest rate risk is supported by only $55 billion of capital; their capital is just 1.4% of assets. They have debt (leverage) that is about 70 times their capital!” Mike Perry
December 10, 2013 – Statement 100: “…you can buy your own stock (with borrowed funds) at a 14% return with a negative or zero or 1% to 2% cost of capital for at least a 12% spread.” Larry Haverty, Gabelli Multimedia Trust
December 10, 2013 – Statement 99: “One of the problems we have in the United States is that prosecutors like to make a name for themselves and they all try to distinguish themselves in one way or another. One way to distinguish yourself is to get the highest penalty ever against a bank…I don’t think it bears much resemblance to anything else. It is not rational.” Commissioner Daniel M. Gallagher, The Securities and Exchange Commission
December 4, 2013 – Statement 98: “So what is it with the Norwegians? Well, they have a kind of superiority complex.” Nobel Laureate Robert Shiller (explaining his psychological theory for what appears to be a current Norwegian housing bubble)
December 4, 2013 – Statement 97: “If you simply announce that things are irrational, then that alone doesn’t get you very far. You have to replace rational agents with some concrete notion of what it means to be irrational. You need to test that notion in a formal, mathematical model.” Nobel Laureate Lars Peter Hansen
December 3, 2013 – Statement 96: “Again, the evidence suggests that we have become an economy whose normal state is one of mild depression, whose brief episodes of prosperity occur only thanks to bubbles and unsustainable borrowing.” Paul Krugman
December 2, 2013 – Statement 95: “Now we’re seeing another upswing in risky behavior. It began surprisingly soon after the crisis, spurred on by central bank policies that depressed the return on safe investments.” Howard Marks
December 2, 2013 – Statement 94: “The recognition of the insuperable limits to his knowledge ought indeed to teach the student of society a lesson of humility which should guard him against becoming an accomplice in men’s fatal striving to control society—a striving which makes him not only a tyrant over his fellows, but which may well make him the destroyer of a civilization…” Nobel Laureate Friedrich A. Hayek
December 2, 2013 – Statement 93: “Venezuelans need a moral authority that defends their rights…they need a champion for a rule of law that will limit the power of the state over their person. Mother Church ought to be that voice. In siding with Mr. Maduro, however inadvertently, she harms her cause in the region.” Mary Anastasia O’Grady
November 26, 2013 – Statement 92: “These agencies (like the CFPB, FDA, FDIC, NSA, and SEC) have assumed frightening new powers over the everyday lives of American citizens, giving government entities free rein over you and me in ways unprecedented in our country’s history.” Sen. Rand Paul
November 25, 2013 – Statement 91: “Allow me to highlight—and then question—some of the prevailing wisdom at the basis of current Fed policy”, Kevin Warsh
November 25, 2013 – Statement 90: “Too much money is chasing too few assets, pure and simple. Artificially low rates deliver artificially high asset prices, accentuating financial fragility.” Tad Rivelle, TCW
November 18, 2013 – Statement 87: “One can hope that in a future financial crisis and there will surely be one…economists, investors, and regulators will better understand how fat-tail markets work. Doing so will require better models, ones that more accurately reflect predictable aspects of human nature…” Alan Greenspan
November 14, 2013 – Statement 86: “The banking system in the United States has been highly crisis-prone, suffering no fewer than 14 major crises in the past 180 years…A country gets the banking system it deserves..”, Charles W. Colomiris and Stephen H. Haber
November 13, 2013 – Statement 85: Does Amazon Have a Special Exemption From the SEC in Complying with Securities Disclosure Laws?
