The excuses given for rampant, systemic, illegal foreclosure activity by banks is the overwhelming volume the local offices have to deal with.

In housing disaster regions like South Florida or Vegas, that nonsense excuse at least has a basis in fact. The reality is the mass volume of foreclosures act to reveal the flaws in the banks processing systems. If they engage in small illegalities in New Hampshire, for instance, its doubtful anyone would notice.

Hence, the assembly line perjury the banks have committed are harder to hide in mass foreclosure venues. Which is what makes this touching Christmas Eve story all the more peculiar:

“In one of the more bizarre foreclosure cases, Bank of America is threatening to throw a West Hartford family out of their home even though the couple never missed a mortgage payment.

The largest bank in the United States earlier this month notified Shock Baitch and his wife Lisa (Friedman) Baitch that foreclosure action will start today – Christmas eve – unless the couple agrees to put their home up for a forced sale.

Why? Because another unit of Bank of America erroneously reported to credit agencies that the family was seeking a loan modification, ruining their credit rating and as the result putting their mortgage into default.

All this is happening even though the bank – after admitting it erred and sent a letter of apology in September – handed this case to a special unit at Bank of America that is charged with dealing with severe customer issues. It promised to notify the credit reporting agencies that the couple were not deadbeats, but were good credit risks”

Post bailout, the giant banks have become too large to manage themselves. It is not just housing sh%$ holes like South Florida where the banks are paperwork disasters, but apparently states such as Connecticut, also.

How else can BoA threaten foreclosure proceeding with on a house that never missed a mortgage payment; indeed, the owners were NEVER late on any mortgage payments! There was never a risk of default, or delinquency. And yet, BoA is automatically generating foreclosure notices (which no one at BOA can figure out how or why).

The obvious answer is the illegal processing of foreclosures. When lawyers, bank executives and there outside contractors are paid to violate the law, the local State Attorney General needs to prosecute these felons. Where Lawyers perjure themselves, swearing they have verified, reviewed and confirmed foreclosure files they never so much have looked at, they need to be disbarred.

Its called the rule of law, and its long past time we actually enforced it.

>

Source:
Bank Of America’s Christmas present: Foreclose Even Though Not A Payment Missed
George Gombossy
CT watchdog, Dec 24, 2010
http://ctwatchdog.com/2010/12/24/bank-of-americas-christmas-present-foreclose-even-though-not-a-payment-missed

Category: Foreclosures

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

55 Responses to “Impossible Foreclosure: Never Late on a Payment

  1. Winston says:

    Curious thing. If we were to see as vigorous pursuit of banksters in matters like this as we have seen in pursuit of Julian Assange – I’l bet you ten bucks this shit would stop.

  2. Pietro_F says:

    Interesting how the solution during depths of ’08 crisis was to consolidate for immediate survival, but the long run impact has been even more unwieldy banks than we had in the first place.

  3. ByteMe says:

    @Winston: I think it’s a lovely idea to bring the bankers up on rape charges. Very fitting to the crimes committed.

  4. curbyourrisk says:

    You do understand that the rule of law does not mean the same to everyone? We are the little people. We are only required to act accordingly to the rule of law or face imprisonment. The banks and corproations are above the law, but just below the Congressmen and women when it comes to outright law breaking.

    I am embarassed by the way the justice system has treated Martin Armstrong. I honestly can;t wait til enough people are fed up with this Government. What really sickens me…..BY DEFINITON….Thomas Jefferson, George Washinton and Benjamin Franklin are now considered Domestic Terrorists. We should emulate these people.

  5. machinehead says:

    B of A is simply out of control. I disputed a credit card balance with them in writing, following the procedures laid down in federal law. I sent a total of four dispute letters, the last two certified/return receipt, directly to the corporate law department. To my astonishment, none of them were ever answered.

    B of A don’t do paperwork — too complicated; too difficult. Too hard to find literate workers willing to toil for peanuts under the lash of oblivious bankster martinets.

    Naturally I went on payment strike, as I was legally entitled to do. After about a year of stonewalling B of A’s collectors (‘Just answer my letter! Just answer my goddamned letter!’), I finally settled with them for 70 cents on the dollar, nicking the feckless usurer for a cool three grand.

