According to Dealbook in the New York Times of May 13, 2011 the US Attorney in New York City whose office succesfully brought the Galleon case of a billionaire hedge fund operator is the new "sheriff" in town, and Wall Street better watch out.
Overstatement. Please don't gush too much. The "sheriff" has, according to the article, served notice on "traders." Big deal. What about CEOs, Boards, Audit Committees, Executives, and institutions themselves. Yes, this is a nice conviction, but it is spurious to announce that Wall Street is now under the gun. Mortgage fraud counts by the thousands have expired because the statute of limitations has been allowed to run by SDNY and DOJ. While SDNY went after individual trophy cases, the real architects of the economic collapse have gone,and will go, unscathed. Countrywide, Nationwide, Aurora Loan Services,and so many others and their owners and executives all knew what "liar loans" were and sold them by the tens of thousands. Billions were made. Some civil cost of doing business fines were paid, using taxpayer dollars, but not one major case has been, or will be, brought for mortgage fraud on the grand scale it occurred. Enjoy Galleon, but don't kid us by saying Wall Street will be deterred. DOJ hasn't done its job, and the rule of law is moribund.
According to Dealbook in the New York Times of May 13, 2011 the US Attorney in New York City whose office succesfully brought the Galleon case of a billionaire hedge fund operator is the new "sheriff" in town, and Wall Street better watch out.
On April 14, 2011 Gretchen Morgenson and Louise Story published an excellent article in the New York Times on the lack of prosecution in the mortgage fraud debacle. I recommend it to you. Unfortunately, the article, while documented differently than my work, and while important for whom the authors quote, states merely what I have been saying since 2000, and what I wrote starting in 2007. It amounts to hand wringing, and will produce no results; but, in fairness, it accomplishes what I have been trying to do here: get this horrible story out so the public can fully understand what a great crime has been perpetrated on the nation.
Below is the Comment I posted and was published on the Times article. I hope you find it of interest:
Another excellent report by Morgenson and Story. A day late and a dollar short. I have tried to reach these reporters since 2008, when I started writing "You the Jury, How Wall Street Cashed In On the American Dream and Nearly Killed It." I told the NYT that I warned Bear Stearns, Lehman, and others as far back as 2000 that their mortgage origination practices were unsustainable. Nobody was interested.
Publishing a book declaring three years ago what this article says today has led to nothing. No one cares. Statutes of limitation have expired on most of the possible mortgage fraud counts.No major prosecutions is not news, it is a sad fact of life. FBI boasts of its mortgage fraud cases ignore the fact that their numbers are built on the pursuit of buyers, brokers, appraisers, and other functionaries, not on prosecution of the real criminals in the banking industry who destroyed the housing markets and the economy.
As a federal prosecutor in the seventies I prosecuted the nation's largest mortgage fraud cases ever. Today's crimes dwarf my prosecutions, but they have never been brought and will not be brought. What is not deterred becomes incentive. We are witnessing the greatest whitewash in American history. Friends are refusing to prosecute friends. Business partners are being shielded by colleagues and former business partners now holding public office. The cases are NOT as hard to prove as has been portrayed. They are not. There is simply no political will to proceed. Mr. Mukasey, as Attorney General, likened mortgage fraud to "street crimes" and said prosecution should be left to local authorities. If ever a pass were given, that was it. Holder's Justice Department is just as bad. No amount of public outrage will reverse this course because the powerful interests involved are above the law. And that does not bode well for the rule of law or for the nation.
wallstreet mortgage fraud.com reflects these thoughts and more, and precedes this article. The Rolling Stone nailed this area several months ago. The problem is not that people don't know what's going on, the problem is that our Government has failed its duty to uphold the law. Shame on everyone involved.
Below is a short series of e-mails between me and one of the major Government "investigative" units involved in the pursuit of justice in the mortgage fraud scandal. Read it for yourself. I have redacted certain contact information, but the content is complete. Stay tuned to see what results, if any, there may be.
(1) Complaint: (January, 2011) I am a former EDNY federal prosecutor with specific knowledge of criminality by investment and commercial banks in the mortgage origination process. I prosecuted FHA/VA mortgage fraud at unprecedented levels in the seventies, and worked with Bear, Lehman, and others from 1999-2005. I know what they did, and it was not accidental or a "perfect storm." It was deliberate fraud, buttressed by conscious avoidance and reckless disregard. Mr. Barofsky, himself, would do well to contact me. We speak the same language. Check me out.
