Forum Post: Wall Street Crimes need to be addressed
Posted 12 years ago on Oct. 13, 2011, 4:52 p.m. EST by precipice
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Mortgage Foreclosure Fraud. Banks have been systematically submitting fraudulent documents in foreclosure cases. Basically, there are two things happening here. The first is that in order to foreclose on a property you need to sign an affidavit that you have reviewed all the necessary paperwork to make sure that it is in order. People have been signing these affidavit at rates faster than they could reasonably reviewed the paperwork - meaning that they are lying. (And at least one person who was subcontracted to process foreclosures for various institutions has confessed to tens of thousands of individual instances of foreclosure fraud in court.)The second is that there are lots of missing paperwork in some cases, which banks are getting around by forging paperwork. There has yet to be a comprehensive investigation into mortgage fraud, but it is large enough that it is not "a few bad apples" and could, if pursued properly, bring down several large banks and mortgage companies.
Lying to Clients. Goldman Sachs executives were caught selling their clients mortgage backed securities that they (accurately) privately believed would turn out to be worthless without disclosing this to their clients, and without telling their clients that they were betting against the very securities that they were selling them. Private emails which were revealed by a Congressional investigation showed them making fun of their clients for being suckers.
Lying to Congress: When brought before congress to explain this, Goldman Sachs executives lied repeatedly in ways that are documented by internal GS documentation and communications.
Deliberately Creating Investment Vehicles that Would Fail So they Could Bet Against Them, and Not Informing Buyers: JP Morgan Chase designed a mortgage backed investment fund to fail, so that a client, Magnetar, could profit by betting against them. They did not inform buyers of this materially relevant fact. While JP Morgan Chase did pay a $150 million fine, they did not admit guilt.
And so on... A more important point than specific allegations of criminal wrong doing, is that investigating the mortgage backed securities industry for criminal wrongdoing does not seem to be a priority for the Department of Justice (United States), U.S. Securities and Exchange Commission, or any relevant regulatory or enforcement agency. Perhaps there are people toiling away building cases in quiet, but from what is publicly known its hard to have any confidence. Failing to prosecute and investigate politically influential elites for violating the law is damaging to the legitimacy of the state.
Occupy Resistance Network http://www.occupyr.com/General/thread.php?id=73
Commercial and investment banks used their size and money to..evade any meaningful effort to impose common sense and transparent risk controls in the public interest, known as regulation. Markets are ruled by two emotions: fear and greed, and these institutions got greedy, very greedy. They created financial products that served no real purpose, other than to generate profit for the bank. To keep customers (their only regulator) from understanding the bank’s true intent, they made these products horribly complicated. These products were, in part, simple bets. These bets were layered on top of each other until only the product designers had any hope of realistically estimating what little value actually existed in the products.
Commercial and investment banks came to act as if they understood that giving these products a veneer of social utility would help them hide their true motivation, so they tied a small fraction of these bets, now known as 'derivatives,' to subprime lending and passed the bundle off as the invisible hand of the free market at work.
"One of the nation's largest banks allegedly set up a special sales office to steer risky subprime loans to residents in Prince George's County, Baltimore city and other predominantly black communities..Wells Fargo Bank employees allege in a lawsuit. According to the sworn statements by two former loan officers filed June 1 in U.S. District Court of Maryland as part of a lawsuit being pursued by the City of Baltimore against Wells Fargo alleging discriminatory and predatory lending, bank employees targeted black neighborhoods and churches for the escalating-interest mortgages, which some in the office called 'ghetto loans.'
Many customers with sufficient income, credit and savings to qualify for fixed, lower-interest mortgages were still urged to take subprime loans..because the higher rates meant bigger profits for the bank: 'If a loan officer referred a borrower who should have qualified for a prime loan to a subprime loan, the loan officer would receive a bonus.' "
Giving (not lending) money to get a fee with the deposits to people who they knew for a fact who could never pay the loan by their own admission using "no doc" "liar" loans was an obvious crime.
Extorting higher prices from the "independent" appraisers kept allowing higher false equity to make bogus loans. Another obvious crime.
Giving huge fees to the rating agencies for AAA ratings on the bogus loans is another obvious crime.
When people are losing their jobs they became desperate for so-called easy money. That's no different than giving people free crack rocks to hook them into being addicted customers.
The government needs to allow all homeless families to live in the foreclosed homes. The government needs to stop all slave made imports. That would explode the job market and turn the economy up like a space shot blasting off.