    This retarded dinosaur with the pea-sized cranial cavity is braindead stupid. Maximum aggression is the only effective policy. Drive a railroad spike through your caveman’s club, and pound its armored skull till it cracks.

  6. BusSchDean says:

    Yet more fodder for teaching how-not-to-do-business to business students. Unfortunately I am not sure they will believe it even if my faculty tell them. One would think NO business could operate like this.

    My son, a comp sci grad student with years of actual experience hypothesizes that the person(s) who wrote the software to identify and generate these foreclosure notifications is long gone — one of thousands sent out the door as excess baggage. So much for retaining core competencies and institutional knowledge.

  7. Winston says:

    @ByteMe:

    Good one!

    Not to spoil a good joke, I was thinking along the lines of taking away the livelihoods of those involved by so many means such as prison, disbarment (as Mr. Ritholtz asserts), loss of a business license, etc.

    We read about these scenarios almost every single day then it makes me wonder how many of these absurdly criminal cases we do not hear about.

  8. carleric says:

    Where are the punishers and enforcers? Oh yes that is right…feeding at the same slop trough as the banks…until (and if ever) there are perp walks and actions are not excused by “clerical error” it will never end. Are really bad managment skills felonious acts? They certainly should be.

  9. franklin411 says:

    Yes, BofA is essentially Satan in corporate form.

    I have an Amex card from them (which I only keep because they took over the bank that had originally issued the card, and it’s the longest-running line of credit I have on my credit report). 3 years ago they up and decided, all on their own, that I was the same person as some guy with the same first and last name as me. They reported this as a fact to the credit agencies and changed my mailing address on the account, all on their own, so this guy was getting my credit card statements.

    I rarely used the card but finally noticed that I hadn’t received a statement after 2 months. After I found out what they had done (amazingly, a very helpful operator at Equifax told me that BofA was the source of the problem), I did a little research on the other guy. He’s 30 years older than I am. He lives 2000 miles away. He has an entirely different DOB than I do. He has an entirely different SSN than I do. He has a different middle name.

    1 year after I got that fixed, BofA charged me a late fee on my payment. I insisted that I had paid on time, and they called me a dirty liar but said they’d reverse the fee as a “customer service measure.”

    1 week later I got an automated phone message. BofA had “forgotten” to open a bag of mail from the USPS…they had my payment and the payments of 20,000 customers all along.

    How nice!

  10. Too big to fail = too big to go to jail.

  11. super_trooper says:

    @franklin411, vote with your feet.
    BoA bought my home mortage so I have no choice but to deal with them. Every month I walk in to their office and pay them in coins. Adds up to about 10lbs in coins every month.

  12. Transor Z says:

    Heh, and I would guess that BoA didn’t settle promptly so the Baitch’s attorney went to the press. The whole Christmas angle is sweet. Nicely played, BoA legal, nicely played. Morons.

  13. Sechel says:

    B.R.
    What bothers me just as much are the WSJ stories minimizing the legality issue and playing up how not flushing the foreclosure pipline is harmful to the banks and the economy. How much of this response is from the banks deciding to spend the money on p.r. instead of fixing the real problem and how much of this Rupert just promoting his philosophy?

  14. northendmatt says:

    The giant banks were too large to manage themselves even before the bailout; fraudclosure has simply made that more abundantly apparent. Citigroup, for example, was already an assemblage of parts that didn’t make sense, had incompatible IT platforms, etc – a Frankenbank, if you will. At some point, economies of scale turn into diseconomies of scale. I’m not quite sure where that point is, but it is obvious that Citi, BoA, JPM, etc are well beyond it.

  15. KentWillard says:

    This is incompetence, not malice. And I’m sure BofA executives have been pushing to correct this immediately because it creates a lot of bad press, bad politics, and (yes) legal liability. This family will never lose their house – though they will undoubtedly waste time and energy. It is horrible, and it shows operational risk at banks. But it doesn’t have anything to do with their much bigger credit risk or market risk.

    Banks successfully lobby for lower taxes, capital, and regulation while you rant about a symbolic idiosyncracy. Look at the “Big Picture”.

