Image and video hosting by TinyPic

Wednesday, August 14, 2013

As I thought...

Larry Summers almost has a lock on the Fed Chair position.
The trial balloon, it seems, has floated: Albert Hunt, today, puts Larry Summers’s chances of getting nominated as Fed Chair at 65%, saying that he has the support of just about everybody in the Obama administration not named Valerie Jarrett.
Obama continues to play the Lucy role, and we continue to be Charlie Brown. (See previous post.) Yes, I got my hopes up -- again -- when the media announced that there would be serious investigations of mortgage fraud on the part of B of A and Chase. But as Matt Taibbi notes, any actions will probably result in nothing more than fines, which the banks will simply consider the price of doing business.
But to me, these investigations will be meaningless unless one of two things happens, once they reach the inevitable stage of concluding painstakingly-crafted settlements with the inevitable teams of high-priced lawyers for the offending firms:

1) Someone goes to jail.

2) The company is ordered to break itself up into smaller pieces.

As to point one, here's the thing. If criminal laws were violated, then the government certainly has discretion to exercise mercy and seek non-criminal sanctions against the individuals responsible. But they can really only do that and not be total hypocrites if they also simultaneously implement leniency programs for ordinary street criminals at the same time.

Just yesterday, for instance, a federal judge in Mississippi handed down a six-month sentence to a man and ordered him to pay $8,282 in restitution for food stamp fraud – one Stanley Jones apparently lied in an application about whether or not anyone in his household had ever been convicted of a felony drug charge when he applied for food stamps.
Meanwhile, S.E.C. target Fab Tourre – the Goldman exec who joked about selling bad bonds to "widows and orphans" – will not do a day in jail for his part in a fraud that caused two banks in Europe to lose over a billion dollars. And Fab's restitution will range from $30,000 to $780,000, depending upon how much judge Katherine Forrest decides to ding him for each of his six counts of civil fraud.
I haven't checked recently. Is the right-wing media machine still droning on about what a socialist Barack Obama supposedly is?
An interesting aside is that property title confusion continues long after the GFC. Remember, the securitization process of mortgage backed securities (MBS) had a strict 90 day time frame for legally receiving mortgage titles from the banks into the security trust funds. In order to achieve this the originating banks had to pass both the mortgage title (property lien) and the promissory note (the loan) to the MBS funds. This could only be done under established law by registering the transfer with the relevant state and local authorities and paying stamp duty. Without that step the transfer is null and void at law. The big banks failed to do this and would have to have known as far back as 2000 that the MBS funds effectively had no legal title to the properties they had supposedly received. They were, in effect, trading worthless paper on the stock market. The MBS funds were assured by the big banks that mortgages could legally be traded with them through the banking database, Mortgage Electronic Registration Systems (MERS). The banks had to have known that this process had no legitimacy under well established property law. In other words the banks' criminality extended as far back as 2000 when they established MERS. They were punting that Bush, or whoever followed, would end up having to legitimize their antics which is what has occurred. The amount of housing money fraudulently handled in the GFC was $1.4 trillion. Now that's serious crime!

The legal title mess continues. Few of those defective mortgage transfers have been remedied so ownership continues to be clouded. Obama wants to wind down (profit-making) mortgage giants Fannie Mae and Freddie and hand the proceeds to private enterprise along with control of property title transfers. In other words, more fraud from the same fraudsters.
Post a Comment

<< Home

This page is 

powered by Blogger. 

Isn't yours?

Image and video hosting by TinyPic