The Fourteenth Banker Blog

November 10, 2010

Bill Black Slam Dunks American Banker Columnist!

Filed under: Running Commentary — thefourteenthbanker @ 7:38 PM

In these two posts, Part 1 and Part 2, Bill Black mops the floor with American Banker columnist Andrew Kahr. In his column, Kahr had suggested that mortgage applicants be prosecuted to the full extent of the law including fines up to $1 million and up to 30 years in prison, if they gave false information in a mortgage application. Kahr is suggesting that banks comb their files and make criminal referrals to the U.S. Attorney in their jurisdiction.

Laws against bank fraud are of course necessary and appropriate. However, Black makes an amazing case that what has happened in general is widespread fraud by predatory lenders. He uses Kahr’s own words to convict him.

I find it incredible that with an abysmal record in regard to home mortgage origination, securitization, servicing, and foreclosure, a financial industry representative would recommend severe sanctions for clients. Yes, there are some who did intentionally commit fraud. But what is good for the goose is good for the gander. The U.S. Attorneys should start by prosecuting the fraudsters in the industry who knew what they were doing and did it for personal gain. Only then might there be some hope of an honest banking industry.

 

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4 Comments »

  1. Great post! Thanks also for the links to Bill Black’s two pieces.

    Comment by Lawrence — November 10, 2010 @ 10:46 PM | Reply

  2. “Blame the victim”. Works every time. Here’s Matt Taibbi’s piece on the “rocket docket” in Florida –

    http://www.readersupportednews.org/off-site-opinion-section/83-83/3905-courts-helping-banks-screw-over-homeowners

    My daddy always told me, “It’s not what you know; it’s WHO you know.” When you “know” important lawmakers (or have them in your vest pocket), it’s so much easier to let the little guy take it in the neck, whether he screwed up or not.

    Comment by Sandi — November 11, 2010 @ 11:29 AM | Reply

  3. PS – Listening to an news show recently about people who had tried to get their loans modified – the horror tales of being told “the paperwork was lost”, or that they were missing some “vital” piece of information, then being sent to the back of the line to start over, sometimes as much as 20 times, until the clock runs out. And yet the lenders are now hiding behind the “dog ate my homework” defense, when they can’t produce the necessary documentation. Talk about your double standards!

    Comment by Sandi — November 11, 2010 @ 2:46 PM | Reply

  4. A most interesting tactic by the bankers. If Kahr gets it going, the banksters will flood the law enforecement agencies with prosecution referrals. Drown em. If the banksters were really organized they would continually follow up on tardiness of law enforcement efforts and make big stinks about it. Feed the laws so much they choke on it. Prettttty Smaaart if they carry it through.

    Comment by Jerry J — November 11, 2010 @ 5:05 PM | Reply


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