  16. Sechel says:

    The regulators are part of the problem here too. They view regulating the banks(i.e. enforcing the laws,protecting the consumer) as contrary to their mission of ensuring the health and viability of the banking system. The Fed & The OCC are worst at this, and little better at the seemingly dismanted OTS.
    Only the FDIC seems to get this a little.

  17. CB says:

    @super_trooper
    I got a fun mental image of you rolling in and dumping a wheelbarrow load of pennies on the lobby floor and saying: here’s my mortgage payment a**holes – now get on your knees to collect it!

    This system of corporatocracy has failed our society miserably. A nation of laws? The black market is more honest, transparent and efficient.

  18. Petey Wheatstraw says:

    We are ruled by a Corporatocracy. Evidence of criminality by corporations won’t change anything. Complaining on blogs won’t change anything. The only way to get our government back is to take it back. Passive resistance, en masse, is the way to go (otherwise, the post-9/11 laws allowing the imprisonment of the citizenry without charge or trial, under the catch-all rubric of anti-terrorism, will be used to detain any citizen or relatively small group of citizens acting to restore our legitimate, constitutional form of government). I don’t think the American people have the stones or the intellectual or moral depth to challenge the de facto government (the FL citizenry’s election of the corporatist criminal Rick Scott, and recall of Alan Grayson — ostensibly the nation’s leader in trying to stop the abuse of his constituents and other Americans, similarly situated — serves as evidence of just how ignorant and easily manipulated we have become).

  19. Petey Wheatstraw says:

    KentWillard:

    Yours might be the most myopic comment ever posted at TBP. At a minimum, it’s criminal negligence (on top of a mountain of criminal fraud). Operational risk at banks? More like a real-world demonstration of the result of deregulating those who, once deregulated, have the power to usurp our legitimate government.

  20. Where Lawyers perjure themselves, swearing they have verified, reviewed and confirmed foreclosure files they never so much have looked at, they need to be disbarred.

    But won’t you guys runs out of lawyers? How will America ever keep up with the demand?

  21. rktbrkr says:

    Didn’t BOA announce they had completed a review of their FC system and found the system was sound? Maybe their review wasn’t sound, robo review of robo foreclosures. Robobank of America

  22. Andy T says:

    KentWillard@10.50AM

    Spot on commentary there. Well stated.

  23. Henk says:

    One of my problems with the Obama administration is that they are doing absolutely NOTHING about this. He’s supposed to be a Democrat, we are supposed to stand up for people who are being wronged by large corporations, yet, here we are two years into well documented fraud by these Banksters, and Obama hasn’t even mentioned it. It is sickening.

  24. When lawyers, bank executives and their outside contractors are paid to violate the law, the local State Attorney General needs to prosecute these felons. Where Lawyers perjure themselves, swearing they have verified, reviewed and confirmed foreclosure files they never so much have looked at, they need to be disbarred.

    I agree with and like what Barry says. I’m not a lawyer but work with lawyers on a daily basis. While lawyers have an ethical obligation to ‘zealously’ protect their clients’ interest they are simultaneously bound by a much higher ethical obligation to ‘zealously’ preserve and observe the rule of law. Perhaps the most important role performed by lawyers in a free society is to bluntly tell their clients: you can’t do that because it is against the law. Or, in an appeal to pure self-interest: you can’t do this because I could get disbarred for it. Once this ethical obligation is deemed antiquated and the participating lawyers have no fear of sanction, you get c. 1970s Zaire and Mobutu-styled kleptocracy.

  25. franklin411 says:

    @supertrooper
    Nice! Hehe! Well, I almost never use my BofA amex…I wanted to cancel it, but then I checked my credit score and it’s something like 740. I have to think that my lengthy credit history on that card (15 years) is helping me a lot. I recently applied for a new AMEX (AMEX Platinum) because it has a lot of travel benefits and the first year’s $450 annual fee is free. My thinking was that A. They would never approve me, and B. Even if they did, I can enjoy it for one year and then reassess.

    Instantly approved!

    I was honest on the application. I listed my occupation as “unemployed,” and my income as $14,000/yr. Now I grant you that $14,000 is slightly over the Federal poverty level, but still!

