It's Been A While

March 1st, 2016

The very few of you who read this know that I am not a prolific blogger. One's opinions have only so much shelf life.

What interests me more is whether what I wrote in the book and what I have written here holds up under the high beam of time. I think it does. Not a single major prosecution. not one. And now Hillary Clinton, of all hypocrites, laments the "horrors" of Wall Street. What are the odds Trump would jail his Wall Street buddies, put companies out of business? Slim and none. Sadly, the behaviors that caused the collapse of the economy are being repeated already. The housing and lending industries just won't have it any other way. The few reforms that were instituted are keeping the volumes down, but for how long? Not too long, I predict. But, hey, it's been going on for fifty years, why stop now?

To those who write self-aggrandizing Comments to these posts, please don't. You're not going to get any business that way, and all you do is screw up my inbox.

Here We Go Again! Again.

May 14th, 2014

The Obama Administration announced today a big move to lower mortgage credit standards. The excuses are the usual. Need to bolster housing, need to get people into The American Dream, etc. The real reason is the banks need the business. HUD is insured by Obama, and taxpayers can, once again, absorb whatever losses will surely follow. Its been going on forever, and now it all starts again, thanks to a corrupt Administration and an ignorant population.

Holder Lies Again, According to DOJ Inspector General

March 14th, 2014

Finally, a sense of vindication for the views expressed here over the past several years. It is a sad sense of vindication, because it means that Eric Holder, the Attorney General of the United States, and most probably, his boss, Barrack Obama,  President of the United States, have deliberately and consistently lied to the people of America. I don't like using "liar," but facts are facts.

On March 13, 2014 the Inspector General of the United States Justice Department issued a report on the performance of the DOJ in prosecuting the massive mortgage frauds of the late nineties to March, 2007, at least. Readers here know that the lack of prosecution was predicted here, and that not a single major financial institution has been even indicted, much less convicted of any crime. Readers here also know that such prosecution was indeed possible, and would have been successful.

Now, the Justice Department Inspector General reports that Eric Holder "erroneously" reported over an 80% number of prosecutions, and an inflation of over 80% of the dollar values of those prosecutions. Not only that, but after being told of the errors, the IG reports, Holder's DOJ continued to use the false statistics for nearly a whole year!

In addition, the Report states that the FBI, of which I have been very critical on mortgage fraud, became unhappy with the failure of US Attorneys to prosecute mortgage fraud, and simply let cases go. And the public wonders why nobody went to jail for the crime of the young millenium?

What is especially galling is that DOJ has repudiated and challenged its own IG's report! That Holder would direct DOJ to lie about the accuracy of its own internal probe reflects an all too prevalent willingness to govern through the BIG LIE.  And, please note, this Report does not even touch on the Wall Street packaging  of fraudulent loans; it is limited to just mortgage fraud in the mortgages which Wall Street packaged and sold.

I wish I were shocked. I'm not.

Statutes of Limitation

October 22nd, 2013

I have been quite critical of the Justice Department for its failure to bring criminal cases against Wall Street's leading financial institutions for mortgage fraud. Readers here know I have asserted that the cases can never be brought because, in most cases, the Statute of Limitations has run.   I stand by the criticism, but stand corrected as to potential claims brought under a ten year Statute that applies to crimes AGAINST, not by, financial institutions. Just this week, JP Morgan Chase agreed to a $13 billion CIVIL settlement with the Justice Department. No criminal charges yet, if ever, but large pats on the back to themselves for avoiding a public rendition of the frauds alleged against them. Under the law, the Limitations period for some financial crimes against financial institutions has been extended to 10 years. This would mean that crimes committed against non-financial institutions, such as investors, insurance companies, pension funds and the like are still barred after 5 years. There have been no major criminal cases brought against any major investment bank or commercial bank for their frauds, and unless it is alleged that one bank sold phony mortgages to another, there will be no use made of the additional 5 year Statute. It is premature to speculate that there will be no such prosecutions, but I suggest that no breath be held waiting for one. Politics and money will continue to trump justice, and there will be no deterrence against the biggest financial crooks in history.

