“If governing body does not care, then free-for-all.” For decades, a niche banking system grew around the ‘well-connected’ taxi industry-- with half a dozen nonprofit credit unions specializing in medallion loans. By 2004 bank examiners wrote warnings about risky practices ib interest-only loans.As lenders wrote increasingly risky loans, medallion prices neared $500,000 in 2006.to $600,000/20o8; and $800,000/ 2011, and as high as one million Three of four cabbies refinanced their original loans under far riskier terms that left them in heavy debt." . The NCUA wrote a paper on the RISKS! Including refinancings of old loans and extensions required by banks, medallion owners signed at least 10,000 loans in that time.The failure of the credit unions cost the national credit union insurance fund more than $750 million, which will hurt all credit union members. "
At www.nytimes.com