    So much for the banking industry’s sop that credit cards would be impossible to get after the reform law went into effect!

  26. [...] At this point, they're basically throwing darts at a map and foreclosing at will.  (TBP) [...]

  27. Jack Damn says:

    And also…

    - Foreclosure Inventory Rising for 5th Straight Month, Nearly 2.2 Million Loans are 90 days+ Delinquent Not Yet in Foreclosure
    - http://globaleconomicanalysis.blogspot.com/2010/12/lps-mortgage-monitor-foreclosure.html

    The November Mortgage Monitor report released by Lender Processing Services, Inc. (LPS) shows that the volume of loans moving to REO continued to drop as moratoria further delayed foreclosure sales. While the 90+ delinquency category has steadily declined, the number of loans moving to seriously delinquent status beyond 90 days far outpaced the number of foreclosure starts. Nearly 2.2 million loans are 90 days or more delinquent but not yet in foreclosure.

    Foreclosure inventories also continued to rise for the fifth straight month as delinquent accounts are referred for foreclosure, but the sale of foreclosure properties continued to decline. When compared to January 2008 levels, the foreclosure inventory of Jumbo Prime loans is nearly seven times higher; the inventory of Agency Prime loans is nearly six times higher; and the foreclosure inventory of Option ARM loans is approaching five times the inventory in January 2008.

    The report also shows that one-third of loans that are 90 days or more delinquent have not made a payment in a year; however, the number of new problem loans declined nearly 5.4 percent from October, which is opposite of the seasonality trend that typically impacts new delinquencies this time of year. Self-cures for loans one to two months delinquent increased in November to a six-month high.

    In the month of November, 261,153 loans were referred to foreclosure, which represents a 0.7% month-over-month decline. The total number of delinquent loans is nearly 2.1 times historical averages – and foreclosure inventory is currently at 7.7 times historical averages.

    (Source (PDF file)

  28. Ltdata says:

    Here are some other comments on foreclosure (and I don’t disagree with BR or most of the posts on this matter).

    BOA sounds like a bureaucracy in action, albeit a bad one: USA Today, 12/27 BOA rates poorly among mortgage servicers; Endless stream of class actions against BOA foreclosures (Courthouse news service, 12/27). Also, Where things stand, Paperwork foreclosure scandal (per TPM, and Propublica, 12/27)
    http://tpmlivewire.talkingpointsmemo.com/2010/12/where-things-stand-foreclosure-paperwork-scandal.php

    TPM above mentions procedural mistakes, quick settlement unlikely, F&F update and more.

    @franklin411 – I read that bank’s overall credit card fees were being cut, and they are desperate for revenue, so your story does not surprise me.

    So it’s all happening, it’s just not going to happen overnight. Let me take a guess that the big banks never figured on being on this position (& no, that’s not an excuse). Now that they are, they are or will be forced to throw additional money down a black hole where they’re already losing money on foreclosures (before fees I mean, or whatever fees the court allows). You can be certain they are very profit oriented normally, and they will try to cut their losses any way possible. After they have their losses there are court issues, etc. to clear up. That’s my take on it.

  29. S Brennan says:

    Barry even if they had asked for a home mod would that justify what happened?

    Should going to your bank during the biggest financial meltdown in 90 years and asking for some temporary relief be the signal for the financial vultures to swoop in. Is this sociopathic reaction good for our society? Doesn’t it make Obama’s HAMP a lie too obvious to ignore?

    Welcome to Pottersville, formerly known as the US of A. While we have been on the road to perdition for a while, but the Bush/Obama year would disgrace a banana republic.

  30. Petey Wheatstraw says:

    franklin411:

    I think we’ll find that the increase in consumer spending this holiday season will eventually be added to the bad/uncollectible debt column. The gift(s) that keep on taking.

  31. readerOfTeaLeaves says:

    I think BusSchDean makes an excellent point; the guys (and they were most likely ‘guys’ not gals) who wrote the original code may well be long gone.

    Without more legal prosecutions and restitution, I don’t see the economy recovering. Ever.
    Economies are built on trust; that can only be rebuilt by some kind of accountability. So far, we’ve had none; consequently, my personal view is that 96% of the chatter about ‘recovery’ is mostly bluster.