All Too Predictable

August 27th, 2013

You may notice it has been a while since I posted. There is a reason. Rather than harp, day after day, on the perfidy of Obama and Holder, I thought it best to give them an opportunity to reverse their course and actually do something about the mortgage mess. I've waited, and it is clear that nothing has changed. In fact it is worse. The predictions here have started to come true.    A major due diligence firm has been fired by, not one, but two, major mortgage origination firms. Why? For doing their job. For refusing to backdate mortgage application documents. For refusing to forge signatures on mortgage applications .  Radio ads are now preaching the benefits of variable rate mortgages. Yes, the self same mortgages that left homeowners carrying unsustainable mortgage rates.  And, from the President we hear more "make housing affordable, simple to obtain" rhetoric. And from Holder we have an announcement that criminal investigations are winding up, that those responsible will be held accountable, and that he will leave office once the announcements are made, but he won't be following up the cases.     Even The New York Times  wondered aloud what role the Statutes of Limitation might play in a criminal case's disposition. Readers here know that most civil and virtually all criminal Statutes have run. The cynicism doled out by Obama/Holder is terrifying in its boldness. The Big Lie taken to another level.  Nobody cares about mortgage fraud until the economy is destroyed by it. Then it is forgotten, and the fraud starts all over again. Keep watching. This will not be good.                                                                                                                                                                     

Credit Rating Agency Lawsuits-The Jokes Continue

February 8th, 2013

Once again, the Obama/Holder "Justice" Department makes headlines, and pats itself on the back for bringing mortgage fraudsters "to justice." This week's announcement of a lawsuit against Standard & Poor's for knowingly defrauding investors by willfully publishing false and fraudulent positive ratings for inferior mortgage backed investments is calculated to give the impression that justice is being served, and bad guys brought to heel.

Nothing could be farther from the truth. Additional lawsuits are now contemplated against the other perps of the alleged frauds, Moody's and Fitch, and you and I are supposed to celebrate. A brief history of the greatest mass fraud in history is in order. Readers here know the story. There is no cause for celebration.

It is now just under six years from the March, 2007 public disclosure of the massive frauds that were perpetrated at every level of the mortgage industry, including the ratings agencies. The timing of the latest rounds of "lawsuits" just happens to be outside the usual range of criminal Statutes of Limitation. Coincidence? No, I don't think so. These much ballyhooed lawsuits are a mere continuation of the Obama/Holder policy to not bring criminal actions against Wall Street at any serious level. The elements of the frauds alleged against the ratings agencies are precisely the same as the elements of crimes. Only the burden of proof in a criminal case is different. Obama/Holder have made, and continue to make, a conscious effort to avoid criminal prosecution and to exact civil penalties from the perpetrators of criminal acts.

There will be a settlement of these civil lawsuits. The costs will be borne by consumers. Nobody will go to jail. And, most importantly, there will be no deterrence established.

Instead, there will be new rules and regulations, an increase in bureaucrats hired to monitor behavior, and  new chapters written on how to avoid the new rules and defeat the government bureaucracy.

The public is expected to swallow this act, this charade, and celebrate justice. In fact, the public has been cynically duped again, and the Big Lie gains ever increasing prominence.

Hipocrisy Rules

January 26th, 2013

A recent spate of articles has appeared decrying the lack of criminal prosecution of major players in Wall Street's mortgage fraud fiasco. Readers here know just how long I have been writing, and predicting, that no serious criminal prosecutions would follow the greatest frauds in history.
The hipocrisy in these recent media "disclosures" is overwhelming. While he was still Chair, I forwarded "You the Jury, How Wall Street Cashed In On the American Dream and Nearly Killed It" to Phil Angelides, and a plethora of others. As a former Federal Prosecutor of major mortgage fraud and a Wall Street insider during the run up to 2007, I expected to be called upon. Not a word. No interest in hearing from someone with inside information, and a clear and effective path to prosecution. The rhetoric today from Angelides and others is self serving nonsense. Statutes of Limitation have run. There has been, and will be, no real accountability. And, it is starting to happen all over again. Mortgage fraud is alive and well.