November 12, 2013 – Statement 84: “..ask a U.S. citizen if some semi-governmental agency should control the prices of cars, morning newspapers, and wine…he would jump in anger, as it appears to violate every principle the country stands for….this is not France.” Nassim Nicholas Taleb
November 12, 2013 – Statement 83: “My worst fears are confirmed. This is what I was afraid of, that the euro would be preserved and it would pervert the venture and destroy the European Union.” George Soros
November 11, 2013 – Statement 82: “It’s a common observation in the context of emerging-market financial crises that they’re often preceded by large capital inflows from abroad and that the problem is that the local banking system can’t handle the massive inflow of capital. So by analogy, sort of a similar story may have happened in the United States.” Ben Bernanke
November 11, 2013 – Statement 81: “The global economy is just as dysfunctional now as it was before the financial crisis. Imbalances that helped fuel the crisis–including the U.S.’s easy monetary policy…..still exist. In fact, they’ve gotten worse.” Rana Foroohar, Time Magazine
November 7, 2013 – Statement 79: Should housing and other asset bubbles and busts (and related banking crises) that occurred throughout the developed world, raise doubts as to whether nonconforming mortgages and securitization caused the U.S. housing bubble, as many claim?
November 7, 2013 – Statement 78: “We’ve been bouncing from investment bubble to deficit spending to offset the income that is being drained out of the economy by trade deficits” Jared Bernstein and Dean Baker
November 6, 2013 – Statement 77: Pre-Crisis, World Bank Data Shows That Iceland Grew Its Money Supply 5.4 Times Faster Than Its GDP Growth! Spain 4.9 Times! The U.K 4.4 Times! The U.S. 3.3 Times! What Were Central Bankers Thinking?
November 5, 2013 – Statement 76: “Booms and Busts Around the World Happen Whenever Central Banks Tighten or Loosen Monetary Policy.” John Mauldin
November 5, 2013 – Statement 75: “It all fell apart, in the sense that not a single major forecaster of note or institution caught it (predicted the financial crisis)….I was actually flabbergasted, it (studies about market behavior) upended my view of how the world works.” Alan Greenspan
November 4, 2013 – Statement 74: Foreign Trade and Investment Imbalances Were a Major Cause of the U.S. and Global Financial Crisis. They Remain a Huge Unaddressed Risk, Because It was Easier Politically to Just Blame the Bankers.
November 4, 2013 – Statement 73: “The first and most important lesson that history teaches about what monetary policy can do….and it is a lesson of the most profound importance…is that monetary policy can prevent money itself from being a major source of economic disturbance.” Milton Friedman
October 29, 2013 – Statement 72: “The evidence against Fan and Fred is voluminous, but the feds want to whitewash Washington’s role in the panic.”
October 28, 2013 – Statement 71: The Fed’s Low-Rate Policies Prompt Investors to Make Dicier Tech Bets; Just Like They Did in The Dot-Com and Housing Bubbles/Busts
October 22, 2013 – Statement 70: Does JP Morgan Have a Special Exemption from the SEC in Complying with Securities Disclosure Laws Too?
October 21, 2013 – Statement 69: Does Goldman Sachs Have a Special Exemption from the SEC In Complying with the Securities Disclosure Laws?
October 21, 2013 – Statement 68: FDIC Chair Gruenberg Stunningly Admits That Prior to the Financial Crisis They Had No Plans To Address a Big Bank Failure!
October 21, 2013 – Statement 67: “In a post Dodd-Frank world, banks are public utilities and no CEO can afford to resist government’s demands.”
October 18, 2013 – Statement 66: “I’m glad I’m able to be the person who can afford to stand up to them. I don’t want anything from the SEC; except them to act like American citizens and treat other American citizens the way they deserve to be treated.” Mark Cuban
October 15, 2013 – Statement 65: India’s New Central Bank Head Warns the Fed to Pay More Attention to the Global Consequences of Their Actions
October 4, 2013 – Statement 64: “(Federal) Student loans are the new subprime; were talking about hundreds of billions of (government) losses…”, Jim Rickards
October 2, 2013 – Statement 63: Federal Judge Rules HUD/FHA Violated Reverse Mortgage Statute by Improperly Directing Lenders to Foreclose on Elderly Widows!!!
