We complain and complain but now here is something we can actually do.
It just broke in Monday's NY Times that NY Attorney General Eric Schneiderman said "not so fast" as the Obama Administration sought to whitewash mortgage fraud, pushing for a settlement that includes fines but no fraud or criminal investigations for the major banks who intentionally sold toxic securities and "robosigned" foreclosures.
AG Schneiderman is doing his job, exploring whether some people might need to go to jail for fraud in lending, securitization practices, foreclosure documents or home seizures.
White House pressure NOT to do this has been coming through Treasury Secretary Tim Geithner, HUD secretary Shaun Donovan and Eric Holder's DOJ, according to the Times, to settle because the poor homeowners need the money fast. In fact, the settlement puts $8B towards over $170B in underwater mortgages to buy get-out-of-jail-free cards for everyone involved. Industry watchers told Huffington Post the payment should be more like $20B or $30B plus structural changes.
Ironically, it was HUD, under Donovan that concluded audits in May showing the lenders violated the False Claims Act, defrauding US taxpayers as well. They referred criminal charges to the DOJ - so why are HUD and the DOJ rushing to make it all go away?
By contrast, New York elected a responsible Attorney General last fall, who has received due praise from progressive groups around the state for bold stances on hydrofracking safety and finance industry corruption.
His job is to investigate and prosecute crimes, but unlike the other Eric, Attorney General Holder, New York does not want to "look forward" in complete blindness - we have learned from the Bush years that we cannot fine our way into better behavior, only jail time seems to work.
Obama should be called out when he "buys in" to crimes and frauds by settling for negotiated fines - or worse still, allows homeowners to be used as hostages for banks to agree to loan modifications or "haircuts".
Indeed, this is only laundering billions that were obtained criminally and is another example of how Obama did not "change" Bush policies. The Bush Administration settled a major international bribery scandal with Halliburton/KBR by accepting a staggering $579 million through a Foreign Corrupt Trade Practices "pay off".
This not only took former CEO Dick Cheney off the hook in the US, it bought top-level diplomatic support for quashing the indictments in Nigeria and Europe, dispatching none other than George H.W. Bush and his former Secretary of State James Baker to pressure foreign officials to drop all charges - and magically, the story never hit the major networks.
Doomed to repeat history, we now see Obama following suit, securing "understandings" between financial giants Bank of America Corp., JPMorgan Chase & Co., Citigroup Inc., Wells Fargo & Co. and Ally Financial Inc. and the accused fraudsters at Bank of New York Mellon who knowingly sold time-bomb mortgage securities containing fraudulent sub-prime dogmeat acquired from Countrywide.
This comes just as campaign donation season is coming into bloom, and as Bank of America staff was reported to have been overheard whispering sweet nothings into Rick Perry's ear.
If you are seeking justice against the banks that caused the US economy to collapse, send Schneiderman a note now. If you are a fiscal conservative or even a tea party supporter, tell the banks they cannot use tax money in bailouts anymore - it's time to show personal responsibility.
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