"Let me help a few victims I created by ripping them off and illegally throwing them out of their homes by false court filings that I swore were true." That's what the so-called mortgage settlement talks are really all about: fraud, perjury and crimes. That's what these banks did and that's what they are trying to buy their way out of.
The settlement discussions are the same: eliminate all or almost all liability for the bank and, most importantly, all bank officers and employees in exchange for a loan forgiveness or modification program. Think about this: the banks engaged in a years' long pattern and practice of what can only be described as fraudulent if not criminal conduct that would put anyone else in prison for years if not decades, yet banks get to buy off the cops with some money to help just a few of the victims they created.
Worst of all, there is no requirement in any of these talks that I'm aware of that require the banks to come clean, publicly release all the relevant documents and provide sufficient information on their conduct so that anyone can evaluate whether the sell-out, I mean, pay-off, oops, I mean, "settlement" is anywhere near adequate.
And they get to buy their way out of prosecution for chump-change. It's reported that the settlement is going be $25 billion, with only $5 billion in cash and $20 billion in "loan forgiveness." That's nothing. There are more than 10 million homes under water where the amount they owe on their mortgages is more than the house is valued, i.e., could be sold for. $20 billion doesn't make a dent in that: 1 million homes at $20,000 loan forgiveness is it. And, remember, $20 billion in loan forgiveness to the banks is not equal to $20 billion in cash. It is probably more like $10 billion, if that, due to accounting, prior write-downs and similar shenanigans.
There is also the risk of a tacit conspiracy here. The banks want to "put this behind them" (gee, who wouldn't) and escape from real liability (criminal and civil) and the prosecutors (many of them politicians) and the administration want to claim victory. You will hear that the settlement was the largest, one of the largest or the greatest settlement in history that will help millions or billions or trillions of people who need help -- you get the point: no hyperbole will be spared.
As if all that wasn't bad enough, the most egregious aspect of all this may be the reporting: stories repeatedly use innocuous, but grossly misleading words that obscure what really happened here. For example, so-called "robo signing" is massive, systematic, fraudulent, criminal conduct. This is where banks themselves or their contractors sign legal documents to file in court swearing under oath that the facts are true and therefore support the legal application to take someone's home away from them, i.e., foreclose.
Can you think of anything more despicable? Lying under oath to get someone thrown out of their home and onto the street. That's what robo-signing means and what it obscures every time that word is used. Then, there's always someone saying, basically, no harm, no foul because it's just a "paper work" problem and these people are all delinquent and "deserve" to be thrown out on the street. Really? Since when does saying "trust us" while we lie to you under oath make illegal conduct acceptable?
And, the fraudulent if not criminal conduct occurred throughout the boom as well as the bust (when the robo-signing and other criminal conduct occurred). For example, there are unending examples of mortgage brokers changing income, job history and other material terms in mortgage applications without the person having any knowledge of it. Another example is putting large amounts of unqualified mortgages into packages that were securitized in violation of the required representations and warranties.
Anywhere else this would be called lying, cheating and stealing and it's past time it gets called by the right name. And, everyone should insist on no settlements by anyone that includes the elimination of liability for a corporation or any of its officers or employees unless it also includes a requirement that all documents related to the conduct are all publicly disclosed on a central, searchable website. That won't happen because they the conduct of the prosecutors and politicians in the sellout, er, settlement could be evaluated along with the conduct of the banks -- see the problem here?
If they are getting any legal immunity, which is what they are demanding, then the American people deserve to at least know what laws they violated and how they did it so everyone knows what they are getting immunity for. That simply must be a price for forgiving what has been years of unconscionable fraudulent and almost certainly criminal conduct that has victimized tens of millions of American families, hollowed out neighborhood after neighborhood, and stuck millions more homeowners with underwater mortgages through no fault of their own.
Van Jones: Bank Settlement: $25 Billion Down, $675 Billion to Go
Yves Smith: The Top 12 Reasons Why You Should Hate the Mortgage Settlement
Jed Kolko: The Robo-Signing Settlement: Breaking the Usual Rules of Housing Policy
It was a scam of overpriced houses and easy mortgage loans by Lenders to run up the housing market (as wall st. does to the Stock Market) and then let it crash after the Big investors made billions and the little guy his home!
