{"id":182639,"date":"2015-07-16T22:48:00","date_gmt":"2015-07-17T03:48:00","guid":{"rendered":"https:\/\/www.panix.com\/~msaroff\/40years\/2015\/07\/16\/and-once-again-obama-bails-out-crooked-banksters\/"},"modified":"2015-07-16T22:48:00","modified_gmt":"2015-07-17T03:48:00","slug":"and-once-again-obama-bails-out-crooked-banksters","status":"publish","type":"post","link":"https:\/\/www.panix.com\/~msaroff\/40years\/2015\/07\/16\/and-once-again-obama-bails-out-crooked-banksters\/","title":{"rendered":"And Once Again, Obama Bails out Crooked Banksters"},"content":{"rendered":"

It looks like the Obama Administration has once again insured that there is no accountability for crooked banksters<\/a>:<\/p>\n

Three top Democrats are accusing the Department of Housing and Urban Development of quietly removing a key clause in its requirements for taxpayer-guaranteed mortgage insurance in order to spare two banks recently convicted of federal crimes from being frozen out of the lucrative market.<\/span>

<\/span>HUD\u2019s action is the latest in a series of steps by federal agencies to eliminate real-world consequences for serial financial felons, even as the Obama administration has touted its efforts to hold banks accountable.<\/span>

<\/span>In this sense, the guilty plea has become as meaningless to banks as their other ways of resolving criminal charges: out-of-court settlements, or deferred prosecution agreements. \u201cToo Big to Fail\u201d has morphed into \u201cToo Big to Jail\u201d \u2014 and then again, into \u201cBank Lives Matter.\u201d<\/span>

<\/span>Sens. Sherrod Brown and Elizabeth Warren and Rep. Maxine Waters fired off a letter to HUD on Tuesday, saying they believe that the timing of the change was designed to clear the way for two banks recently convicted of federal crimes \u2014 JPMorgan Chase and Citigroup \u2014 to continue to make Federal Housing Administration-insured loans. Last year, JPMorgan Chase wrote $1.67 billion in FHA loans, and Citi wrote $342 million, according to data from the Congressional Research Service.<\/span>

<\/span>On May 20 of this year, JPMorgan Chase and Citigroup both entered a guilty plea<\/a> on one felony count of conspiring to rig foreign currency exchange trades, the largest market on the globe.<\/span>

<\/span>Five days earlier, on May 15, HUD slipped a notice<\/a> into the Federal Register, seeking to alter its standard loan-level certification form, known as HUD-92900-A. This form must be filled out for lenders to receive FHA insurance, which reimburses them if the homeowner falls into foreclosure.<\/span>

<\/span>On the current HUD-92900-A form, lenders must certify that their firm and its principals \u201chave not, within a three-year period \u2026 been convicted of or had a civil judgment rendered against them\u201d for a variety of crimes, including \u201ccommission of fraud \u2026 violation of Federal or State antitrust statutes or commission of embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements or receiving stolen property.\u201d<\/span>

<\/span>JPMorgan and Citi\u2019s guilty plea would fall under the antitrust statute, and according to Brown, Warren and Waters\u2019 reading of the certification, that would make them ineligible to obtain FHA insurance on their loans.<\/span>

<\/span>On the updated form, this language has been excised. The notice in the Federal Register<\/a> did not even mention the removal, making it impossible to discover without comparing the old form and the proposed form side by side. The Wall Street Journal ran a story<\/a> about the certification changes in May, but failed to notice that the new language would let law-breaking banks off scot-free.<\/span>

<\/span>The day before HUD released the notice in the Federal Register, the New York Times reported<\/a> that the Justice Department sought to lessen the consequences of the guilty pleas in the foreign exchange rigging case, ensuring that federal regulators would not use the pleas to bar banks from certain business lines.<\/span>

<\/span>The Securities and Exchange Commission then granted waivers<\/a> from disqualification to JPMorgan Chase, Citi, and the other guilty banks in the case, over the objections<\/a> of one SEC Commissioner<\/a> that the big banks had effectively become \u201cToo Big to Bar<\/a>.\u201d<\/span>

<\/span>The HUD changes would similarly take away an automatic penalty for bank misbehavior. Per Brown, Warren and Waters, they \u201callow HUD to turn a blind eye to criminal violations \u2014 putting homebuyers and taxpayers at additional risk.\u201d<\/span>

<\/span>HUD spokesperson Cameron French said the agency was not providing comment on the Democratic letter. He said HUD would review it and respond accordingly.<\/span>

<\/span>\u2026\u2026\u2026<\/span>

<\/span>The Democratic lawmakers believe removing the certification language results in a change in policy rather than simply a change to the form. They requested that HUD withdraw the notice and issue it again under the Administrative Procedures Act, giving an explicit rationale for the change, and how it would affect JPMorgan and Citigroup\u2019s FHA loan status. The public would then have an additional 60-day comment period.<\/span><\/p><\/blockquote>\n

This sort of crap needs to end.<\/p>\n","protected":false},"excerpt":{"rendered":"

It looks like the Obama Administration has once again insured that there is no accountability for crooked banksters: Three top Democrats are accusing the Department of Housing and Urban Development of quietly removing a key clause in its requirements for taxpayer-guaranteed mortgage insurance in order to spare two banks recently convicted of federal crimes from …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1142,1010,970,969,1004],"tags":[],"class_list":["post-182639","post","type-post","status-publish","format-standard","hentry","category-barack-obama","category-bureaucracy","category-corruption","category-evil","category-finance"],"_links":{"self":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/182639"}],"collection":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/comments?post=182639"}],"version-history":[{"count":0,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/182639\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/media?parent=182639"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/categories?post=182639"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/tags?post=182639"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}