Sign up for our daily briefing

Make your busy days simpler with Axios AM/PM. Catch up on what's new and why it matters in just 5 minutes.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on the day's biggest business stories

Subscribe to Axios Closer for insights into the day’s business news and trends and why they matter

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Stay on top of the latest market trends

Subscribe to Axios Markets for the latest market trends and economic insights. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sports news worthy of your time

Binge on the stats and stories that drive the sports world with Axios Sports. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Tech news worthy of your time

Get our smart take on technology from the Valley and D.C. with Axios Login. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Get the inside stories

Get an insider's guide to the new White House with Axios Sneak Peek. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Denver news?

Get a daily digest of the most important stories affecting your hometown with Axios Denver

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Des Moines news?

Get a daily digest of the most important stories affecting your hometown with Axios Des Moines

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Twin Cities news?

Get a daily digest of the most important stories affecting your hometown with Axios Twin Cities

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Tampa Bay news?

Get a daily digest of the most important stories affecting your hometown with Axios Tampa Bay

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Charlotte news?

Get a daily digest of the most important stories affecting your hometown with Axios Charlotte

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Nashville news?

Get a daily digest of the most important stories affecting your hometown with the Axios Nashville newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Columbus news?

Get a daily digest of the most important stories affecting your hometown with the Axios Columbus newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Dallas news?

Get a daily digest of the most important stories affecting your hometown with the Axios Dallas newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sign up for Axios NW Arkansas

Stay up-to-date on the most important and interesting stories affecting NW Arkansas, authored by local reporters

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Illustration: Aïda Amer/Axios

Major banks including Wells Fargo, Deutsche Bank and others have engaged in a pattern of fraud in commercial mortgage-backed securities that is putting the whole market at risk, according to a whistleblower complaint submitted to the SEC, ProPublica reported Friday.

Why it matters: That report was published on the same day as the Fed's financial stability report, which warned the commercial real estate market could be among the hardest-hit industries from the coronavirus pandemic.

The big picture: Should there be a washout in the CMBS market it could have a major impact on the real economy, similar to what happened with mortgage-backed securities in the 2008 global financial crisis, ProPublica notes.

What they're saying: The Fed cited commercial real estate as being particularly susceptible to a major decline in asset prices because “prices were high relative to fundamentals before the pandemic,” and COVID-19 has caused major disruptions in the hospitality and retail industries, "putting the ability of these sectors to make timely mortgage and rental payments into question."

  • Those prices were artificially inflated by the banks, ProPublica reports, citing the SEC complaint, with lenders and securities issuers regularly marking up financial data for commercial properties by as much as 30% “without justification.”
  • The changes "make the properties appear more valuable, and borrowers more creditworthy, than they actually are."
  • "As a result, it alleges, borrowers have qualified for commercial loans they normally would not have, with the investors who bought securities birthed from those loans none the wiser."

Go deeper: Coronavirus is upending the U.S. mortgage market

Go deeper

Dion Rabouin, author of Markets
Aug 18, 2020 - Economy & Business

The American real estate conundrum

Reproduced from CivicScience; Chart: Axios Visuals

The housing market has been a solidly bright spot in the U.S. economy in recent months.

Yes, but: There remain serious questions about what the next phase for the market will be as the coronavirus pandemic has created an enormous amount of uncertainty about where and how people will live.

"Atmospheric river" swings Northern California from drought to flood

Satellite view of the bomb cyclone swirling off the coast of the Pacific Northwest and the atmospheric river affecting California on Oct. 24. Photo: CIRA/RAMMB

A series of powerful "atmospheric river" storms are delivering historic amounts of rainfall across parts of drought-stricken California and the Pacific Northwest — triggering widespread power outages and flooding.

Why it matters: The strong atmospheric river, packing large amounts of moisture, is causing Northern California to whiplash from drought to flood.

Updated 2 hours ago - World

Saudi dissident claims MBS said he could get "poison ring" to kill king

Saudi Crown Prince Mohammed bin Salman attending the Saudi Green Initiative Forum, via video link, in Riyadh, Saudi Arabia on Saturday. Photo: Royal Court of Saudi Arabia/Handout/Anadolu Agency via Getty Images

A former senior Saudi intelligence official who worked with the U.S. on counterterrorism alleged to "60 Minutes" in an interview broadcast Sunday that Crown Prince Mohammed bin Salman discussed in 2014 killing the kingdom's then-monarch.

Why it matters: The claim by the exiled Saad al-Jabri, whom Saudi authorities describe as "a discredited former government official," that the crown prince, known as "MBS," allegedly said he could obtain a "ring from Russia" to carry out the attack, is one of several serious but unproven allegations he made on the CBS show.