(2) Response From TARP (April, 2011):
From: SIGTARP.Hotline@treasury.gov [mailto:SIGTARP.Hotline@treasury.gov]
Sent: Tuesday, April 12, 2011 7:03 AM
Subject: SIGTARP Complaint Response
Dear Mr. Accetta,
The Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) is in receipt of your email dated January 27, 2011.
Thank you for your submission to the SIGTARP Hotline. The information you have provided is important to us.
At this time, SIGTARP requests further information regarding your current situation, a summary of your complaint, names, addresses and phone numbers of any relevant contacts and the current status of your complaint would be greatly appreciated.
This information of a possible violation of law in association with the TARP should forwarded to our offices via phone at 1.877.744.2009 or by email at SIGTARP.Hotline@do.treas.gov
Special Inspector General - TARP
U.S. Department of Treasury
(3) My Response (April, 2011):
Sent: Thursday, January 27, 2011 12:14 PM
Subject: SIGTARP Complaint Form
My "Complaint" is that DOJ, the SEC, Congress, and the remaining law enforcement authorities have not brought a single major prosecution against a single major player in the collapse of the housing markets. My Complaint is that fraud has gone unpunished, and that without deterrence there will surely be a repetition of the criminal behavior that has laid the economy to waste.
The attachments here provide you with my background. The contents tell you how it was done, who, among others, did it, and how to prove it. The FBI boasts of numbers of investigations and prosecutions, but fails to mention these cases are the pursuit of buyers, brokers, and other minor participants in a systemic fraud. Those numbers are meaningless. The fact that your response comes 4 months after it was received, and that most hearings and enforcement "investigations" such as Countrywide are now closed is not encouraging to me.
I submit this in the hope that someone, somewhere, is serious about mortgage fraud. Read the materials. I am available to those who really want to do something.
Read Joe Nocero's article in the New York Times, March 25, 2011. He tells the story of a borrower who is going to jail for mortgage fraud. A borrower. Not a banker or broker or investment banking executive or a compiler of mortgages for securitization, a borrower. In my Book, you are told that catching borrowers and brokers is "child's play."
It would appear the Justice Department is more interested in child's play than it is in real prosecution. A couple of days ago I posted here about the FBI's phony numbers. The Times proves my point.
People need to know what their government is doing. It is neither doing good nor well.
Thanks to those who have made so many kind comments. I don't expect to make money off of this, but I do want to get the word out that there are most certainly ways to hold highly placed executives and big power banks accountable for destroying the housing markets and ruining the US economy. Millions have been irreparably injured by greed, corruption, and fraud. Our government has given lip service to accountability, but has done nothing of substance to deter future financial crime. Money and power have trumped the rule of law and compromised the integrity of the nation. I ask for your help in sending out this message. Please publish this site wherever and to whomever you can. Not until our voices become too loud to ignore will anything meaningful happen. Please join in being a solution, and not just an observer. Thank you.
Following is an excerpt from You the Jury. It focuses on how to prove Wall Street knowingly committed crimes. The Justice Department, and pundits, have lamented the difficulty of proving criminal cases. While only part of the picture, this excerpt addresses the origins of Wall Street's actual knowledge of the scope of mortgage origination fraud. The key to proof is people. Not computer programs. Not projections and business models, but people who will testify that they were pressured to produce mortgage volume regardless of borrowers' ability to repay, that their bosses demanded such volume, and that the line of instruction ran all the way to the top of Wall Street. Proving these cases is not nearly as difficult as the public has been led to believe.
PROVING WALL STREET KNEW
Is there proof that Wall Street executives knew their mortgage origination partners and subsidiaries were falsifying information in order to generate mortgage loans? Prove such knowledge, and you prove that Wall Street aided and abetted securities and mortgage fraud. It was Wall Street that demanded the high volumes of loans that securitized the CDOs Wall Street was selling. It was Wall Street that populated the collateral for the securities. It was Wall Street that profited from every step of the transaction from origination to securities sales and resales.
The proof is in the mortgage applications. ...., finding false statements in mortgage applications is child’s play. Until now, no one has said that securitization departments of world class investment banks actually knew what the mortgage origination industry was doing in order to generate the huge volumes of loans Wall Street needed to populate their Derivatives. Well, now it is being said. Here and now. Yes, they did, they actually knew.