    Which brings me back to BusSchDean’s point: assuming that a lot of coders were laid off, shouldn’t the DoJ, or state AGs be able to hire some of that talent to go through the code and find the odd bits? If anyone should be able to unravel that code, it ought to be the guys who wrote it.

  32. blueveiner says:

    I hate BofA as much as anyone, and did my part by getting a 30 yr fixed mortgage from these clowns at a rate that no other banks would offer on even an adjustable product.

    That said, I continue to struggle with examples such as the Baitch situation described in this post. Read the article and you will find this quote:
    “I cannot meet the minimum payments now on the credit cards and may have to default. I am in a situation that I should have never been in since [the bank] destroyed our credit and ability to refinance. All our debt should have been consolidated and I should have positive cash flow monthly not negative.”

    This family was already in an assets and income mismatch with its liabilities and ongoing expenses. The creditors were doing what they should have done previously- correctly recognize a risk and respond accordingly. I am also thinking that the original article doesn’t present all of the facts. The posts on this site suggest that the majority of foreclosure proceedings are against people with liquid assets equal to 2x their debts and credit scores above 800. These kinds of inaccurate conclusions draw attention from the real problem(s).

    KentWillard has it “right”. This is one more example of institutionalized incompetence in the category of risk management, which enables senior executives to enrich themselves from what would otherwise be criminal behavior/negligence. True for traditional banks, I-banks, the mutual fund complex, government, etc.

  33. not-affiliated-with-Wall Street says:

    Can anyone here name the US Attorney General in less than 10 seconds?

    No, it’s not the Invisible Man.

    B of A is running roughshod across the US and what is the Justice Department doing?

    Hint: Rhymes with Erica Cantor.

  34. DeDude says:

    Anybody who does any kind of business with these TBTF monsters deserves whatever bad things happen to them. Starve the Beasts –use your local banks and credit unions.

  35. ZackAttack says:

    > Can anyone here name the US Attorney General in less than 10 seconds?

    All I can remember is that he goes by his middle name – Place.

    Slightly tangential: It is good to know that in this, the best of all possible worlds, we can all rest assured that such a competent and efficient organization as BAC is absolutely certain to have conveyed the note properly to the various REMICs, and that there’s no possibility the same mortgage could’ve been securitized multiple times.

  36. Sechel says:

    I knew Eric Holder, but don’t recal his middle name ever being used.
    That said, I can’t recall one positive thing he’s done.

  37. Transor Z says:

    I also think this more likely incompetence rather than malice on the part of BoA. But it’s also our system shaking things out and in the process the banks shouldn’t be shielded from liability or public ridicule.

    There has been damage done to public perception of banks’ honesty/ethics:

    “[B]ankers, whose ratings tumbled last year from 35% to 23% in the midst of the financial crisis, and fell further this year to a new low of 19%. As recently as 2005, 41% of Americans gave bankers high honesty and ethics ratings.” (From Gallup Honesty/Ethics poll results, Dec. 9, 2009)

    http://www.gallup.com/poll/124628/Clergy-Bankers-New-Lows-Honesty-Ethics-Ratings.aspx?CSTS=addthis

    Bankers improved this year by 4% back to 23%.

    http://www.gallup.com/poll/145043/Nurses-Top-Honesty-Ethics-List-11-Year.aspx

  38. louis says:

    Like Petey said, It’s YOUR Govt. Can you put aside all the gadgets and goodies their credit cards buy you to fight for it?

  39. Eric Holder recently sued BP for the oil spill. That’s something. But was hardly necessary, except as a PR move. BP would probably have just thrown him the keys if he’d have asked.

    But all this indignant ranting over violating the rule of law. The rule of law is whatever the rulers say it is. Always has been. Always will be. Grow up.

  40. hammerandtong2001 says:

    TBTM

    Too big to manage.

    I hadn’t thought of that until this post and this story, though I’m sure it’s been mentioned before and others have probably posted it — even right here.

    I agree with the posters who believe the bank acted incompetently, not maliciously, and screwed up a simple request from a reasonably good “customer”.

