Mr Cooper Group Inc (COOP)

[islandcat]

Why WMI Some Real Estate Interests May Go to JPM--Clue
(i found this posted on a different broad)

Many continue to opine that a real estate companies should not end up in JPM’s lap. But there may be good reasons why Second and Union LLC did, or at least is being claimed by JPM.

The example below shows how a seemingly unrelated “real estate” company might well have been an indirect sub of WMI--but a direct sub of the Bank. I’m guessing—due to the name—that Seneca is also a real-estate related entity. And in this case, it appears to be a direct sub of the Bank.

Per a CA Insur Commissioner’s Feb 2007 exam of a WaMu insurance company, the organizational structure was set up like this—with each company listed being a sub of the one above it:

Washington Mutual, Inc. (WA Corp)

--New American Capital, Inc.(DE Corp)
---->Washington Mutual Bank, FA (WA Corp)

----------Marion Holdings, Inc. (CA Corp)

---------------Washington Mutual Life Insurance Co. of CA, a Stock Insurer (CA Corp)



But during the Exam, the official was informed that WMI had made the following changes to the org structure Jan 1, 2007:

1—It “converted” Marion Holdings, Inc. to WM Marion Holdings LLC

--Marion Holdings Inc is listed on WMI’s revised asset list. However, per this 07 insurance report, it was “converted” into another LLC company. But some A&M billing entries refer to the name "Marion" in relation to work on WaMu insurance holdings; so it may have lived on. Or it's possible the person with whom the Insurance Examiner spoke was in error.

--The new incarnation--WM Marion Holdings LLC--is on JPM’s asset list

2--After it was “converted” to WM Marion Holdings LLC it was “made” a subsidiary of Seneca Holdings, Inc., which, the examiner was told, is a direct sub of the BANK.

So according to the company, SENECA was sandwiched between the BANK and WM Marion Holdings LLC, to form this new structure:

Washington Mutual, Inc. (WA Corp)

--New American Capital, Inc.(DE Corp) [sub of WMI]

--> Washington Mutual Bank, FA (WA Corp) [sub of NACI]

---------Seneca Holdings, Inc. [sub of WaMu Bank]

-------------WM Marion Holdings LLC [formerly Marion Holdings, Inc]. (CA Corp) [sub of Seneca[

---------------- Mutual Life Insur. Co. of CA, a Stock Insurer (CA Corp) [sub of WM Marion..]

The examiner’s report says, ““all ownership remains 100% within the holding company structure.” True, it’s all within the STRUCTURE. But in this case, three entities appear to be entirely contained within WaMu BANK, as subs, and therefore don’t tie directly back to WMI—except THROUGH the bank. At least from this “paper” view.

So if the bank is removed, what happens? Does everything from the line “Washington Mutual Bank” and BELOW—get swept into JPM’s arms? Or are there ownership percentages that would allow WMI to claim a certain percentage of the bank’s subs?

On the face of it, it appears to be an interlocked chain. And it appears if you remove the WaMu BANK link from the chain, you also remove WMI’s linkage to a daisy chain of subs that reside beneath WM Bank on the corporate structure.

Again this is only one sub example--we do NOT know which or how many of the other subs were set up this way.

There must have been advantages to setting up an insurance co. this way. After all--what was there to fear? I’m sure WMI never imagined that the Bank could be stolen right out from under it…taking a string of subs with it.

Note “changing the org structure in January 1, 2007.” What was happening on a macro level at that time that might have prompted a change in org structure?

Perkins-Coie law firm, per their most recent billings, have worked for WaMu from at least the year 2000, maybe longer. Pre-petition, they represented WMI in “intellectual property, general corporate, and employment law matters.”

Wouldn’t they have copies of ALL the LEGAL structures that underpinned all the organizational changes WMI made in 2007? And, over time, wouldn’t they have gathered articles of incorporation and partnership agreements for ALL WMI and WMB subsidiaries—so as to be able to answer, definitively, what belongs to which entity? If not Perkins-Coie, was there another local law firm that represented WMI for years that would have such records?

Those wishing to investigate further--I found some mentions in the 10K that deal with percentages of ownership in various indirect and direct subs that may shed some light on whether these are clear-cut “JPM winnings” or whether some percentage rightfully belongs to WMI. But I don’t have the patience to try to decipher them.

In addition, I have noticed the term "affiliates" included in court document narratives by Weil and others, and am not sure if that is a "technical" term describing a specific ownership relationship or not.

det

SOURCE -

http://www.insurance.ca.gov/0250-insurers/0300-insurers/0400-reports-examination/upload/Wash_mut_life_ca_05.pdf