Zero, Nada, Zip: That Would be the Number of Arrests
The legend has it, “Those who fail to learn from history are doomed to repeat it.” [Something like that.] Bill On financial matters, Bill Black is one of the guys always worth listening to. He was a successful bank regulators who handled the Savings and Loan debacle in late 80s and early 90s. In this video clip, he points out the bitter truth that to this point in the financial crisis perpetrated by mortgage fraud, no single convictions or arrest has been made. Contrast that to during the S&L crisis, about 1000 convictions of senior insiders. According to FBI, today 80% of mortgage fraud cases occur when lender personnel get involved. They created incentives to loan officers purely based on volume not on quality.Some loose quotes from the video.
“19 large and systemically dangerous institutions are essentially insolvent.”
“Congress extorted FASBI to change accounting rules to let the financial institutions inflate their assets.”
The worst mistake a Government can do it take the approach, “It must be cyclical let’s wait this out.” Recurring crises. They get bigger and disastrous. This is a must watch PBS video.