He’s come out against the big banks and for New York Attorney General Eric Schneiderman:
New York state’s attorney general, Eric Schneiderman, is making national news regarding his opposition to a nationwide $20 billion foreclosure settlement involving some of the largest banks over questionable foreclosure practices and mortgage abuses.
While I didn’t support Schneiderman in the 2010 election, he deserves to be applauded for standing up to the big banks and some of the questionable practices that have attributed to America’s economic downturn.
Last Oct. 13, the attorneys general from all 50 states announced that they would join forces to investigate the bank foreclosure practices after there were several reports of faulty documents being used in the seizure of homes. Thirteen of the attorneys general serve on an executive committee, working with the Department of Justice and various other federal agencies to negotiate a settlement with the five largest mortgage servicers in the United States: Bank of America, JP Morgan Chase, Citigroup, Wells Fargo and Ally Financial.
Shaun Donovan, the secretary of housing and urban development, and other members of the Obama administration have been pressuring Schneiderman to go along with and support the settlement. It has been an intense campaign to change our attorney general’s mind.
Schneiderman has held his ground, and throughout the negotiations maintained the belief that the proposed $20 billion, which would mostly be designated to pay for loan modifications instead of going directly to Americans who were harmed by the banks’ practices, was not enough money. Also, if the banks and executive committee reached an agreement, it would prevent any further litigation or investigations against the large banks.
As a result of Schneiderman’s holdout, on Aug. 24 it was reported that he was “removed from a leadership role in negotiating a nationwide foreclosure settlement with U.S. banks.”
Iowa Attorney General Tom Miller, who is heading the executive committee, accused Schneiderman of “actively working to undermine the very same multistate group that it had spent the previous nine months working very closely with.”Bravo, Mr. Attorney General!
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By pressuring the attorneys general’s executive committee to pass this fruitless proposal, President Obama and his administration are allowing the big banks, generous campaign contributors, to once again get away unscathed for their chancy and untrustworthy practices. In times like these, we need leaders like Schneiderman to challenge the big banks, making sure that victims receive justice and restitution and that overall reform changes the mortgage industry.
To allow a settlement to be reached that hinders future investigations into large banks’ foreclosure and mortgage practices is criminal. Fight on, Mr. Attorney General.
I don’t think that Mr. D’Amato’s motives are completely benign: As a Republican, he has vested interest in criticizing the Obama administration, and has never been particularly interested in pursuing corruption.
What he does know is how to pander to his constituents, and he clearly sees the enthusiastic embrace of Wall Street, and explicit toleration of its endemic corruption, by the Obama administration to be a political miss-step.
I agree, and I would further add that it’s also good policy, as we are creating moral hazard by not prosecuting the banksters.