Abacus federal savings bank chinese9/11/2023 underestimated the resolve of the Sungs who refused to passively plead guilty to a felony and made the “courageous and expensive choice” of fighting the charges.Īnd so the investigation that began in 2010 led to a 4-month trial and 9 days of jury deliberations in 20I5. seemed to think that Abacus and the big banks had much in common (“The principle was the same.”), but in truth, whatever the similarities in their loan underwriting and processing practices, Abacus did not deal in subprime mortgages and expected it borrowers to repay their loans which they did. By contrast, gargantuan institutions like Citicorp, Bank of America, and Wells Fargo received millions in bail out funds, but were never prosecuted because they were “too big to fail.” Vance et al. Abacus is America’s 2,651 st largest bank. The prosecution asserted that knowledge of the practices of the bank’s corrupt loan personnel went high enough up its hierarchy to charge the bank itself with participating in “a systematic scheme to falsify and fabricate loan applications to Fannie Mae.”Ībacus the Documentary shows the great lengths to which the Manhattan DA’s office goes to make a tiny minority bank out to be a prime example of the abuses that led to the financial crisis. The chief witness for the state was none other than Ken Yu. announced a 184-count indictment against the bank and 11 of its current and former employees that accused them of, among other things, conspiracy, grand larceny, falsifying business records, and residential mortgage fraud. In May of 2012, District Attorney Cyrus Vance, Jr. When one of them went to the police, the Manhattan District Attorney’s Office got involved. Yu was also extorting money from borrowers. The bank immediately reported the matter to the appropriate bank regulators and hired a consultant to unearth the full extent of the fraud. In December of 2009, Vera Sung discovered that Ken Yu, one of Abacus Bank’s loan originators, was writing “liar loans,” i.e., loans supported by false documentation of such information as the borrower’s job titles, income, and sources of down payment. Finally, Abacus illustrates the importance of informal and flexible lending practices to bringing the unbanked and underbanked members of racial and ethnic minorities into the formal market for financial services and credit, a notion known as “the democratization of credit.” Second, Abacus exposes the incompetence of a prosecution that, in failing to understand the cultural context of an ethnic minority bank and its customers, winds up exploiting and reinforcing economic stereotypes and biases about them. First, Abacus provides a window into the operation of a small family-run, community-focused ethnic bank, both in general and in a time of crisis. The film offers three very important insights on economic equality and minority-group advancement. The bank was the only financial institution tried for mortgage fraud in the wake of the subprime lending debacle that led to the Great Recession of 2008.Ībacus: Small Enough to Jail, a documentary by Steve James, follows the course of the criminal proceedings from the perspective of the Sungs. One of his daughters (Jill) is its president and CEO and another (Vera) is a director and its closing attorney. It was founded by Thomas Sung, a Chinese American, in 1984. Steve James presents the story of the Sungs and their struggle to save their family-run Chinatown bank from a misguided prosecution based on cultural incompetence.Ībacus Federal Savings Bank is a small institution that is headquartered in Manhattan’s Chinatown and serves an Asian American and Asian immigrant population.
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