    But I do believe that the 5 largest US banks have become so big that they are nearly impossible to manage well and effectively. My own experience with a TBTF bank confirms this view, and I told that story a while back. And becuase these institutions are ineffectively managed, they do not serve their intended business or societal goals. What good does B of A do American consumers today? How about JPM?

    Banks are cursed out in every conversation I’ve been in whenever it comes up. This is a fairly new phenomenon, in my view. People hate banks — at least a lot more than they used to. And banker’s behavior during a financial meltdown which they, themselves, ushered in is a primary reason why.

    Paying themselves $millions while robosigning mortgage foreclosures.

    There will be a movie!

    .

    .

  41. bear_in_mind says:

    This should be Exhibit A in the annals of “Too Big Too Exist.” The breadth and frequency of these abominations resolutely demonstrate a system devoid of rationality, reason or accountability.

    Others have attested how property with a spotless payment record has seen the lender/servicer spring into foreclosure action over the discovery of a utility or property tax lien of less than $500. Here’s what fries me: the banks have resources and processes to keep track of this type of intricate, granular detail on the borrower — but they can not/will not respond faithfully when borrower attempts to resolve these discrepancies?!

    I have been involved on helping a number of seniors retain their homes from confiscation through foreclosure/trustee sales over these minor mortgage contract ‘violations’. Often, the borrower first learns the lender/servicer has an issue when they inexplicably stop accepting mortgage payments. Even when borrowers receive correspondence from the lender/servicer, the language is typically so inscrutable that they cannot discern either cause or resolution.

    This issue is one that those of you with older relatives ought to be paying special attention… especially if they’ve taken out HELOC’s or reverse mortgages. Depending on how deplorably the contract was written (to benefit the financial institution), a senior with a reverse mortgage who incurs a lien may have no other recourse than to sell the property to satisfy the contract. Not only do they lose their residence, their equity is DEVOURED by exorbitant fees and interest rates, leaving them with very little (if any) post-sale gain.

    Wonder if UMKC Professor William Black would be willing to be deputized and ride back into Washington to clean up this cesspool?

  42. S Brennan says:

    To the comment on Eric Holder,

    I believe the man only works on political prosecutions of people who are on the outs with the beltway bubble boys.

  43. bergsten says:

    “Incompetence or Malice”?

    Just had an evil idea — it’s an idea that’s right up there with whoever invented salary “withholding.” It would be culture-changing.

    It works like this:

    You’re paying your mortgage. You find out it’s legally and ethically possible to lower your payments. You contact the bank to do so.

    They “ruin” your credit rating. They do it in such an egregious way, that it is publicized, for free, by the sensationalist press.

    Everyone is outraged.

    For a day or so (did they ever find the parrot, by the way?).

    The bank is happy. Corporations are happy. Commerce is happy. The government is happy.

    Why?

    Because the precedent has been set to extort consumers out of ever paying anything less than “list price.”

    So, jump ahead a year or two, and you go into the car dealership to buy a new car. Make a lower-than-list offer? Get your credit smashed (“there must be something wrong with you — you obviously can’t afford to pay list”).

    Don’t know about the rest of you, but I’m putting in for a transfer to another planet. This one is doomed.

  44. Jojo says:

    So how many are closing your BoFA accounts in protest?

  45. cyaker says:

    This is getting scary. It’s time to take to the streets (after Bloomberg clears them) and peacefully demand that Obama bring Bill Black back and give him the keys to Treasury and Justice.

  46. bman says:

    Why are you up in arms about the lawyers? Why not hold the agencies responsible to the fire? Yes the lawyers signed sworn affidavits, that’s their job, that’s what they are paid for. If you’re going to get up in arms about an apparent conflict of interest and people being people, you really do have to follow the chain of direction. I personally do not think much of a law degree, but that is my personal opinion. I definately think less of a business degree these days. So who paid these lawyers to do this? they are the culpable ones. oh, those are the same guys who got the multimillion dollar bonuses to drive their companies into the ditch and then throw themselves upon the mercy of terrified elected officials going around muttering the alternative is unthinkable…
    We will not wake up in time to avert the coming crisis. Every warning sign has been summarily dismissed. The shoals of the world economy are on our bow, it’s only a matter of time until we wreck ourselves on the hard rocks of reality. Gods save us when that happens…

  47. bman says:

    @Kent whitlesstraw, who bought you lock stock and barrel? Have you ever heard of criminal imcompetancy? That is where some wise guys hires an uneducated guy and tell him” I don’t care about how you do it, I want it done, by Friday! The fact that some of the uneducated people were accreditted lawyers is a seperate issue. Any prosecuter worth his weight in salt would go after the wise guys.

