Send a Tweet
Most Popular Choices
Share on Facebook 1 Share on Twitter Printer Friendly Page More Sharing
OpEdNews Op Eds    H2'ed 5/20/11

Will the NY Attorney General Bring Doomsday Charges Against Wall Street? If So, How Long Will He Survive?

By       (Page 1 of 3 pages)     (# of views)   No comments, In Series: The Money Party
Author 3863
Follow Me on Twitter     Message Michael Collins
Become a Fan
  (123 fans)
- Advertisement -

Michael Collins


(
Image by Unknown Owner)   Details   DMCA

Gretchen Morgenson of the New York Times just published one of the few feel good stories in months following the 2008 financial crisis.  She describes a possible day of reckoning for the perpetrators of the 2008 crisis and much of the pain that has followed.

The newly elected New York attorney general, Eric Schneiderman (D), wants information from Goldman Sachs, Bank of America, and Morgan Stanley.  Among other things, the information concerns mortgage pooling and bundling.  This may well include information on collateralized debt obligations (CDO's) and mortgage backed securities (MBS).  New York state officials told Morgenson:

- Advertisement -

"The New York attorney general has requested information and documents in recent weeks from three major Wall Street banks about their mortgage securities operations during the credit boom, indicating the existence of a new investigation into practices that contributed to billions in mortgage losses." New York Investigates Banks' Role in Financial Crisis New York Times, May 16

Morgenson indicated where the attorney general might be heading - securitization fraud:

"Some litigants have contended, for example, that the banks dumped loans they knew to be troubled into securities and then misled investors about the quality of those underlying mortgages when selling the investments."

- Advertisement -

"The possibility has also been raised that the banks did not disclose to mortgage insurers the risks in the instruments they were agreeing to insure against default." New York Times, May 16


In addition to the leaked investigation, Morgenson makes a critical point about ongoing federal and state attorneys  general efforts for settlement order on mortgage fraud, fictional mortgage agreement s, and matters related to ForeclosureGate.

"By opening a new inquiry into bank practices, Mr. Schneiderman has indicated his unwillingness to accept one of the settlement's terms proposed by financial institutions "" New York Times, May 16

Matt Tiabbi explained what this means:

"If the AGs were to sign off on a friendly global settlement for mortgage abuses prematurely, it would be like a DA offering a millionaire murderer a 2-year plea bargain before the cops even had a chance to interview all the eyewitnesses. It would be a blatantly political arrangement."  Matt Tiabbi, May 17

The settlements (consent orders that avoid a trial) by the Obama Department of Justice and the state attorneys general would cost the big banks and Wall Street a few billion dollars in legal fees but free them from civil suits that could stretch into the trillions and jail time for criminal fraud.

- Advertisement -

The New York AG's actions stop any settlement in its tracks since, according to Tiabbi; it takes all 50 states to generate a consent order.  Should it become official, Schneiderman's investigation would also set a high bar for any other settlements.  It could also simulate demands for serious prosecutions around the country.

Serious charges by Schneiderman would also  make a federal settlement like the one leaked to American Banker look simply awful to the public.

Nexus between Cuomo 2009 Charges against Bank of America, Schneiderman's Investigation, and the Senate Report on "Wall Street and the Financial Crisis"

On February 4, 2009, then New York Attorney General Andrew Cuomo filed a complaint against the Bank of America, Kenneth D. Lewis, and Joseph L. Price.

Next Page  1  |  2  |  3

 

- Advertisement -

Well Said 1   Valuable 1  
Rate It | View Ratings

Michael Collins Social Media Pages: Facebook page url on login Profile not filled in       Twitter page url on login Profile not filled in       Linkedin page url on login Profile not filled in       Instagram page url on login Profile not filled in

Go To Commenting
The views expressed herein are the sole responsibility of the author and do not necessarily reflect those of this website or its editors.
Follow Me on Twitter     Writers Guidelines
Contact AuthorContact Author Contact EditorContact Editor Author PageView Authors' Articles
Support OpEdNews

OpEdNews depends upon can't survive without your help.

If you value this article and the work of OpEdNews, please either Donate or Purchase a premium membership.

STAY IN THE KNOW
If you've enjoyed this, sign up for our daily or weekly newsletter to get lots of great progressive content.
Daily Weekly     OpEdNews Newsletter
Name
Email
   (Opens new browser window)
 

Most Popular Articles by this Author:     (View All Most Popular Articles by this Author)

Ukraine President Once Agent for U.S. State Department

Worst President Ever - Barack H. Obama

It's official! You're on your own

Rigged Elections for Romney?

Real Unemployment at 23% - Dampening the Excitement

Humiliation And Death As A Tool Of National Policy