October 1, 2013 – Statement 61: “Monetary policy (set by central bankers like the Fed) insidiously plays with our time preferences and our very ability to engage in economic calculation. The greater the distortion, the greater the destruction needed to correct it.” Mark Spitznagel
September 27, 2013 – Statement 60: “They (central bankers) believe that flooding the world with money will somehow solve the very problems that such interventionism created in the first place.” Ron Paul, 2013
September 27, 2013 – Statement 59: “…the Fed in good measure is the source of risk”, Jim Grant, Founder and Editor Grant’s Interest Rate Observer
September 26, 2013 – Statement 58: “There is an Interaction Between The Monetary Excesses (by the Fed) and Risk-Taking Excesses; Rapidly Rising Housing Prices and Resulting Low Delinquency Rates Threw Underwriting Programs Off Track…”, John B. Taylor
September 25, 2013 – Statement 57: “So if we want them (banks) to be a free capitalist company, they have to be able to fail. If we don’t, we might as well treat them as a utility, because that’s what they are.” Ben Bernanke
September 24, 2013 – Statement 56: “…We believe that the government deserves quite a lot of the blame for getting our financial system and our nation into trouble in the first place.” FCIC Minority Report
September 24, 2013 – Statement 55: “Could the breakdown that so devastated global financial markets have been prevented? I very much doubt it.” Alan Greenspan, February 2010
September 24, 2013 – Statement 54: “With nominal interest rates around 6% and inflation around 6% (in 2004), the real interest rate was near zero, so household borrowing took off” Vernon L. Smith and Steven Gjerstd
September 20, 2013 – Statement 53: “Your No. 1 Client is the Government”
September 19, 2013 – Statement 51: The Simple Explanations for the Global Financial Crisis and Western Slowdown are Wrong
September 18, 2013 – Statement 50: Five Years Later: Don’t Mention the Feds
September 18, 2013 – Statement 49: Unbelievably, the Government’s National Statistical Rating Agency Problem Remains Unsolved!!!
September 17, 2013 – Statement 48: No Down Payment Required (for home mortgages) in Latest Government QRM Proposal!!!
September 10, 2013 – Statement 47: One Thousand One Hundred and Forty Seven Pages: My Entire Sworn Testimony Before the SEC Staff
September 4, 2013 – Statement 46: The Porridge was Too Hot. Now it’s Too Cold. Only Wise Government Knows When It’s Just Right!!!
April 23, 2013 – Statement 45: MBIA Dismisses Lawsuit Against M. Perry and Others
March 13, 2013 – Statement 44: The Securities and Exchange Commission v. The State of Illinois
February 26, 2013 – Statement 42: Is FHA “A home wrecker”?
February 26, 2013 – Statement 41: HUD/FHA is Not More Capable or Noble Than Their Private Sector Counterparts
February 7, 2013 – Statement 40: “Never Explained is Why Some Were Bailed Out and Some Were Not.”
February 4, 2013 – Statement 39: Resolution of All Government Civil Litigation Re. M. Perry: Summarized
January 29, 2013 – Statement 37: Discussion of IndyMac Bank’s 2007 Safety and Soundness Regulatory Examination
January 17, 2013 – Statement 36: “Many People Like Cheap Moralizing…In the West, Intellectuals Like to Blame the Markets”
January 9, 2013 – Statement 35: FDIC Settlement Documents and M. Perry’s Comments Re. Settlement
January 3, 2013 – Statement 34: IndyMac’s (Credit Quality) Performance as a Loan Originator
January 2, 2013 – Statement 33: “Informal Mortgage Industry Talk By Michael Perry”
January 2, 2013 – Statement 32: “IndyMac Bank OMG Not TBTF”
September 27, 2012 – Statement 31: SEC Settlement Documents and M. Perry’s Attorney’s Comments Re. Settlement
September 24, 2012 – Statement 30: U.S. Judge Manuel L. Real’s Signed “Findings of Uncontroverted Facts and Conclusions of Law: Related to Order Granting Partial Summary Judgment in Favor of Perry on SEC’s Risk-Weighting and Section 17(a)(2) Claims”
September 10, 2012 – Statement 28: Transcript of 2nd Partial Summary Judgment Motion Hearing Before Judge Real
August 30, 2012 – Statement 27: The Truth is Emerging Despite the SEC’s Attempts to Conceal It.