Beginning in at least 1999 Wall Street investment banks engaged in a pattern and practice called “netting.” Netting was the practice of Wall Street investment banks that sold collateralized securities sanitizing those securitized mortgage packages for the benefit of their investors. In netting, bad, or defaulting, mortgages underlying a securitized instrument are substituted in the portfolio and replaced with good, or performing, mortgages in order to maintain the quality of the portfolio. Simply put, investment banks kept investors in securitized mortgage portfolios from suffering losses by bailing them out. The investment bank takes the bad mortgage out of its investor’s portfolio, tells its customer/subsidiary/partner/mortgage origination entity to give it a “good” mortgage, and delivers the “good” mortgage to its investor. The investment bank and the mortgage company then decide between themselves which of them should or will bear any loss from the “bad” mortgage. Then the "bad” mortgage is foreclosed upon, and the real estate is put up for sale, with a new round of fees and commissions. The new mortgage is put into another package for a securitized sale. These are the losses which Bear Stearns and Jimmy Cayne scoffed at and said so much money was being made that even a $185 million loss on “bad” mortgages was “nothing.”
How do I know this? I participated in negotiations with an investment bank’s origination source in 2000. The question was who will bear the loss? The answer revolved around who had allowed the fraud to take place. I argued, for the investment bank, in a very real case, that it is the originating lender’s job to know that the seller is, in fact, the seller, and not someone who had stolen the identity of the true owner and had sold the property to a straw man buyer, and collected the proceeds. In laying out these facts, it was clear the originating broker was at fault for the loss. The investment bank sent the loan back, and the mortgage bank “ate” the loss.
There were other such negotiations. In all of these cases the investment bank argued that the originating mortgage bank either committed or permitted fraud. For the investment bank to argue that its originator committed or permitted or ignored fraud means only one thing: it knew, had actual knowledge, that its partner was processing phony mortgages. There is no other possible conclusion. The investment bank claimed damages because its origination partner had failed its underwriting function, and had approved loans based on fraudulent applications. The investment bank, in each case on which I worked, uncovered the fraud, and used the fraud to demand reimbursement after the mortgage defaulted and was netted out of the investment bank’s customer’s portfolio.
Every investment bank that netted in this way knew that their loan origination sources were processing mortgage applications based in fraud. What’s more, these mortgages were quick to default. As time went on, the investment banks could and did chart foreclosure rates based on the time of default, the volume of default, and the outcome of the netting negotiations to determine who would bear the loss. In 1999 and 2000 this was a time consuming and bothersome process. As Wall Street began to appreciate the full potential of the sub prime and conventional mortgage markets as principals, and not as middle men, the entire process not only exploded exponentially, but also found sophistication and finesse.
On Wall Street, economic advantage is chum in the water. Investment banks quickly figured out that mortgage origination was a huge opportunity. Why miss out on origination and processing fees? Why endlessly haggle with origination companies over who should take the losses which were the inevitable consequence of the poor underwriting standards necessary to generate high volumes of CDO collateral? Why not control the mortgage market from top to bottom?
Wall Street firms said, “Why should we be middle men? Why not take both sides of the deal, and profit from both the origination and the packaging of loans?” Why not, indeed! It didn’t take long for Wall Street to buy the nation’s biggest mortgage banks. Mass production of mortgages was now within the control of investment banks, along with commercial banks like Citigroup and Bank of America, as owners of the means of production. As we have seen, they knew exactly what they were buying.
While real estate was moving, and more borrowers were paying their loans than not, and new mortgages were being generated in volume, it was easy to substitute good loans for bad. Hundreds of millions in losses were considered inevitable, but eminently acceptable.
Each of them had accused their new subsidiaries or partners of creating fraudulent mortgages. Each of them knew the default rates, and, more importantly, knew the reasons for the defaults. Each of them felt they could handle the defaults, and make extraordinary profits in the bargain. And, they were right, for a while.
And so Lehman bought Aurora Loan Services and First Alliance Capital. Bank of America bought Countrywide, and Citigroup bought Ameriquest, a notorious sub prime mortgage originator, as well as other derivatives based financial institutions. Investment banks like Merrill Lynch, Goldman Sachs, Credit Suisse and other financial institutions, made other purchases or else entered strategic partnerships, all so that mortgage loan production could be controlled from the top, and a steady flow of CDOs could be assured.