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The Republicans created the Recession and are now blaming the Democrats!
Democratic president Clinton left Republican George Bush a budget surplus when Bush became president. But the Republicans, as usual, deregulated banks and Wall street and allowed Big Business to scam and loot the American taxpayer again!
MILLIONS OF US ARE the victims of the Republicans banks and lenders clever scam.
The Banks and Wall St. Lenders need to charged and put on trial by the government to
expose the new "Savings and Loan" scam, i.e. the "Sub-Prime" loans scandal.
The banks and lenders are not stupid. They knew when they enticed eager buyers
with easy, risky loans that many of the Sub-Prime borrowers
would default and the Banks would get the properties back to sell again.
The Banks were not risking their loan money because mortgage loans are
insured 3 ways; One; by private mortgage insurance (PMI), which the buyer pays for
and two; the US government insures the Lenders money thru Fannie Mae and
three; the Government even insures the insurers thru Freddie Mac!
THE BANKS LOST NOTHING!
Also, don't think this is a Republican problem. Glass-Steagall was revoked under Bill Clinton with a Democratic Congress and this administration just inked the cover-up of the corporate plunder which will continue unabated until the people stop blaming themselves, others, each other and the political parties. Hold the criminals accountable for their crimes, but do not buy the propaganda that this is a partisan problem.
Whether it is Reagan de-regulating the meat industry and allowing poison hot dogs to kill children or Bush looking the other way while working people lost their homes and jobs it is all the result of REPUBLICAN DEREGULATION!
THE BANKS GET BAILOUTS AND THE LITTLE INVESTOR GET'S A DEATH SENTENCE!
"A PRISON SENTENCE FOR ME WITH MY MEDICAL PROBLEMS IS A DEATH SENTENCE " SAYS 71 YEAR OLD THOMAS SULLIVAN OF ORANGE CITY, FLORIDA.
"IT'S NOT FAIR.. THE FBI AND IRS IN ORLANDO HAS BEEN HARASSING ME FOR 5 YEARS AND ARE NOW THREATENINÂG TO SEND ME TO PRISON FOR 5 YEARS! I AM NOT A CRIMINAL AND HAVE NEVER BEEN ARRESTED!
I FEEL I WAS A VICTIM OF THE REAL ESTATE PROFESSIONÂALS WHO WERE AFTER MY MONEY AND 700 CREDIT SCORE AND LURED ME IN WITH EASY, NO-MONEY DOWN, RISKY, MORTGAGE LOANS TO BUY OVERPRICED HOMES IN AN INFLATED ORLANDO REAL ESTATE MARKET WHICH QUICKLY CRASHED LEAVING ME WITH MULTIPLE FORECLOSURÂES AND NO CREDIT!
ALL THOSE LICENSED PROFESSIONÂALS ( REALTORS, MORTGAGE BROKERS, APPRAISERSÂ, AND TITLE COMPANIES) WHO TOLD ME EVERYTHING WAS LEGAL, MADE THEMSELVES LOTS OF MONEY FROM COMMISSIONÂS ON THE PROPERTIES I PURCHASED FROM THEM AND I WOUND UP BROKE AND BEING THREATENED BY THE FBI TO SPEND THE REST OF MY LIFE IN PRISON.
I NEED HELP TO STOP THIS UNFAIR GOVERNMENT POLICY AND INJUSTICE OF PROSECUTINÂG THE LITTLE INVESTORS AND THROWING THEM INTO JAIL WHILE GIVING THE ARCHITECTS AND PROFITEERS OF THE SUB-PRIME MORTGAGE SCAM, THE BIG BANKS AND WALL STREET OUR TAX MONEY TO "BAIL" THEM OUT!
WHERE IS THE JUSTICE IN AMERICA ?
The $20B for modification and assistance is just another legerdemain tactic used to spoon feed the public into thinking our system of government is looking out for their best interest. Modifications will never occur because the real party in interest (the one who has the right to foreclose) is not the bank ... it's the RMBS investor.
It's a travesty and the fallout from this has yet to be felt.
We, the People, will never forget you.