12 Occupy Philadelphia protesters who staged a sit in at a Wells Fargo bank in Center City Philadelphia were acquitted of charges of conspiracy and defiant trespass for a 2011 protest during the Occupy Wall Street movement.

Late last week, the Justice Department issued a filing that attempts to reinforce the release limitations set by the foreclosure fraud settlement, stopping Wells Fargo from reimagining the deal as a broader release of liability on various mortgage claims. However, a judge will have to make the final decision.

The US sued Wells Fargo in late October over issuing insurance claims on FHA loans while knowing that the loans did not meet underwriting requirements set by the agency. Wells charged in court that these specific charges were covered under the foreclosure fraud settlement. I actually thought Wells made a fairly compelling case on that front, but the DoJ disagrees.

Bull by the Horns is the story of financial calamity seen from the perspective of this public servant, rendered from detailed notes. We learn with whom she met, what was said, what decisions taken, and how things turned out. She begins with the battles over deregulation of the banks (Basel II), with the gathering sub-prime storm, and proceeds through the disaster: WaMu, Wachovia, Citigroup, Bank of America, AIG, Citigroup again. And then the battles of the aftermath, over among other things Dodd-Frank, Basel III and the robosigning frauds. This is a book for aficionados of infuriating detail.

The failings of the 49-state foreclosure fraud settlement have by now become so obvious that even traditional media cannot ignore it. When half of the $2.5 billion earmarked as a hard-dollar penalty to states for aid and relief for struggling homeowners just gets sucked up into filling state budget holes, you can hardly make any excuses. And the other 90% of the settlement isn’t exactly destined to flow into the hands of homeowners, either; as we know, banks will probably honor up to 1/4 of their “penalty” by doing things they already do as a routine part of their business.

There’s another potential element to this that we’re already starting to see. In relation to a resolution outside the settlement, Wells Fargo has been sending along refund checks to homeowners who overpaid for loans that the bank steered them into. Just one thing, though: the refund checks, if cashed, serve as a legal claim of liability release.

Andrew Ross Sorkin uses his column today to highlight to troubles of those suffering the most from the downturn: the CEOs of major banks who bought up failing competitors in the midst of the financial crisis. Jamie Dimon, J.P. Morgan’s CEO, get center stage for having to deal with Bear Stearns’ legal liabilities, but Sorkin also has some tears for Wells Fargo, which bought up Wachovia, and Bank of America, which took over Merrill Lynch.

FHA’s balance sheet is currently in a precarious position, but CAP argues that the expansion of that balance sheet, which now totals $1.1 trillion, helped keep credit flowing since the collapse of the bubble. “Home prices would have plummeted even further, households would have lost much more wealth than they already did during the crisis, and even more families would have lost their homes to foreclosure,” the paper claims. CAP further alleges that FHA will not require a sustained injection of public funds to keep going (through a standing line of credit it holds with the US Treasury but has never tapped), as the mortgages it insured in recent years look to be profitable. And even if FHA did need to pull funds from the line of credit, that would represent a solid investment for taxpayers, given the support that FHA provided the economy.

I mentioned in passing yesterday this federal civil lawsuit against Wells Fargo for its conduct on some FHA loans. “Mentioned in passing” is all that the suit deserved, but I see that the PR shop at DoJ tried to turn this into a big deal, with the media playing along. So maybe I should put together a short and sweet FAQ on this lawsuit, to place it in the proper context.

Let me roll back to that story in the Inland Empire of California, where Wells Fargo broke into and destroyed the wrong house, one that didn’t even have a mortgage. Here’s a funny story: this was not the first time Wells’ contractors broke into that house. It was the second.

❖ An unidentified prisoner at Guantanamo has died; “investigation pending into cause”.

There are several layers of alleged safeguards to prevent this from ever happening. It’s not the kind of thing that can be explained by a wrong address – this happens too often for that to be the case. The address was written on all the forms because the banks have about as much knowledge about who owns what and why as the convenience store clerk down the street. The subcontractors destroyed this house, and got paid handsomely for it.