... Is the Fix In?
This is Part 2 of 4 Parts. Part 1 was posted on Insurance Claims and Issues Weblog on Monday, January 30, 2012.
The Federally fashioned Residential Mortgage-Backed Securities Working Group has come into being seemingly independent of the settlement talks addressing "Mortgage Fraud" by Mortgage Servicers. As noted in Part 1, the other side of those talks has been occupied by a diminishing group of State Attorneys General while the settlement under discussion has expanded. The Mortgage Servicers, all Banks, want desperately to form a 'global settlement' that would settle all their exposure in the Great Finanicial Fiasco -- even if, especially if, the Banks' activities have not been fully investigated.
The RMBS Working Group is not seemingly independent of the Federal Government, however.
The Working Group has been placed under the leadership of a Task Force headed by Attorney General Eric Holder, as noted in Part 1.
HUD Secretary SHAUN DONOVAN was prominently featured in photographs released of the announcement of this new Working Group to the press. As was also noted in Part 1, Mr. DONOVAN has reportedly been in charge of Administration efforts to apply "pressure" on the State Attorneys General who remain in the ongoing settlement talks with the Mortgage Servicers-Banks, to settle. HUD is part of the new Working Group too. Edward Wyatt, "New Fraud Investigation Group Issues Subpoenas to Financial Companies" p. B3, col. 1 (New York Times Nat'l ed., "Business" Section, Saturday, January 28, 2012).
One of at least five (5) "Co-Chairs" is now the New York Attorney General, Eric Schneider. See, e.g., "New Residential Mortgage-Backed Securities Working Group Hopes to Restore America's Trust in Financial Sector," Securities Law Prof Blog, posted January 27, 2012; Edward Wyatt, New York Times, supra.
The five "Co-Chairs" to run the new Working Group are:
- General Schneiderman of New York State;
- Lanny Breuer, Assistant A.G., DOJ;
- Robert Khuzami, "enforcement director," SEC*;
- Tony West, another Assistant A.G., DOJ; and
- John Walsh, U.S. Attorney, District of Colorado.**
*This is the person who reportedly stated that an SEC settlement is as good as a judgment. See Part 1 of this series.
**The appointment of the U.S. Attorney for the District of Colorado to this Working Group, is a puzzle. Why was this presumably fine lawyer actually selected for this particular Working Group involving Fraud in Residential Mortgage-Backed Securities? The website for the U.S. Attorney, District of Colorado, displays his "Community Service Projects"; none involve Mortgages, Residences, Securities, or even Foreclosures. His website also lists all of his press releases, and the first press release related to RMBS Fraud is his press release announcing that he has been named a Co-Chair of the RMBS Working Group. See for yourself: Website of the U.S. Attorney for the District of Colorado.
The Working Group will be staffed by 55 employees of the Federal Government including "attorneys, analysts, agents and investigators." Press Release of the New York Attorney General, January 27, 2012, "A.G. Schneiderman and Federal Officials Detail Joint Investigation Into Mortgage Crisis".
This is the end of Part 2. Part 3 in this series will resume tomorrow, on Insurance Claims and Issues Weblog.
Please Read The Disclaimer.
Comments