- js reader version
- view hidden posts
- tags and related articles
by Stephen Lendman
Saturday, Feb. 11, 2012 at 12:50 AM
Duplicitous Mortgage Settlement Deal
by Stephen Lendman
What major media scoundrels call relief is, in fact, business as usual coverup and fraud. Ellen Brown's important writing explained.
Obama pushed hard to get state attorneys general to settle for a fraction of stolen wealth, but it's worse than that. More on the announced deal below.
At issue is securitized mortgage-backed securities fraud compounded by "robo-signing." it involves "employees signing names not their own, under titles they did not really have, attesting to the veracity of documents they had not really reviewed."
It wasn't occasional. It's systemic grand theft since the 1990s. As a result, settling with crooks lets Wall Street shysters "off the hook for crimes that would land the rest of us in jail - fraud, forgery, securities violations and tax evasion."
State Attorneys General Perpetuate Fraud and Coverup
Forty-nine of the 50 States AGs agreed to let five major banks off the hook - JP Morgan Chase, Bank of America, Citigroup, Wells Fargo, and Ally Financial (formerly GMAC). Oklahoma opted out, not from altruism. AG Scott Pruitt wants no banker penalties. Stealing is OK with him.
In exchange for robo-signing fraud, illegal fees, failure to honor previous settlements, and other servicer abuses, rogue bankers settled for billion. It amounts to pennies on the dollar at most.
Homeowners may sue on their own. States get a fixed amount for legal aid services. All securitization claims, tax and insurance fraud ones, and others may still be investigated and prosecuted by individual AGs and the Residential Mortgage-Backed Securities Working Group (RMBS).
Set up by Obama's Financial Fraud Task Force, New York AG Eric Schneiderman is one of five co-chairs. Delaware, Missouri, Nevada and Arizona filed lawsuits. California AG Kamala Harris retained the right of state to sue under the state's False Claims Act. Massachusetts also has a foreclosure fraud suit pending.
Funds are apportioned as follows:
• billion for troubled borrowers in the form of principal reduction credits;
• billion toward underwater borrowers' refinancing; and
• billion for cash payments to states to use for legal aid services, foreclosure mitigation programs, and fraud investigations;
In addition, Washington gets a small amount. Around 750,000 wrongfully foreclosed borrowers get checks from ,800 - ,000. It’s pennies on the value of home equity stolen. On average, borrowers are underwater by ,000 each. Collectively, their negative equity approximates 0 billion.
However, millions of underwater homeowners aren't helped, and statute of limitations absolution applies to amounts too large to ignore. Filings more than five years old are excluded, so defrauded homeowners beyond this timeline remain cheated out of luck.
Why the Deal "Stinks"
It shouldn't surprise. Deals bankers agree to helps them, not victims. On February 9, Yves Smith's Naked Capitalism article headlined, "The Top Twelve Reasons Why You Should Hate the Mortgage Settlement," saying:
Settlement terms haven't been released, but leaked details assure few troubled borrowers will be helped compared to much greater numbers left out.
State AG suits remain unresolved and won't likely yield borrower-friendly results. The Nevada/Arizona suits were "folded into" settlement terms, effectively ending them.
(1) The maximum payout per borrower is ,000. Its peanuts compared to amounts lost. It represents about 1% of loan balances. It's "less that the price of the title insurance that banks failed to get when they transferred the loans to the trust."
It's also a fraction of legal expenses for challenged foreclosures. Bankers made out like bandits in terms of benefits and avoiding prison time. Borrowers are stuck with a deal made in hell.
(2) The /26 billion "is actually billion of bank money and the rest is your money." Write-downs will be almost entirely from securitized loans. In other words, investors will eat them, not Wall Street crooks.
(3) billion apportioned among five banks is too inconsequential to matter.
(4) billion "actually makes bank second liens sounder, so this deal is a stealth bailout that strengthens bank balance sheet at the expense of" cheated borrowers.
(5) Enforcement is a "joke." In large measure, it lets banks self-supervise.
(6) Past servicer consent decrees show they "all fail to comply....(T)hey cheat in all sorts of ways to (avoid obligations and) reduce their losses."
(7) The Nevada/Arizona "cave-in" greatly helps Bank of America. It's "by far the worst offender in the chain of title disaster...."
(8) If a "serious" deal was planned, the announced result wouldn't have happened and high-level crooks wouldn't get off unscathed.
(9) Many systemic abuses were ignored, "such as servicer driven foreclosures and looting of investors' funds via impermissible and inflated charges."
(10) The deal conceals "much deeper chain of title problem(s)."
(11) Obama's foreclosure task force will be as toothless as previous efforts to address a joint Wall Street/Washington swindle.
(12) Housing market problems will keep festering. Underwater borrower suffering will continue. Mortgage-backed securities investors will "will to hung out to dry." Unresolved problems put the residential mortgage market on "long term, perhaps permanent, government life support."
The deal's another example of who always wins and loses. It also proves Washington's bipartisan criminal class hands bankers whatever they wish at the expense of ordinary people losing out entirely.