With control of mortgage origination operations it was no longer necessary to negotiate the distribution of losses. The sale of securitized packages became much more sophisticated than that. Because of the experience investment banks gained in the early years of their mortgage operations, investment bankers knew that sub prime loans, in particular, were even riskier than their name suggested. High volumes of sub prime loans produced prodigious default rates. Other loans, originated in the environment of “no doc” applications, supported by “accountant’s letters” certifying as to the existence of a person, but not their financial means, also had increasing default rates. Rather than seeing these defaults as early warnings, Wall Street simply used them as pricing tools. Packages were constructed to include higher interest rates for higher risk mortgages and lower interest rates for lower risk mortgages. This is crucial. Pricing was predicated on the knowledge that certain loans were much riskier than others. The pricing decisions could only be based on one thing: ACTUAL KNOWLEDGE THAT CERTAIN MORTAGES WERE DESTINED TO DEFAULT.
It would be unfortunate to suggest that every pricing decision was a criminal act. Clearly defaults are to be expected in the mortgage business. It is not criminal to price a security on the basis of a projected default rate, and to vary pricing and return to reflect greater or less risk. The line is crossed, however, when the investment bank selling the security knows that there is fraud at the base of the mortgage pool, and does nothing to deter the fraud or warn investors that the risk they are taking is far greater than they know. It is one thing to price based on projected defaults. It is another to price knowing that fraud will exacerbate the factors which lead to default.
Robert Mueller, Director of the FBI, recently testified before a Congressional committee that there are thousands of mortgage fraud criminal investigations open across the country. He intended to blunt criticism, such as mine, that there has been no accountability imposed on the financial industry for mortgage fraud crimes committed from at least 1999 through at least 2007. His numbers are fake and meaningless.
To be sure, Grand Jury proceeedings are secret. There is no way I or anyone not involved in actual prosecutions and investigations can say with absolute certainty that there are no major enforcement actions brewing. Having said that, the evidence suggests that the FBI numbers are a sham.
The leading perpetrator of fraudulent mortgages in the nation was Countrywide Financial. Both the company and its head, Angelo Mozilo, have been told they will be not be criminally prosecuted. Civil fines imposed by the SEC required no admission of wrongdoing, and the amounts involved amounted to cost of doing business parking tickets. Similarly, executives of other banks, including Washington Mutual and Indy Mac, large mortgage players, have been approached about civil penalties in relative pennies, but not have not been photographed and fingerprinted on their way to criminal trials. No Wall Street investment bank has been indicted, nor has any major executive of a Wall Street investment bank been charged with mortgage fraud, securities fraud, or any number of other possible mortgage related charges.
The likelihood of criminal charges fades with each passing day. Statutes of limitation, generally, range between two and six years for financial crimes, with the six year statute reserved for tax evasion. Conspiracy has a five year statute of limitations from the date of the last overt act. It is now twelve years from every crime commited in 1999. It is four years from crimes committed in 2007, the year the bubble burst. That means that the statute of limitations has expired on thousands upon thousands of false loan applications, bogus securitizations, and mail and wire fraud charges through March of 2006. That means that counts, penalties, and fines have been irretrievably lost. In addition, the chances are overwhelming that documentary evidence of these crimes has been lost or destroyed by perpetrators who have not been subject to subpoenas and required to preserve such evidence.
That is not a formula for successful prosecution. On the contrary, it is a way to whitewash the financial industry and set the stage for fraud in years to come. What is not deterred becomes incentive.
The worst, though, is that the FBI and some state attorneys general have crowed about prosecuting mortgage fraud as if they've actually done something effective, something special. The FBI brags about mortgage fraud task forces. States have received millions in federal grants to team with the Bureau in these "task forces." But these highly publicized investigations, and resulting convictions, are, in themselves, something of a fraud.
What the public needs to know is that the task forces are about numbers. As a result, these investigations start with prosecutions of buyers who lied on their applications. Is that likely to deter the Wall Street mogul who securitized that mortgage? Then the prosecutions escalate-to appraisers, and to real estate brokers, and to mortgage brokers, and, on rare occassions, to the minor mortgage banking company which underwrote the paper. In other words, the smallfry. Those are starting places, not ending places, for going up the ladder and getting those who are really responsible. I have been told, personally, by a high ranking state mortgage task force director, "We're after numbers. We don't want to go higher. It takes too much time and effort. Our funding is short term. The only thing we want is to pile up conviction numbers." That is, indeed, a quote.