August 30, 2012 – Statement 26: I think the SEC is engaging in denialism in their statements to the Court.
August 29, 2012 – Statement 25: How about this recent SEC Statement to the Court; is it misleading? I think so.
August 28, 2012 – Statement 24: Are these recent SEC Statements to the Court inaccurate or misleading? I think so.
August 28, 2012 – Statement 23: Status update on SEC vs. Michael W. Perry
August 24, 2012 – Statement 22: Excerpt from Michael W. Perry’s Sworn SEC Testimony
August 23, 2012 – Statement 21: Supplemental Brief in Support of M. Perry’s 2nd Motion for Partial Summary Judgment in SEC Matter
July 2, 2012 – Statement 20: Reply in Support of M. Perry’s Motion for Partial Summary Judgment: SEC’s Risk Weighting and 17(a)(2) Claims
June 13, 2012 – Statement 19: M. Perry’s Motion for Partial Summary Judgment: SEC’s Risk-Weighting and Section 17 (a)(2) Claims
May 31, 2012 – Statement 18: U.S. Judge Manuel L. Real’s Signed “Order Granting Partial Summary Judgment in Favor of Perry and Keys”
May 31, 2012 – Statement 17: U.S. Judge Manuel L. Real’s Signed “Findings of Uncontroverted Facts and Conclusions of Law”
May 25, 2012 – Statement 16: M. Perry’s Motion in Limine to Exclude Testimony of Professor Anthony Saunders
May 25, 2012 – Statement 15: M. Perry’s Motion in Limine to Exclude Analyst Testimony
May 21, 2012 – Statement 14: Transcript of Partial Summary Judgment Motion Hearing Before Judge Real
May 18, 2012 – Statement 13: M. Perry’s Memorandum of Contentions of Fact and Law
May 7, 2012 – Statement 12: Reply Memorandum in Support of M. Perry’s Motion for Partial Summary Judgment
April 23, 2012 – Statement 11: Former FASB Director MacDonald Opines on $18 million Intercompany Payable/Receivable at March 31, 2008
April 23, 2012 – Statement 10: FTI’s Beloreshki Opines on 2008 DSPP Stock Issuance/Impact on Book Value
April 6, 2012 – Statement 9: Former OTS Regional Director Vigna Opines on Disclosure of Various Regulatory Matters
April 6, 2012 – Statement 8: Former SEC Chief Economist Lehn Opines on Materiality of SEC Allegations and Defendants’ Intent
April 6, 2012 – Statement 7: Former SEC Commissioner Fleischman Opines on Indymac’s Disclosure Controls
April 6, 2012 – Statement 6: Declaration of M. Perry In Support Of His Motion For Partial Summary Judgment
April 6, 2012 – Statement 5: M. Perry’s Motion for Partial Summary Judgment
November 30, 2011 – Statement 4: M. Perry’s Responses to SEC’s First Set of Interrogatories
November 21, 2011 – Statement 3: SEC’s Responses to M. Perry’s First Set of Interrogatories
September 29, 2011 – Statement 2: M. Perry’s Motion to Dismiss FDIC Complaint
September 1,2011 – Statement 1: Initial Statement
“To sin by silence when they should protest makes cowards of men” -Abraham Lincoln
My name is Michael Perry. I am the former Chairman and Chief Executive Officer of Indymac. I have kept silent for three years in the hope that I would be left alone and allowed to rebuild my professional life, but unfortunately that has not been the case. I have been forced to defend myself against unwarranted and false, public allegations.
