FBI investigating 14 firms in subprime crackdown

News item: A quickie from Rob via the comment section: Reuters reports, "The FBI has opened criminal investigations into 14 corporations as part of a crackdown on improper subprime lending, agency officials said on Tuesday. ... FBI officials told reporters the probes involved potential violations, including accounting fraud and insider trading."

Bloviation: It has been my contention the Justice Department has been very slow to investigate and prosecute mortgage fraud that is, by almost any account, widespread.  When Justice wants to move quickly and send a message, it is more than capable (Ask any former employee of Arthur Andersen what happens when Justice throws its weight around). That's not happening at the moment.

Your thoughts? Insights? Email story tips to peter.viles@latimes.com.

Comments

[mbob]

Dear Bloviator

Our Justice Department motivated by political influence? See here my dear fellow, how dare your raise the specter of such a fearful possibility?
(Recite the above mimicing "Foghorn P. Leghorn" or any other US Senator from S. of the Mason-Dixon line)

Ah, for the days when our esteemed FBI director had the courage and strength to be photographed in a nifty strapless evening number, basic black of course, in the manly company of Clyde Tolson.

I guess "improper" is in the eye of the beholder.

Maybe we'll finally be treated to an interpretive staging of "The Marx Brothers Meet the Three Stooges, as Directed by Monty Python."

[Lou]

This is great news. People always say there were no laws protecting us from subprime lenders. Actually there were. The same laws that protect us from people like John Gotti. These lenders were glorified loansharks and racketeers. The CEOs should get prosecuted under RICO statutes because they were running a criminal organization. Angelo, don't drop the soap.

[Inland Empire]

Bloviation: It has been my contention the Justice Department has been very slow to investigate and prosecute mortgage fraud that is, by almost any account, widespread.

I remember someone waaay up the food chain politically blithering about how all Americans should own homes a few years ago. Seems to me more of "let's protect big business".

[CD]

Excellent article in Robertreich.blogspot.com on :The real recession problem:
"Consumers are at the end of their ropes." Simple and to the point.
Lets re-open the Bastille down on Wall Street !!!!

[JohnnyB]

A slow start... at least A start... but a LONG ways to go.

This should extend to wall street firms and their “questionable” mortgage SECURITIZATION and COLLATERALIZATION practices as well. This poo ran down hill, not uphill... as poo always does.

Well, upon further consideration, when poo hits the fan it can splatter all over…

It’s really a sequence of wall street derivative poo being repackaged (potentially criminally) to not look like poo… then securitized and collateralized into poo-poo and hitting various fans around the globe… and then splattering living, breathing people, not faceless numbers.

When banks don’t have to put poo on their books, nobody knows where all the stench is coming from until it’s too late… see poo hitting the fan above.

I’m amazed the Justice Dept. has put up with this stench so long… well, not really.

[Rob]

Thanks for the visual JohnnyB....

[diane hall]

So where is the "list" of banks, mortgage companies and lenders, with countrywide connections, that the FBI is FINALLY investigating?
Predatory lending, misuse of funds, non-application of mortgage payments to principal. Escrow accounts that should have not been created. The list is endless. How do you get the court system to prosecute the lenders, not the unwaring borrowers. The borrower is the loser in all cases I have heard of and researched here in NV. Countrywide was paying up to 7% outside of escrow to the broker, after the borrower paid his 7% plus unregulated fees to a title company which didn't exist in the loan paperwork.
Any clues as to who to GO TO to resolve the issues without a lawsuit. Borrower is NOT IN DEFAULT, JUST P'D OFF.

[Maggie Knowles]

mbob - I've been looking everywhere for a copy of that picture...