There is no political will to prosecute the rich and powerful bankers who caused the greatest economic collapse in world history. The public needs to rise up and shout. But even if it does, I doubt the politicians will do anything. So much for the rule of law, don't you think?
The following column by Al Lewis was published on MARKETWATCH on April 23, 2011. It accurately reflects the Author's frustration with the failure of the Department of Justice and other law enforcement agencies to deter the scourge of mortgage fraud which ruined the US economy. The author's complaints go back to 2000, long before the public realized that no one would be held accountable for trillions in lost and stolen money.
April 23, 2010, 12:54 a.m. EDT
Spilled blood would bury mortgage fraudsters
Commentary: The frustrations of a former U.S. Attorney
By Al Lewis
NEW YORK (MarketWatch) -- You'll have to excuse my old friend, Anthony Accetta. He gets excited.
"You need to write a column," he raved. "The collapse of the housing market has destroyed the economy and
destroyed the social fabric in this country."
Hardly sounds like news to me, Tony.
"Because you know it," he said, "so it doesn't seem like news to you. But nobody is writing this. Only you have the irreverence to get away with it."
Come on, I replied, everybody is writing it. The Securities and Exchange Commission filed civil charges against
Goldman Sachs Group Inc. (NYSE:GS) on Friday. And Congress is skewering former Lehman Brothers Chief
Executive Richard Fuld as we speak.
Nobody cares, Tony. There's nobody left to care what with the social fabric of the country destroyed, and all.
"Wall Street actually knew the mortgages were bad," Accetta
continued. "That's the key. That's the fine point that nobody
understands. They knew the mortgages were bad and they put them
into mortgage pools anyway. They actually committed crimes."
Accetta is 66 years old and longing for the days when he was a
I first met him in April 2005 at the Intercontinental hotel in midtown
Manhattan. He told me he was doing private financial investigations
for some of Wall Street's biggest firms, and that they were too often
telling him to temper his reports.
He said he was frustrated and moving to Denver to focus on smaller
companies that might actually take his advice. What he'd
learned was that America's biggest investment houses and banks
were systematically committing mortgage fraud. And he swore that
when the housing bubble popped they'd all be laid to ruin.
Of course, Accetta never imagined the extent to which the U.S. government would bail them out and gloss
"Every major Wall Street bank has committed mortgage fraud," Accetta cried again on Tuesday.
I know, Tony. So what? Regulators will sue them. Congress will grill them live on CSPAN. And life will go on. It's that millions of Americans won't have houses, or jobs or 401(k)s anymore.
Last year, Accetta sent me a book that he wrote: "You, the Jury: How Wall Street Cashed in on the American Dream,and Nearly Killed It." It's a compelling read, but he has yet to find a publisher.
"So why a book about mortgage fraud when nobody cares about mortgage fraud?" he wrote. "Well .. mortgage fraud is the single largest contributor to the greatest economic crash in history.
"Sadly, you are about to learn that, to date, crime pays. You are about to learn that the forces of wealth and power have not only committed the greatest economic fraud in history, but also that the fraud continues and the perpetrators are being rewarded, not punished, for their crimes."
In 1972, Accetta was an assistant U.S. Attorney in New York. Those were the good old days when mortgage fraud was considered a felony. He chalked up 70 convictions. Even the regional director of the Federal Housing
Administration went to prison.
But those glory days are gone.
"The SEC announces civil charges, then it settles, nobody admits anything, nobody loses a license, and it's just a cost of doing business that gets paid by the consumers."
"Robert Khuzami (the SEC's director of enforcement) came out of Deutsche Bank (NYSE:DB) for Christ sake. Don't tell me these guys are seriously enforcing laws. They're not doing anything to deter bad actors.
"The President of the United States even gave Wall Street a code," Accetta continued. "He said, 'You're all going to be held accountable.' But then he said 'We're not going to look backward. We're going to look forward.' That's doublespeak."
"All Obama wants is more power to regulate. He wants to tell people how to do business, but he doesn't want to put bad people out of business.
"We don't need new regulations. We need prosecutions."
Accetta is hardly a lone voice. On Tuesday, William Black, former litigation director of the Federal Home Loan Bank Board, told Congress that recent civil actions from regulators didn't go far enough.
