The fix was in to let the Wall Street scoundrels off the hook for the enormous damage they caused in creating the Great Recession. All of the leading politicians and officials, federal and state, Republican and Democrat, were on board to complete the job of saving the banks while ignoring their victims... until last week when the attorney general of New York refused to go along.
Eric Schneiderman will probably fail, as did his predecessors in that job; the honest sheriff doesn't last long in a town that houses the Wall Street casino. But decent folks should be cheering him on. Despite a mountain of evidence of robo-signed mortgage contracts, deceitful mortgage-based securities and fraudulent foreclosures, the banks were going to be able to cut their potential losses to what was, for them, a minuscule amount.
In a deal that had the blessing of the White House and many federal regulators and state attorneys general -- a settlement probably for not much more than the $5 billion pittance the top financial institutions found acceptable -- the banks would be freed of any further claims by federal and state officials over their shady mortgage packaging and servicing practices and deceptive foreclosure proceedings.
At the same time, the SEC and other federal regulatory bodies are making sweetheart deals with the bankers to close off accountability for creating and collecting on more than a trillion dollars' worth of toxic mortgage-based securities at the heart of the nation's economic meltdown--a meltdown that has seen the national debt grow by more than 50 percent, stuck us with an unyielding 9 percent unemployment and left 50 million Americans losing their homes to foreclosure or clinging desperately to underwater mortgages. On top of which an all-time high of 44 million people are living below the official poverty line and fewer new homes were started in April than at any other time in the past half century. With housing values still in free fall, we continue to make the bankers whole.
As Gretchen Morgenson reported in the New York Times, the Justice Department division responsible for checking for fraud in the bankruptcy system has found a widespread pattern of deception by banks foreclosing homes, and she concluded: "So an authoritative source with access to a lot of data has identified industry practices as not only pernicious but also pervasive. Which makes it all the more mystifying that regulators seem eager to strike a cheap and easy settlement with the banks."
Not really surprising given both the enormous hold of Wall Street money over the two major political parties and the revolving door through which executives travel between firms like Goldman Sachs and the top positions in the U.S. Treasury Department and elsewhere in the government. The financial crisis occurred only because Republicans and Democrats passed the laws that Wall Street lobbyists wrote ending reasonable banking industry regulation installed in the 1930s in response to the Depression. And when the greed they enabled threatened the foundations of our economy, under Bill Clinton, George W. Bush and Barack Obama, it was the bankers who were assisted into lifeboats that had no room for ordinary people.
Not surprising then to find all of the power players in on the latest deals: the Obama administration that had bailed out the banks but not troubled homeowners; the regulators and Fed officials who all looked the other way when the housing bubble was inflated; and the state attorneys general who backed away from going after the perpetrators of robo-signed mortgages and other scams used to foreclose homes.
But now Schneiderman has a chance to derail the deals, given that he is supported by the state's tough 1921 Martin Act, which one of his predecessors as New York state attorney general, Eliot Spitzer, had used to good advantage in exposing the financial behemoths that are so heavily based in New York. The Wall Street Journal describes the Martin Act as "one of the most potent prosecutorial tools against financial fraud" because, as opposed to federal law, it doesn't carry the more difficult standard of proving intent to defraud.
Last week, it was revealed that Schneiderman's office has demanded an accounting from Bank of America, Morgan Stanley and Goldman Sachs as to the details of their past practice of securitizing those mortgage-based packages that proved so toxic. Maybe he will fail against such powerful forces, as did Spitzer and Andrew Cuomo after him, but it is a test worth watching, since no one else, from the White House on down, seems to be concerned with holding the bailed-out banks accountable for the massive pain and suffering they inflicted on the public.
And instead of going after the bad guys, our government functions so as to reward them with ever greater profits and bonuses.
I guess it would take a real revolution to have the Wall Street bad guys end up like Bin Laden.
I love how all the partisan kool aid drinkers will simply act like
they don't savvy that.
Eric Schneiderman is a man who should run for President int this next election. He would have my vote, even if his enemies discovered skeletons in his closet. Integrity, honor and courage under the Constitution are what this nation needs most of all.
Robert Scheer should be decorated and redecorated with accolades for his unyielding sacrifice and dedication to our proclaimed form of government. May the angel of goodness and spirit of courage be his constant companions.
Attorney General Eric Holder is wasting his time and our money trying to fight Medical Marijuana (which I’m not sure is constitutional, states have rights) but won’t defend the constitutionality of the Defense of Marriage Act ("DOMA"), which I’m very confident is unconstitutional. But after reading this article I’m more then confused! They want to cut poverty fighting measures like child tax credits, earned income credits, unemployment insurance, school meals, WIC & home energy assistance to balance the budget (many victims of this great mortgage scam are likely needing right now) and we should and could be going after the big banks for restitution.? They ruined our economy aka tax revenue stream and their victims which is almost every middle class American and those who barely have their head above water and they are making record breaking profits borrowing money from the FED for nothing, costing the FED more money! What kind of alternate universe are we in?
TD Miller
Decorated, Disabled Vet
http://www.pbs.org/wgbh/pages/frontline/meltdown/view/
on Monday nite 10 oclock PM HBO they are showing supposedly a very good accounting MOVIE
They must be prosecuted or else they will do it again. In point of fact after tanking the economy with toxic mortgages and derivatives and with no prosecution on the horizon, they committed even more fraud with robosigning.
Not only did they sign thousands documents they had not read and presented to the courts as legal documents which is also a crime. They forged documents and signatures in order to perpetrate their crimes. In many instances there was no dispositive proof the banks who executed some foreclosures actually held the mortgage.
One fraud heaped upon another which is frightning because the second wave of criminal activity took place immediately following their exposure to the first wave of criminal activity. That's why it is critical to prosecute them and regulate the banks, wall street and industry.
Failure to do so will result in the predepression institution of the "Company Store."
The Wall Street Tsunami of fraud and deceit. Go get them Eric.