Yes, on the surface it seems like President Obama’s announcement in last week’s State of the Union speech of a new financial crimes unit means homeowners fighting the big banks’ foreclosure feeding frenzy will finally see some justice.
I hope it is so. But I have to say I’m a doubter. Why? Well, the administration’s past actions and, more notably, inactions.
For one, back in 2009 Obama created a Financial Fraud Enforcement Task Force, which has managed to do some good investigating the pooling and securitization of mortgage securities by big banks, but doesn’t seem to have been too interested in aiding consumers cheated by bogus mortgage mod claims.
No big surprise there. The administration doesn’t seem to care what happens to homeowners, as evidenced by its much-touted HAMP program that was supposed to provide $50 billion to help 4 million homeowners keep their homes.
The program is a failure and a farce because it requires that those same banks whose unmitigated greed caused the foreclosure crisis in the first place will voluntarily comply with a toothless set of guidelines to help people refinance and restructure their mortgage loans. Instead the banks deliberately lie and cheat and string people along, then swoop in and foreclose. And neither the Obama administration nor Congress nor Attorney General Eric Holder nor any of the agencies that are supposed to oversee and regulate the banking industry has done a darn thing to stop the banks or help homeowners in any real way.
None of the executives involved in predatory lending practices or shady securitization schemes has gone to trial, let alone to jail. Nobody with any power to prosecute seems to cares that banks blatantly forged untold thousands of foreclosure documents, so why would the banks stop lying to people about pretty much every aspect of the so-called “home preservation” process?
And where is the political will to go after the fat cats, especially in an election year, when Wall Street and the banking sector provide billions in campaign contributions? We live in a time when the 30 of the country’s largest corporations (including my nemesis Wells Fargo) spend more on lobbyists than they pay in taxes and 25 of the 100 highest-paid CEOs make more money than their companies pay in federal income taxes.
Much as I admire New York Attorney General Eric Schneiderman, who has been tapped to head the new financial fraud squad, I don’t think he and a small task force will make much headway against all those dollars.
And speaking of will, where has the will been for the past three years as foreclosures reached record numbers and the customers of all the big mortgage servicers complained about the remarkably similar games being played to delay and deny their requests for mortgage relief? The president didn’t mention any new laws being needed for his task force to go after financial fraud; in fact, laws already exist. They just seem to have been ignored at all levels, from AG Holder right down to municipal courts and community law enforcement.
So, I do hold out a teeny bit of hope that at least some token justice will be doled out by this task force, though I’m not as enthusiastic as Rolling Stone reporter Matt Taibbi, who gleefully predicts that if the task force is for real we could see “half the luminaries on Wall Street doing prison time.”
I’m much more confident in Florida consumer lawyer Matt Wiedner’s analysis of the reasons why Obama’s announcement is just more propaganda designed to fool average Americans into thinking they and their issues mean anything at all to our so-called democratic leaders.
“The reason is quite simple….the banks and Wall Street are throwing hundreds of millions in bribes (campaign contributions) to shut up and buy off every bit of our government.
“Our government, at all levels, is entirely captive to corporations who do not exist to serve or protect The People. They exist with one singular purpose in mind…maximize shareholder profits.
“So with that as background, I state that the President’s recently announced Financial Fraud Enforcement Task Force is nothing but theater. A farce. A cruel joke being played on Americans who think something will be done to protect them.”