On July 11, 2008, Indymac Bank was seized by the Federal Deposit Insurance Corporation (FDIC) after a U.S. Senator’s inappropriate public statements during the financial crisis caused a “run on the bank” that rapidly depleted the bank’s ample liquidity. As a result of this bank run and the fact that Indymac was deemed by banking regulators to be “Not Too Big To Fail”, it was not around just a few months later, at the height of the financial crisis, to receive any of the significant and unprecedented assistance the government provided to every “Too Big To Fail” financial institution and hundreds of smaller financial firms. Without this assistance, many, if not most would have suffered the same fate as Indymac, including some of the largest and oldest firms.
Since that time, I and others have been the subject of various government investigations and named as defendants in numerous civil lawsuits, including ones filed by the Securities and Exchange Commission (SEC) on February 11, 2011 (31 months after Indymac was seized), and the FDIC on July 6, 2011 (3 years after Indymac was seized).
The plaintiffs in these civil lawsuits apparently don’t care about the facts or the truth; these suits are filled with distortions and inaccuracies. They are primarily being pursued to gain access to potential settlement proceeds from directors and officers liability insurance, or in the case of the SEC to show politicians, the press, and the public that they are now tough enforcers of the securities laws. The FDIC, for its part, is seeking a significant share of D&O insurance proceeds, but it is also inappropriately seeking to blame former banking executives like me for the FDIC’s own failures. The private deposit insurance fund, for which the FDIC is responsible, became insolvent during this crisis and remains so; without the full faith and credit of the U.S. behind them, they like Indymac and many others, would have failed.
Importantly, Indymac decided in 2000 to carry out its business model through the acquisition of a depository institution whose deposits were insured by the FDIC. Because of this decision, Indymac – unlike government-sponsored mortgage lenders Fannie Mae and Freddie Mac (and others) — has not cost U.S. taxpayers one penny. And while the seizure of Indymac Bank has cost the FDIC’s insurance fund billions, industry experts and others (including me) believe that much of the insurance fund’s loss was avoidable, if only the FDIC had worked with us to save the bank when that was still possible or if the FDIC had made better decisions as conservator once it took over the bank.
Not one of the lawsuits against me has any merit.
I, and the management team and directors of Indymac Bank, made prudent and appropriate business decisions based on the facts available to us at the time and always with the primary goal being to keep Indymac Bank safe and sound, within the parameters of our regulatory-approved, mortgage lending business model. And importantly, we always acted with honesty, integrity and complete transparency and properly complied with all relevant regulations and laws.
The plaintiffs know this and as a result do not want these matters to go to trial where they will lose. This is what happens in America today. Frivolous lawsuits rarely go to trial and nearly always settle despite their lack of merit, because of the time and cost to defend against them (and perversely having a “pot” of liability insurance, or even better a deep-pocket, corporate indemnification, encourages more lawsuits and more settlements). It is particularly disheartening though, to have U.S. government agencies like the SEC and FDIC engaged in this type of behavior in order to further their own image without regard to the damage done to the reputation, career, and finances of honest individuals like myself and others. And it’s not just me and my family that is adversely affected. I believe these legal tactics have a long-term cost to our country’s economic potential and erode our standards. In regard to my latter assertion, I don’t think most Americans are aware (I wasn’t until recently), but there is an exemption in our defamation laws that “privileges” plaintiff’s lawyers and allows them to distort facts and make untrue statements and defame defendants like myself, without any consequence, even if the defendant proves so later in a court of law. This doesn’t seem right, does it?
In conclusion, this site’s purpose is to counter the allegations in these lawsuits (and regurgitated in the press as authoritative, when they are not) with the truth and the facts, for those who care to spend the time to read the documents on this site and understand them. I plan to start out slowly, focus on the government cases, and then if I have the time and it is warranted, expand the site to include my views based upon my experiences and post-crisis study of its true systemic and macroeconomic causes.