States Steal Homeowner Relief Funds

If you thought your state attorney general was out there fighting for homeowners wrongfully foreclosed on by banks using forged documents, you might be sorely disappointed to find out where the funds from the recent robo-signing settlement will end up.

Big surprise (not!) the governments of nearly half the states involved in the settlement will be diverting at least part of their share of the $25 million to their general funds to make up general budget shortfalls. That means defrauded former homeowners won’t likely see even the meager payouts they were supposed to receive in restitution for having their homes stolen from them by mortgage servicing banks that blatantly fabricated foreclosure paperwork.

Of course, my state (Arizona) is one whose governor couldn’t give a flip about people losing their homes or banks committing outright fraud. So, in one of the states consistently in the top three hit hardest by the foreclosure crisis, money earmarked to help homeowners likely will be diverted elsewhere.

“Tom Horne, the Republican attorney general of Arizona, said he disagreed with the state’s move to take about half its $97 million, which officials initially said was needed for prisons.

But Mr. Horne said he would not oppose the shift because the governor and the Legislature had authority over budgetary matters. The Arizona Center for Law in the Public Interest has said it will sue to stop Mr. Horne from transferring the money.” ~Shaila Dewan

Thanks Gov. Brewer, her pet AG Tom Horne and the clueless state legislature for hanging Arizona homeowners out to dry yet again.  Nice to know our elected officials care so much about people losing their homes in the state ranked first in foreclosures in the nation in March 2012. Nor is the state doing much good with its Hardest Hit Fund dollars, that were supposed to help 4,000 homeowners facing foreclosure.

Better check to see whether your state is one of the 22 that will be diverting money away from programs to help homeowners struggling with underwater mortgages and fighting foreclosure-hungry mortgage servicers? (Read the full report on the state’s planned use for the settlement funds from Enterprise Community Partners, a national affordable housing group.)

Not much recourse for the former homeowners who were once again screwed by the big banks in collusion with government officials who are supposed to look out for interests of the average citizen. Just be sure to vote against those officials the next time they’re up for election: every attorney general who approved a deal that allowed this type of diversion of funds, every governor who decided to do it and every legislator who lent his or her support.

Protesters in California staged a rally to protest the hundreds of millions of dollars being diverted from struggling homeowners and in Arizona, another state hit hardest by foreclosure, Arizona Rep. Raul Grijalva (D) said, “Working families were given the short end of the stick, and now Gov. Brewer and the Legislature won’t even let them have that. This decision takes away the one chance Arizonans had to get some help navigating the banking bureaucracy that greased the skids on millions of foreclosures. It’s a clear statement of principles, that’s for sure.”                  ~Richard Zombeck

Here’s hoping an Arizona lawsuit regarding redirection of the funds succeeds and creates precedent so other states will be forced to invest in their residents trying against the odds to save their homes from foreclosure predators. And that a few more Arizonans and citizens of other settlement states take notice and speak out.

Update 8/10/12: Perhaps Florida homeowners might sometime soonish get some assistance. Or not.
Cautious optimism over foreclosure deal funds

Is Wells Fargo a Murdering Psychopath?

“Do these corporations ever show any remorse for the damage they cause? Did Wells Fargo think twice about how they’d  handle their next foreclosure victim after Norman Rousseau blew his head off?

As far as we can tell, the answer is “no,” at least not as long as the profits keep rolling in. This is genuinely psychopathic behavior. “

My deepest sympathies to the family of Mr. Rousseau and to all who have suffered dire personal losses at the hands of the banksters. And good luck to Mrs. Rousseau in her lawsuit against Wells Fargo. Hell hath no fury like a woman who has nothing left to lose.

What Does the Chase “Hedge” Loss Tell Us About Financial Regulation Reform?

Interesting NPR piece on the way Wall Street and the big banks are continuing to put short-term profits ahead of the long-term health of the economy by fighting regulation of their business.

Elizabeth Warren: “Well, the key on Glass-Steagall is that it makes banking boring. It says if you want to do all those exciting things, like take $100 billion bets or lose $2 billion or maybe three, you need to do that over in the Wall Street trading kind of business, not in a basic commercial bank that takes deposits and, you know, checking accounts and savings accounts. Glass-Steagall says there needs to be a wall between those two kinds of activities.

Congress, I hope, sees the writing here and says it’s not going to work to let the biggest financial institutions just go out and do what they want. We can’t turn these guys loose.”

I suspect the only writing Congress sees is the banksters’ signatures on big, fat campaign contribution checks. After all, it has been Congress, at the behest of Wall Street’s Lobbying millions, that has systematically dismantled banking regulation.

And, by the by, when is a hedge not really a hedge?

Update 6/7/12: Chase’s Jamie Dimon leads the charge against bank regulation.

 

 

The Banksters Swagger, Hijack Democracy

Why is the banking industry running roughshod over Americans? Why should you stop supporting these big banks by taking your money elsewhere? Listen to this episode of the Diane Rehm show and you’ll get some good information about how the banks have bought our so-called democracy and systematically shut out the voices of the many to give them free rein to make billions.

Diane Rehm: So … Wall Street has government by the scruff of its neck?

Gretchen Morgenson: Well, Wall Street is in a very powerful position and this is quite mysterious to me because they helped us into the biggest recession and the biggest economic crisis since the Great Depression. And I truly would have thought that they would have been a little bit more subdued about their attempts to manipulate the regulation that would be a normal outcome of the crisis. They haven’t. They have been aggressive. They have been absolutely swaggering around Washington and I think it points to an enormous problem with the disfunction of Washington today. People like you and me, we do not have a voice in Washington. People on Wall Street have a very loud voice and they have a very loud megaphone.