I’m not exactly surprised at the bait and switch by Iowa’s Attorney General Tom Miller, who is leading the 50 state investigation by state attorney generals into mortgage abuses. Less than a month ago promised that he would “put people in jail” Now he’s apparently decided to adopt a “move along, nothing to see here” posture.
And as we’ve written, attorneys representing homeowners have found evidence of widespread, and what appears to be systematic violations of contracts and Federal law in how servicers apply payments and charge fees to borrowers, with the net result in more than a few cases that homeowners lose their house due to the pyramiding junk fees rather than bona fide delinquency (as in any arrearage was minor and ex the abuses, could in many cases have been remedied). These attorneys are not able to do a systematic investigation; the state AGs could (and a pattern and practice of fraud would lend itself to criminal charges). But their rush to wrap this up says they indeed have not intent of cleaning up servicing, their pious claims to the contrary.
But the die was apparently cast with Miller from the get go. I was troubled in his testimony before the Senate Banking Committee when he went out of his way to lavish praise on Michael Barr of the lapdog Treasury Department. And this December e-mail gives some insight into Miller’s thinking:
I was w/ a European documentary maker this weekend who spoke to Miller a few days ago and said Miller relayed the fraud isn’t so bad, everything will be worked out .. the standard line; he’s already made up his mind. He doesn’t want those European governments demanding their money back.
So the same pattern continues: we’ll trash the rule of law and throw homeowners under the bus to save bank balance sheets. As reader Duncan put it:
So TBTF banks win yet again and the powerless taxpayers (what’s left of us) get stuck with he bill and screwed yet again. And the AG’s office is considered “law enforcement”, a sad joke on Americans.
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