Pope Francis has formed a commission to investigate the Vatican Bank. What makes this move very important is that the commission is to report to him directly, and bypass the Vatican bureaucracy.
John Paul I (he had such a kind face)
A number of books have been written about the corruption – and sometimes criminality – emanating from that bank.
It’s long been rumored that Pope John Paul I was murdered (in 1978) because he was about to focus attention on the bank. He was a humble man, perhaps in the style of Francis – the first pope to forego a ‘coronation’. John Paul I lasted 33 days. He was 55 when he was found dead in his bed. (Some of the theories about his death are here.)
So this is a big deal.
You may recall that the world-wide financial collapse four years ago was entirely the fault of irresponsible mortgage seekers who demanded houses they couldn’t afford. In other words, the little people did it. Remember that?
Since then – and while a whole passel of criminals who posed as investment bankers, ripped off their investors and made themselves obscenely rich, continued to enjoy their summers in The Hamptons – our Justice Department has been distressingly silent.
But lo, at last.
Federal prosecutors hit Bank of America with a $1 billion-plus civil mortgage fraud lawsuit Wednesday, accusing the banking giant of engineering a scheme that defrauded federally-backed agencies during the national financial crisis.
The complaint . . . accuses the bank of using a loan-origination program called the “Hustle” to process mortgage applications at high speed with little financial checking . . .
The result was defective mortgage loans that defaulted after Bank of America sold them to federal mortgage loan guarantors Fannie Mae and Freddie Mac, causing more than $1 billion in losses and thousands of foreclosures . . .
“Countrywide and Bank of America made disastrously bad loans and stuck taxpayers with the bill,” said Manhattan U.S. Attorney Preet Bharara . . . [they] systematically removed every check in favor of its own balance – they cast aside underwriters, eliminated quality controls, incentivized unqualified personnel to cut corners and concealed the resulting defects,” said Bharara.
Posted in corporate power, corruption, economy, Government, Plutocrats
Tagged Bank of America, banking, crime, economy, mortgage fraud, Politics, TARP
Joe Nocera’s column Talking Business in today’s NY Times is interesting. It seems that the House subcommittee on financial institutions and consumer credit has summoned the great enemy, the great advocate for American consumers, Elizabeth Warren. Obama hired her last year to set up the new Consumer Financial Protection Bureau – he dared not appoint her director of the new agency because confirmation was very iffy. The banks don’t care for Ms. Warren you see. She won’t run interference for them and that’s just not right.
. . . the real purpose of the hearing: to allow the Republicans who now run the House to box Ms. Warren about the ears. The big banks loathe Ms. Warren, who has made a career out of pointing out all the ways they gouge financial consumers [us] — and whose primary goal is to make such gouging more difficult. So, naturally, the Republicans loathe her too. That she might someday run this bureau terrifies the banks. So, naturally, it terrifies the Republicans.
. . . rather than waiting until July to start helping financial consumers, Ms. Warren has been trying to help them now. Can you believe the nerve of that woman? . . . at the request of the states’ attorneys general, all 50 of whom have banded together to investigate the mortgage servicing industry in the wake of the foreclosure crisis, she has fed them ideas that have become part of a settlement proposal they are putting together.
She’s a hero and as clean as they come. You go Elizabeth, you go.
Posted in Congress critters, corporate power, economy, Government, Meet the 112th!, Politics
Tagged banking, consumer credit, Consumer Protection, Elizabeth Warren, financial reform, Joseph Nocera, Wall Street
Here in this nation, we keep insisting that we do everything better than everyone else because we’re the USA. And this in spite of the facts – an economy that nearly collapsed, infrastructure that’s beyond the point of affordable repair, wars fought on borrowed money and off-budget, unwillingness to go for the most cost efficient health care to protect profit, educational decline, unaffordable universities. We keep being the Ferengi.
Today Paul Krugman takes a look at why Canada came through the banking crisis with very few scars (if any). Of course, that’s only one area in which we refuse to notice if anyone else has invented the very wheels we need.