"If there's civil fraud, there is in fact criminal fraud there as well," Black testified. "There's simply a higher burden of proof."
So far, prosecutors haven't been gathering that proof, Accetta complained.
"Bernie Madoff was the worst thing that ever happened to law enforcement in this country. His guilty plea allowed prosecutors to say, 'Oh, you see, we're going after these big fraud guys.' But they haven't really gone after anybody."
Criminal charges are difficult to prove, I reminded Tony. Maybe it just takes time. I just saw Fuld swear before
Congress that he never heard of the now infamous Repo 105 transactions -- even as they topped $50 billion.
"Yeah? Well, I'd like to subpoena all the people who told him all about it," Accetta said. "He had a fiduciary obligation to know it.
"What they need is a grand jury. ... How do you think I made my cases way back when? I had a grand jury going for 16 months. I was dragging people in left and right. I scared the (bleep) out of them and they all spilled their guts.
"There are a million people out there ready to spill their guts. And your government is not asking them to do that." Accetta continued. "They haven't got the courage to go after rich and powerful people. They want to get reelected, and it's corrupt.
"I had 70 convictions. I know how to prosecute these cases," Accetta continued. "I know for a fact that there are witnesses by the bucketful who would testify if they were in front of grand jury. If you throw out the net, you're going to catch a bunch of fish."
OK, Tony, I conceded. So why don't you get another job working for a U.S. Attorney's Office and go for it?
"They wouldn't have me," he sighed. "I'm too old."
Copyright © 2010 MarketWatch, Inc. All rights reserved.
The Federal Reserve recently took a first, halting, step toward reforming the real estate/mortgage business by forbidding, under some circumstances, the payment of commission compensation in mortgage originations. It's not a big step, and certainly not a decisive step, but it's the first substantive step toward at least putting brokers on some sort of leash. Of course, without real law enforcement in the mortgage origination business, fraud will continue. But when somebody does something right, they should be acknowledged. There is a good discussion of the Fed's actions at the National Law Journal's site for March 10, 2011. The reaction of brokers is predictable.
The following is a synopsis of "You the Jury, How Wall Street Cashed In On the American Dream and Nearly Killed It." The past 40 year history of mortgage fraud, the hows and whys of what Wall Street did between 1999 and 2007, and the shocking lack of prosecution by, especially, federal authorities, are laid out for your information, and, hopefully, your civic outrage. For the past 13 years our criminal justice system has been a system of men, not laws. Only an understanding of exactly what happened, and who did it, can equip us to prevent even more fraud in the future.
Mortgage fraud caused the collapse of the America housing market. Mortgage fraud caused the collapse of the financial markets and the insurance markets, and threatened the global economy.
Mortgage fraud was practiced on a systemic level by major Wall Street investment banks, major commercial banks, mortgage banks, and virtually the entire real estate industry. From personal experience with Bear Stearns, Lehman Brothers, and Credit Suisse, Indy Mac, among others, I know the practices used to knowingly create fraudulent mortgages, knowingly package them in securities, and knowingly reap hundreds of billions in profit, while passing certain failure, not mere risk, on to unsuspecting investors and insurance companies.
Government response to criminal conduct has been superficial and ineffective. President Bush's Attorney General Mukasey dismissed mortgage fraud as a “street crime” and left prosecution to understaffed and overwhelmed “local prosecutors.” In 2008 mortgage fraud was number 106 on the Justice Department’s priority list. Two Presidential Administrations and the current Attorney General, Eric Holder, have looked the other way. Rather than demand accountability, Government has paid trillions to investment banks, commercial banks, insurance companies, and their investors to hold them harmless and allow them to profit from their own crimes, while leaving the taxpayer holding the biggest bag in history. Goldman Sachs sold mortgage backed securities at a premium on the market, while simultaneously selling those same securities short in its own portfolio. Do you think they knew something about the quality of their collateral?
Bombastic calls for more regulation, more oversight, and more laws are camouflage for a lack of political will to prosecute, both criminally and civilly, the Executives, Boards, and Institutions which are responsible for systemic fraud. A culture of taking profit while shifting risk has victimized the American people. Government has added to the problem, not solved it.
Mortgage fraud has been going on for over forty years. Without serious reform, without the creation of a system which shifts risk back to the financial, mortgage, and real estate industries, there will always be another cycle of corruption, and we will pay for it again and again.