"This nation's most elite bankers originated and packaged fraudulent loans that destroyed wealth"

[Better Believe It]

FDIC Called On To Put Bank Of America Into Receivership
by Dan Froomkin
October 22, 2010

Charging that the ongoing foreclosure fraud epidemic is the work of precisely the same unrepentant bank officers whose fraudulent mortgage schemes crashed the financial system in the first place, two leading critics of the financial industry are calling on the FDIC to put some of the nation's biggest banks into receivership -- starting with the Bank of America -- and make them clean house.

William K. Black, a former regulator and white-collar crime expert who cracked down on massive fraud during the savings and loan scandal of the 1980s, and his fellow economics professor at the University of Missouri-Kansas City, L. Randall Wray, write in the Huffington Post that it's time to "foreclose on the foreclosure fraudsters". They write:

The lenders, officers, and professional that directed, participated in, and profited from the fraudulent loans and securities should be prevented from causing further damage to the victims of their frauds, through fraudulent foreclosures.

They argue that, far from being a coincidence, massive foreclosure fraud "is the necessary outcome of the epidemic of mortgage fraud that began early this decade." The reason for that:

The banks that are foreclosing on fraudulently originated mortgages frequently cannot produce legitimate documents... Now, only fraud will let them take the homes. Many of the required documents do not exist, and those that do exist would provide proof of the fraud that was involved in loan origination, securitization, and marketing. This in turn would allow investors to force the banks to buy-back the fraudulent securities. In other words, to keep the investors at bay the foreclosing banks must manufacture fake documents.... Foreclosure fraud is the only thing standing between the banks and Armageddon."

So the only solution, then, is new management. "We should remove the senior leadership of the banks and replace them with experienced bankers with a reputation for integrity and competence, i.e., the honest officers that quit or were fired because they refused to engage in fraud," Black and Wray write.

Black and Wray write:

This nation's most elite bankers originated and packaged fraudulent nonprime loans that destroyed wealth -- and working class families' savings -- at a prodigious rate never seen before in the history of white-collar crime. They created the worst bubble in financial history, echo epidemics of fraud among elite professionals, loan brokers, and loan servicers, and would (if left to their own devices) have caused the Second Great Depression. Read the full article by Black and Wray at:
http://www.huffingtonpost.com/william-k-black/foreclose-on-the-foreclos_b_772434.html

The two professors call for "nothing short of removing all senior officers who directed, committed, or acquiesced in fraud."

http://www.commondreams.org/headline/2010/10/22-7

[WinkyDink]

1. The Administration isn't into "bold moves."

[Junkdrawer]

8. Understatement of the year. Black and Wray quote the administration:

...

If the government does not hold the fraudulent CEOs responsible, who is supposed to stop the epidemic of elite financial fraud? The Obama administration's answer is the fraudulent CEOs themselves, at a time of their choosing. You can't make this stuff up.

But ultimately resolving the problems is not the government's responsibility, said Michael Barr, assistant Treasury secretary for financial institutions.

"Fundamentally, this is up to the banks and the servicers to fix," he said. "They can fix it as fast as they feel like."

So who is Michael Barr and why is saying things on behalf of the Obama administration that make it appear to be a wholly-owned subsidiary of the fraudulent lenders and servicers? He's a Robert Rubin protégé and he's the senior Treasury official for banking policy.

...


The banksters can change as much as they want as fast (or slow) as they want. That's "Change I Can Believe In!" :puke:

[WillyT]

2. HUGE K & R !!!

:kick:

[kenny blankenship]

3. This country has got to take on the Banking Mafia & clean house. Tinkering at the margins is suicide

It can clean house, or it will be joining the ranks the club of corrupt and unstable states forever.

This is where corporatism wins its final triumph and succeeds in corrupting and weakening even the strongest and most legitimate of nation-states, like the federal government of the United States of America, to the point where they collapse into total dysfunction and ruin, and the idea of a government as the expression of the national will becomes permanently obsolete and ridiculous. Or else we will see corporatism finally repudiated and put down by the traditional and exclusive powers of the nation state: law and force.

[glitch]

5. Confidence in our entire political-economic system won't be restored until they do.

People can't live without that level of confidence for long, they will require real change if capitalism can't be saved by government, again.

[shraby]

4. The headline I want to read is about trials for the perps.

[scarletwoman]

6. K&R - I'm just plain sick of these crooks getting away with their shit.

They're nothing but ultra greedy con men.

[Iggo]

7. 'Destroyed wealth"? I like that.

I'm gonna use it next time I talk to the baggers I work with.