Feds to AGs: Can't Touch This - CreditSlips

Feds to AGs: Can't Touch This
posted by Adam Levitin
August 2011

<snip>

As this NYT story notes, the administration has been putting pressure on the AGs, particularly NY AG Schneiderman, for several weeks now, urging them to fall in line with the administration's hear-no-evil, see-no-evil position on MBS and servicing fraud. The NYT story makes it sound as if the feds were jolted into intervening because of pleas from the banks. It's enough to make one think that we're back in 2005.

There are three things that particularly bother me about what's happening.

First, is that if the Feds had shown some teeth on servicing, the AGs wouldn't have to be the ones cleaning up the mess. The AGs are acting because the federal bank regulators are dancing to the same tune they were in 2000-2008: Can't Touch This. (Now they're saying to the AGs "Please, Hammer, Don't Hurt 'Em". Yuck, yuck, yuck.) Milquetoast consent orders (that impose costs on servicers without getting better servicing) and no criminal prosecutions so far other than of the garden variety warehouse fraud (Farkas et al.). It's sad to see Shaun Donovan get in on this act, though, and then claim that his intervention was "motivated by a desire to speed up help for troubled homeowners." Please.

Second, and what really galls me, is that the administration doesn't have a serious alternative. The administration is flat out of ideas on servicing and has been so for at least a year. It's not that there aren't possibilities, but none are politically palatable to an administration that is terrified of rubbing Wall Street the wrong way. It'd be one thing if there were a plan. But the administration's got nadda. Schneiderman's intervention in the BNYM settlement isn't holding up much needed servicing reform. That's just nonesense. There's nothing stopping BoA from entering into sub-servicing arrangements today if they wanted to. Even if the settlement were approved today, it would take months, if not over a year before the BoA servicing was properly transferred to third-party servicers.

Frankly, it's too late to help a lot of homeowners. We're not in damage control mode anymore, as unemployment, rather than mortgage product features is increasingly the driving force behind foreclosures. We're just doing mop-up. Put differently, the administration missed its chance to really do something on the foreclosure front when it went it opted for the weak, half-measure of HAMP. If the administration had taken aggressive action in the winter-spring of 2009, maybe things would be different. But it went with a soft-touch approach whose limits and flaws were patent from day one.

Third...

<snip>

More: http://www.creditslips.org/creditslips/2011/08/cant-touch-this.html

:shrug:

And there is no reason whatever for the state officials to truckle to the federals on this matter.

...to foreclosed upon homeowners and to "illegal" immigrants visiting their ancestral homeland.

But it never applies to the goddamned criminal bankers, 'eh Barry? Slaps on the wrists all round boys!!!!

They give them our money and then these fuckers want them to pay their fines with it.

- What a bunch of sorry, fucking asswipes we have for leaders in this pitiful country......


K&R

:puke:

bending over backward to protect the Bankers that destroyed the economy? What is the excuse now? Is anyone with money too big to fail? :banghead:

Well, except for Republican ones, I guess

according to the idiot (and I will not mention the moran to spare him humiliation).
That it was as untrue as flat earth theories as both can be linked to on the internet, this is starting to scare me, the willfull ignorance and denial is getting beyond crazy.