A Final Comment
Greece represents the epicenter of banker pillage. Multiple austerity rounds imposed mass unemployment, poverty, homelessness, hunger, and unprecedented human misery in a modern-day state. They also provoked mass street rage heading toward exploding in response to what people no longer will tolerate.
Homeowners can't pay new property taxes. Suicides are Europe's highest. Children faint in school from hunger. Hospital admissions rose 25%. Budgets serving them fell 40%. As a result, shortages of everything compromise care people can't afford to pay for anyway.
HIV rates rose 50%. Other illnesses are rising. A humanitarian catastrophe's unfolding. Nonetheless, ECB/IMF/EU troika pressure demands more in return for another 130 billion euro bailout to pay bankers, not use productively for growth.
The more Greece borrows, the more debt entrapped it becomes. Bankers occupy Greece. They demand their pound of flesh. They're strip-mining the nation's crown jewels and force-feeding austerity on people faced with more than they can bear.
Despite a deepening Greek tragedy, The New York Times hailed the latest deal instead of condemning it. It remains for Greece's parliament to act. Despite strikes and mass protests, expect passage to be rubber stamp.
Besides previous harsh rounds, another 22% wage cut's coming on all salaried workers. Pensions and jobs are also targeted, around 150,000 public ones by 2015. In addition, permanent state enterprise positions will be abolished.
Greece already is bankrupt. Now it's racing toward collapse. Social crisis conditions threaten to explode. It's just a matter of time.
Stephen Lendman lives in Chicago and can be reached at firstname.lastname@example.org.
Also visit his blog site at sjlendman.blogspot.com and listen to cutting-edge discussions with distinguished guests on the Progressive Radio News Hour on the Progressive Radio Network Thursdays at 10AM US Central time and Saturdays and Sundays at noon. All programs are archived for easy listening.
Report this post as:
LATEST COMMENTS ABOUT THIS ARTICLE
Listed below are the 10 latest comments of 1 posted about this article.
These comments are anonymously submitted by the website visitors.
GUIDE TO REBEL CITY LOS ANGELES AVAILABLE
lausd whistle blower
Help KCET and UCLA identify 60s-70s Chicano images
UCLA Luskin: Casting Youth Justice in a Different Light
Change Links April 2018
Nuclear Shutdown News March 2018
Join The Protest Rally in Glendale on April 10, 2018!
Join The Protest Rally in Glendale on April 10, 2018!
Spring 2018 National Immigrant Solidarity Network News Alert!
Anti-Eviction Mapping Project Shows Shocking Eviction Trends in L.A.
Steve Mnuchin video at UCLA released
Actress and Philanthropist Tanna Frederick Hosts Project Save Our Surf Beach Clean Ups
After Being Told He's 'Full of Sh*t' at School Event, Mnuchin Demands UCLA Suppress Video
Resolution of the Rent Strike in Boyle Heights
What Big Brother Knows About You and What You Can Do About It
Step Up As LAPD Chief Charlie Beck Steps Down
Our House Grief Support Center Hosts 9th Annual Run For Hope, April 29
Don’t let this LA County Probation Department overhaul proposal sit on the shelf
Echo Park Residents Sue LA Over Controversial Development
Former Signal Hill police officer pleads guilty in road-rage incident in Irvine
Calif. Police Accused of 'Collusion' With Neo-Nazis After Release of Court Documents
Center for the Study of Political Graphics exhibit on Police Abuse posters
City Agrees to Settle Lawsuit Claiming Pasadena Police Officer Had His Sister Falsely Arre
Professor's Study Highlights Health Risks of Urban Oil Drilling
Claims paid involving Pasadena Police Department 2014 to present
Pasadenans - get your license plate reader records from police
LA Times Homicide Report
More Local News...
What does the Quran Say About Islamic Dress??
Biodiversité ou la nature privatisée
The Market is a Universal Totalitarian Religion
Book Available about Hispanics and US Civil War by National Park Service
The Shortwave Report 04/20/18 Listen Globally!
The Republican 'Prolife' Party Is the Party of War, Execution, and Bear Cub Murder
Paraphysique de la dictature étatique
Book Review: "The New Bonapartists"
The West Must Take the First Steps to Russia
Théorie générale de la révolution ou hommage à feu Mikhaïl Bakounine
The Shortwave Report 04/13/18 Listen Globally!
“Lost in a Dream” Singing Competition Winner to Be Chosen on April 15 for ,000 Prize!
The World Dependent on Central Banks
Ohio Governor Race: Dennis Kucinich & Richard Cordray Run Against Mike DeWine
March 2018 Honduras Coup Again Update
Apologie du zadisme insurrectionnel
ICE contract with license plate reader company
Black Portraiture(S) IV: The Color of Silence...Cuba No...Cambridge Yes
Prohibiting Micro-Second Betting on the Exchanges
Prosecutors treat Muslims harsher than non-Muslims for the same crimes
Amy Goodman interview on cell phone safety
Mesa, Arizona police officer kills unarmed white man
Israeli leaders should be prosecuted for war crimes
Paraphysique de l'autorité
Two Podcasts on fbi corruption
Fbi assassins assault & try to kill DAVID ATKINS
More Breaking News...