Now the President has appointed Mary Jo White to head the SEC. He crowed that "enforcement" is now the byword. Bull! Enforcement of what? Future crimes? Certainly Ms. White will not be "looking back," since Obama declared FOUR YEARS AGO that looking back is not the way to go. Congress needs to check Ms. White's client list. Once again the fox is in the henhouse. Obama will never enforce the law against anybody on Wall Street worth prosecuting.

And America is the worse for it.



It's Official-Crime Pays

January 7th, 2013

It's official: the Government of the United States aids, abets, condones, forgives, and derives profits from mortgage and foreclosure fraud. From the outset it was obvious that Obama/Holder were not going to prosecute anyone. The predictions were published here.  Now not even civil relief is being afforded the victims of the greatest fraud in history. This Administration is a disgrace to the rule of law.

The so-called "settlement" with major banks for mortgage fraud and foreclosure fraud announced today is an abrogation of the rule of law, a violation of the oath of any Justice Department lawyer who did not resign in protest of this travesty, and an indicator that more fraud will surely come.

Obama/Holder have permitted the major financial institutions of the world to commit crimes with impunity. In a very short time this fact will disappear into the void of public oblivion, and the big boys will be right back at it. What is not deterred becomes incentive. This is yet another sad day for the law.

As Predicted, It Starts All Over Again

December 11th, 2012

The New York Times published a story on December 9, 2012 reporting that Wall Street's biggest banks and other "Investors" are poised to sell thousands of homes in which billions have been invested through purchases of foreclosed homes. The homes were purchased, at rock bottom prices, from owners who defaulted on their loans and lost their houses. Enough time has gone by, it seems, for those who caused the housing crash and the destruction of the economy to double dip and now profit again from their criminal acts.

Readers here know that there has been no significant or material criminal prosecution of any major player for mortgage fraud. Wall Street's conduct from 1999-2007 has been glossed over, civil fines paid, individuals left unscathed, and inventory accumulated for resale. The profits derived from the original fraud have been used to pay off the SEC and the Justice Department by way of wrist slap fines, while remaining profits, after distribution to the big boys, have been poured into purchasing foreclosed properties.

Now comes the big payoff. Who will buy the foreclosed properties? How much will they pay? How will they be financed? The speculators are arranging for the next round of mortgage fraud. In this economy, with current unemployment levels, and with income at near record lows, the only possibility is that mortgages will, once again, be given to unqualified buyers. These buyers will pay up front fees. Commissions will be paid up front. Insurance policies will be issued. All of the evils of the mortgage banking system will be repeated. The speculators will reap billions in profit, pocket the money, and walk away as their buyers struggle to make their payments and, ultimately, lose their homes again.

Once the spigot opens, all the high sounding Regulation in the world will not prevent fraud in the mortgage industry. There has been no deterrence against fraud in the past, so why would the purveyors of hope be afraid their practices will be subject to any greater scrutiny than in the recent past? It is only a matter of time. It's been going on for nearly fifty years, we have learned nothing, and it's about to happen all over again.

NY Attorney General Lawsuit-Lipstick On a Pig

October 3rd, 2012
Readers need and deserve to know the truth behind the announcement of a mortgage fraud lawsuit against Bear Stearns and JP Morgan Chase. This is not, as claimed, any sort of "holding accountable." Wall Street has been allowed to escape any real accountability for the mortgage fraud that caused the housing collapse. There has not been a SINGLE criminal case brought against any major individual or financial institution. There has not been a SINGLE announced Grand Jury investigation. There have been "task forces" which have prosecuted low end fraudsters, but no political will to prosecute the higher ups who created and directed massive fraud. To assert that suing the buyer of a bankrupt company for fraud is meaningful accountability is, itself, a fraud.



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