  48. patfla says:

    To choose incompetence from incompetence vs. malice is of course the reasonable, right-minded way to think.

    Unfortunately, events of the last several years have not born that out. I used to work in the finance industry (but not in New York) and at the time I assumed that, yes, of course there’s corruption in finance but, well, it’s a stain (or some large stains). However the worst suspicions of right-minded people have been exceeded and we find that the system was (and still is) shot through with gangrene.

  49. FrancoisT says:

    Obama is to the financial industry what Bush was to the energy industry.

    Considering that Obama in person told the rest of us that the banksters are “savvy businessmen”, it’ll be (of course) out of the question for his Administration to ask the DOJ to prosecute them with vigor.

    And, even if he wanted to do so, he wouldn’t be able to!

    Why?

    DOJ prosecutors of financial crime don’t believe banks can ever be guilty of fraud. You read that right: Here’s the money quote:

    http://www.newdeal20.org/2010/12/28/in-2011-watch-for-more-de-facto-decriminalization-of-elite-financial-fraud-31135/

    Benjamin Wagner, a U.S. Attorney who is actively prosecuting mortgage fraud cases in Sacramento, Calif., points out that banks lose money when a loan turns out to be fraudulent. An investor in loans who documents fraud can force a bank to buy the loan back. But convincing a jury that executives intended to make fraudulent loans, and thus should be held criminally responsible, may be too difficult of a hurdle for prosecutors. ‘It doesn’t make any sense to me that they would be deliberately defrauding themselves,’ Wagner said.”

    Did you catch this? For this guy, the CEO has his interests perfectly aligned with the entity he’s running. And I am the morganatic spouse (the 3rd one to be exact) of the Pope of Byzantium.

    Prof. Bill K. Black body slam and apply an intense Scorpio Grip to the above mumbo-jumbo this way:

    Mr. Wagner is confused by his own pronouns: “It doesn’t make any sense to me that they would be deliberately defrauding themselves.” This direct quotation needs to be read in conjunction with the author’s description of his position: “banks lose money” when loans “turn out to be fraudulent.” Wagner was responding to a question about control fraud — frauds led by the person controlling the seemingly legitimate entity who uses it as a “weapon.” The relevant “they” is the person looting the bank — the CEO. The word “themselves” refers not to the CEO, but rather to the bank. The CEO is not looting the CEO; he is looting the bank’s creditors and shareholders.

    You don’t say! Must be what Obummer meant by “savvy”: They loot enough to provide huge contributions to the political parties machines. Remember that Obama will need a cool no-te-jodas 1 billion for his 2012 re-election. No wonder he is meeting so many business executives in private meetings while never granting the same opportunity to workers.

    By the same logic, he will make sure not to bite the hand(s) that feeds his political career.

  50. goodrich4bk says:

    Those here who don’t understand why these borrowers are expecting some help appear to have forgotten that in Sept 2008 all of our major banks, including BofA, were in exactly the same position, if not worse. They owed billions to creditors and had no ability to pay any of it because there was a run on their source of funding, i.e., the commercial paper market. They got to that position EXACTLY the same way these borrowers got there: they assumed they could always pay their debts by selling their collateral. When that collateral became un-sellable, taxpayers rescued them via the Fed, TARP and dozens of indirect and direct subsidies that total more than $3 trillion.

  51. Lugnut says:

    “I knew Eric Holder, but don’t recal his middle name ever being used.
    That said, I can’t recall one positive thing he’s done.”

    He’s fulfilling a quota.

  52. diogeron says:

    Maybe the Tea Party crowd should modify their slogan of “keep the goddamned government’s hands off my medicare!” to “keep BOA’s goddamned hands off my front porch!”

  53. Darkness says:

    With a very large financial organization, failure to mitigate incompetence equals malice.