Once again, the banks sold bad paper, in this case, credit card debts that they knew were not accurate and, and once again, Matt Taibbi has a distills the essence of the matter:

In a story that should be getting lots of attention, American Banker has released an excellent and disturbing exposé of J.P. Morgan Chase’s credit card services division, relying on multiple current and former Chase employees. One of them, Linda Almonte, is a whistleblower whom I’ve known since last September; I’m working on a recount of her story for my next book.

………

The Cliff’s Notes version of the story goes something like this: Late in 2009, Chase’s credit card services division sold a parcel of nearly $200 million worth of credit card judgments to a debt collector at a discount. This common practice in the credit-card industry is a little like a bookie selling the outstanding debts of his delinquent gamblers to a leg-breaker for 25 cents on the dollar. If the leg-breaker gets half the delinquents to pay, the deal works out for both sides — the bookie gets 25 percent of money he wasn’t going to collect, and the leg-breaker makes a 100 percent profit.

Only they did not do even the barest due diligence:

Linda [Almonte] subsequently found an enormous range of errors. Some judgments, she told me, were not judgments at all. In some cases, she said, Chase actually owed the customer money.

When she brought these concerns to her superiors, what do you think their response was? They told her and others to shut up and just sell the stuff anyway. Her boss, Jason Lazinbat, allegedly told her “she had better go along with the plan to sell the misrepresented asset.”

Think of the consequences of this: because Chase was so anxious to make money off this debt sale, countless credit card borrowers would now have collection agents chasing them for money they did not owe. The debt-buyer, too, was victimized by being sold accounts it could not collect on. It is almost impossible to estimate how many man-hours of pointless court proceedings would be lost because of this decision.

You know, this sounds familiar. Just like the foreclosure fraud.

In fact, it sounds like a pattern, a, “pattern of racketeering,” as in RICO, and the burden of proof in RICO, particularly for asset forfeiture, is not that high.

How about it, Barack?

It’s something that you can do in your 2^nd term, and you don’t need Congressional approval to do this.