July 8, 2025 #1 Local News, Information and Event Source for the Century City/Westwood areas.

Los Angeles Councilman Threatens Two Wall Street Banks

Los Angeles
Los Angeles CIty Council News on WestsideToday.com (Thinkstock)

A Los Angeles city councilman threatened on May 2 to stop doing business with two Wall Street banks that he says has charged taxpayers $65 million in predatory fees since the banking meltdown in 2008.

Councilman Paul Koretz, who represents several Westside communities, is urging NY Mellon Bank and Dexia to release the City from financial deals that has led to tens of millions of dollars in fees, with millions more to come.

One interest rate swap deal the City entered into with the two banks in 2006 to pay for wastewater infrastructure projects, along with other deals, are “costing us dearly, even today, while NY Mellon reaps massive profits,” Koretz said during a City Hall news conference.

Bank officials were not immediately available for comment.

If the city remains in the deals, it could lose another $69 million through 2028, Koretz said. But in order to get out of those arrangements, the City would need to fork over $24 million to the banks, he said.

If the banks refuse to renegotiate with the city or to terminate the deals at no cost, then the city would “consider terminating any current business with these banks and excluding NY Mellon and Dexia from all future business with the city,” according to a motion introduced by Koretz.

While the Federal Reserve has artificially slashed interest rates for banks, giving financial institutions “access to cheap money,” cities and others obtaining financing from those banks are unable to get out of bad deals without needing to pay fees, according to the motion, which was seconded by Councilman Gil Cedillo.

The potentially costly fees were highlighted in a report released by Fix L.A., a coalition representing Los Angeles residents and city employee unions.

Lisa Cody, an analyst with SEIU Local 721, a union representing city employees, said the report “documents a growing body of evidence suggesting that Wall Street has engaged in predatory lending practices when providing municipal financing to cities and government.”

According to the report, the city has already paid $204 million in fees to financial institutions, on top of the $65 million lost when the city got out of other less-than-ideal financing agreements.

NY Mellon and Dexia has “millions of dollars” of business with the city that includes real estate transactions and letters of credit, according to Cody. The banks also act as the custodians for securities lending for the City and the Dept. of Water and Power, she said.

The city has faced “difficult circumstances” as a result of the financial crisis in 2008, so while the banks may not have intended for the deals to go south, “NY Mellon Bank and Dexia need to do what many others have done for the sake of the city, and that is to make sacrifices and not obscene profits,” Koretz said.

The councilman’s motion, if approved, tells Office of Finance staff and other city officials to meet with the banks to rework the deals or reach an agreement allowing them to get out of them without needing to pay a penalty.

Staffers would be expected to report back on their progress in 30 days.

The motion still needs to work its way through the City Council committees and may take a “month or so,” to get to the full council, Koretz said.

The City Council also is amid budget hearings and is expected to hear from city employee unions on Monday, when City Administrative Officer Miguel Santana’s staff was expected to discuss Fix L.A.’s report.

Related Posts

Interview: The Dinah Creator Mariah Hanson on Legacy, Change, and the Future of Queer Celebration

July 8, 2025

July 8, 2025

After 34 Groundbreaking Years, Hanson Reflects on Joy, Power, and Her Final Dinah  We spoke with Mariah Hanson, the creator...

Shore Hotel: A Local Destination for Summer Fun

July 8, 2025

July 8, 2025

Bring on all things summer. Walking or biking along Santa Monica Pier, you might find yourself taking a pause at...

One Last Bite: La Novia Bids Farewell with Final Pop-Up at Cardinale du Vin

July 7, 2025

July 7, 2025

Inventive Latin-Asian Pop-up Serves Seasonal Small Plates for One-Night-Only La Novia, the pop-up kitchen known for its inventive Latin-Asian flavors,...

Governor Newsom Unveils Fast-Track Rebuilding Plan on Six-Month Anniversary of Palisades Fire

July 7, 2025

July 7, 2025

State Clears Over 5.5 Billion Pounds of Debris From Fires Ahead of Schedule Marking six months since the devastating Eaton...

Soprano Golda Zahra Returns to BroadStage For a One-Night-Only Musical Celebration

July 7, 2025

July 7, 2025

Hailed as “the rising star of the opera world” by The Hollywood Times, internationally acclaimed soprano Golda Zahra makes her much-anticipated return to BroadStage in...

Transform Your Life: The Free Virtual ONENESS GLOBAL SUMMIT Debuts July 18-20, 2025

July 7, 2025

July 7, 2025

The ONENESS GLOBAL SUMMIT, a transformative three-day virtual event, is coming, July 18-20, 2025, offering participants worldwide a free opportunity...

Bel Air and Holmby Hills Estates Lead May’s List of America’s Top 10 Home Sales

July 7, 2025

July 7, 2025

LA Claims Two of the Top Three Luxury Home Sales Last Month expensive residential transaction in the U.S. for May,...

Developer Seeks to Replace Mid-Century Building With 65 New Units in Palms

July 7, 2025

July 7, 2025

Apartment Complex Near E Line May Be Demolished for Larger Housing Project Mid-century apartments near Metro’s Palms Station are set...

Michael Madsen, Star of Reservoir Dogs and Kill Bill, Dies at 67 in Malibu

July 4, 2025

July 4, 2025

Actor Remembered for His Intense Performances and as a Poet  Actor Michael Madsen, known for his distinctive gravelly voice and...

Los Angeles City Council Cracks Down on ‘Disaster Tours’ in Pacific Palisades

July 4, 2025

July 4, 2025

City Council Bans Commercial Bus Tours in Burn Zone Amid Community Backlash Tour buses that have been operating in fire-ravaged...

Tow Truck Scammers Target Crash Victims Across L.A.: Authorities Warn of Fraud at Accident Scenes

July 4, 2025

July 4, 2025

Officials Urge Drivers to Stay Alert After Collisions as Rogue Operators Demand Inflated Fees  Motorists involved in vehicle accidents are...

Woman Dies After Melrose Store Altercation: LAPD Launches Homicide Investigation

July 4, 2025

July 4, 2025

Critically Injured Young Woman Died July 2, After She was Badly Beaten at Work  The death of a woman critically...

CHP Officer Dies in Culver City Crash: Medical Emergency Suspected Behind Tragic Incident

July 4, 2025

July 4, 2025

Officer lost consciousness while transporting a suspect before crashing into a tree California Highway Patrol Officer Miguel Cano died early...

L.A. Beaches Brace for Holiday Rush: Over 1 Million Visitors Expected This Fourth of July

July 4, 2025

July 4, 2025

County Officials Urge Beachgoers to Pack Out Their Trash and  Monitor Water Quality More than one million visitors are expected...

(Video) A visit to New York Bagel & Deli in Santa Monica

July 3, 2025

July 3, 2025

Authentic NY Style Bagels with Extra Creamy Cream Cheese and Multi-Cultural Desserts. Located at 2216 Wilshire Blvd. A visit to...