In November 2010, the Roosevelt Institute hosted an event in Washington taking a hard look at a strange phenomenon in U.S. housing. Banks, it appeared, were fabricating documents to pursue foreclosures under outrageous, chaotic circumstances ― not accepting mortgage payments, miscalculating debts, rewriting loan terms without consulting homeowners and trying to evict people who hadn’t missed payments. The event wasn’t a glitzy Washington spectacle. The guests of honor were stressed-out homeowners who showed up to detail their financial nightmares for a handful of journalists.
Sitting in the back and nodding along calmly was Eric Schneiderman, a promising young politician who had just been elected attorney general of New York. Afterward, he made the rounds shaking hands. This was an important issue, he told the reporters. He wasn’t a housing expert, but he didn’t trust the banks. Something had to be done.
It would soon become clear that his masterly performance was a total con. There is perhaps no reputation in American politics over the past generation more undeserved than the acclaim that has surrounded Schneiderman as a principled, tough-on-white-collar-crime Democrat.
After the Roosevelt Institute event, he pounded the microphones for months as a vocal holdout against President Barack Obama’s $25 billion national mortgage settlement ― a once-and-for-all agreement to put the foreclosure mess to rest. Schneiderman said the deal was no good; Obama was sweeping too much bad behavior under the rug and going too easy on the bad guys.
Then in January 2012, Schneiderman got his payoff: not a better mortgage deal but a big night in the spotlight. Obama invited Schneiderman to be a guest at the State of the Union address, where the president announced him as the leader of a new federal and state government task force prosecuting the fraud at the heart of the 2008 financial crisis.
In this role, Schneiderman issued a grand total of zero criminal subpoenas against U.S. financiers. If you want to know why nobody went to prison for wrecking the global economy in 2008, the answer, in no small part, is Schneiderman.
Monday night’s gut-wrenching expose of his history of alleged physical abuse and psychological manipulation in his romantic life is a particularly violent, misogynist rendition of the behavior he demonstrated in his professional life. He toyed with and misled the American public about his white-collar-crime work for years and generally got away with it.
Though his record against the rich and powerful is profoundly unimpressive, Schneiderman consistently scored incredible press from mainstream and liberal outlets ― nearly all of it based on bank fraud investigations that not only weren’t turning out convictions but weren’t even trying to generate prosecutions.
In 2012, The Nation hailed him as “the right man” at “the right moment,” and The American Prospect heralded him as “The Man the Banks Fear Most” in a glowing cover story. New York magazine named him a pillar of the more-liberal-than-Obama left in a gushing 2013 profile, and Politico managed to twist the fact that he never seemed to actually do anything into a virtue, describing him as a “low key” champion of “methodical, behind-the-scenes” work who showed “a lack of interest in capitalizing on the office.” After Donald Trump was elected president, New York magazine again sang Schneiderman’s praises, and Politico called him “the leader of the Trump resistance.” In fairness, Schneiderman has been just as effective against Trump as against Wall Street.
Schneiderman built this reputation by holding press conferences and inking splashy settlements with banks that added up to much less than their headlines suggested. He cut deals with JPMorgan Chase, Bank of America, Citigroup and Goldman Sachs that seemed to be worth over $41 billion to taxpayers but translated into only about $11.5 billion after various tax breaks, allowances and loopholes were considered, as David Dayen, who chronicled the entire ugly history of Schneiderman and the foreclosure fraud debacle in his book Chain of Title, explained in The New Republic. And Schneiderman proceeded to stand by as big banks racked up an astounding array of federal postcrisis regulatory violations that mysteriously never seemed to run afoul of state criminal law.
All politicians stretch the truth. Every ambitious officeholder is guilty of chasing microphones. But it was a special brand of fraud to build his career by convincing the world that he was a champion of the very cause he was working to undermine. “His hypocrisy is epic,” one of his accusers, former girlfriend Michelle Manning Barish, told The New Yorker. “He’s fooled so many people.” She was talking about his support for the Me Too movement and other feminist causes, but she might as well have been describing his bank-busting persona.
But Democrats couldn’t let themselves see the fraud for what it was. He was the top prosecutor in New York, and no bankers had gone to prison, but people still clung to the belief that he was the man the media said he was ― so much so that friends of one alleged victim of his abuse even counseled her to “keep the story to herself, arguing that Schneiderman was too valuable a politician for the Democrats to lose,” according to The New Yorker.
Schneiderman resigned Monday night, just hours after The New Yorker’s story came out. The Democratic Party didn’t lose a champion of anything.