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The government did indeed sentence one person to mortgage fraud for inflating his income (a so-called, "liar loan"). This person is now serving a 21 month sent

The government did indeed sentence one person to mortgage fraud for inflating his income (a so-called, "liar loan"). This person is now serving a 21 month sentence: http://www.nytimes.com/2011/03/26/business/26nocera.html?pagewanted=all http://www.nytimes.com/2011/03/26/business/26nocera.html?pag... What about the bank that encouraged the home buyer to inflate or falsify their incomes? So far at least, they've largely escaped consequences for their pattern of encouraging fraud and shirking on their due diligence.

yummyfajitas 15y ago
Most of the banks which encouraged/looked the other way on liars loans (e.g., Wachovia) no longer exist. How is that "escaping consequences"?
- crag 15y ago
  Because those "filed" banks didn't die, They merged. JP Morgan picked up Bear in a fire sale, for a billion. Bear's Office building in NYC was worth more. Lehman went bankrupt.. but our government (us taxpayers) had to eat the mortgages in order for other banks to buy Lehman's assets. The banks just moved the money from A to B. BofA picked up Merrill for peanuts. Wachovia was picked up by Well Fargo. Another fire sale. And who lost out? Us taxpayers, and the employees. Mostly the back office staff. Most of the traders kept their jobs (and bonuses). And the executies made billions in buyouts, parachutes and stock transactions.
  - true_religion 15y ago
    I'd say the stock holders lost, and that's supposedly who owns and runs the company so they're the ones who should lose.
- MaysonL 15y ago
  What is Angelo Mozilo's net worth? Have any of the bankers involved in any of the frauds gone to jail?
  - crag 15y ago
    About $500 million. Not counting clubs, his planes, cars, houses, etc, etc. he was fined by the SEC for $65 million and barred from ever being a CEO of a public company. He is not in jail. Also Countrywide is on the hook for 15 of that 65 million fine. That was part of his agreement with the company. And he didn't have to admit "wrong doing". The criminal case against him has been dropped. Again, he's not in jail. And no, no one is in jail AFAIK.
    - lawnchair_larry 15y ago
      Over drinks at a bar on a dreary, snowy night in Washington this past month, a former Senate investigator laughed as he polished off his beer. "Everything's fucked up, and nobody goes to jail," he said. "That's your whole story right there. Hell, you don't even have to write the rest of it. Just write that." http://www.rollingstone.com/politics/news/why-isnt-wall-street-in-jail-20110216 http://www.rollingstone.com/politics/news/why-isnt-wall-stre...
      - crag 15y ago
        That was a great read. Thanks for the link.

yummyfajitas 15y ago

Most of the banks which encouraged/looked the other way on liars loans (e.g., Wachovia) no longer exist. How is that "escaping consequences"?

crag 15y ago
Because those "filed" banks didn't die, They merged. JP Morgan picked up Bear in a fire sale, for a billion. Bear's Office building in NYC was worth more. Lehman went bankrupt.. but our government (us taxpayers) had to eat the mortgages in order for other banks to buy Lehman's assets. The banks just moved the money from A to B. BofA picked up Merrill for peanuts. Wachovia was picked up by Well Fargo. Another fire sale. And who lost out? Us taxpayers, and the employees. Mostly the back office staff. Most of the traders kept their jobs (and bonuses). And the executies made billions in buyouts, parachutes and stock transactions.
- true_religion 15y ago
  I'd say the stock holders lost, and that's supposedly who owns and runs the company so they're the ones who should lose.
MaysonL 15y ago
What is Angelo Mozilo's net worth? Have any of the bankers involved in any of the frauds gone to jail?
- crag 15y ago
  About $500 million. Not counting clubs, his planes, cars, houses, etc, etc. he was fined by the SEC for $65 million and barred from ever being a CEO of a public company. He is not in jail. Also Countrywide is on the hook for 15 of that 65 million fine. That was part of his agreement with the company. And he didn't have to admit "wrong doing". The criminal case against him has been dropped. Again, he's not in jail. And no, no one is in jail AFAIK.
  - lawnchair_larry 15y ago
    Over drinks at a bar on a dreary, snowy night in Washington this past month, a former Senate investigator laughed as he polished off his beer. "Everything's fucked up, and nobody goes to jail," he said. "That's your whole story right there. Hell, you don't even have to write the rest of it. Just write that." http://www.rollingstone.com/politics/news/why-isnt-wall-street-in-jail-20110216 http://www.rollingstone.com/politics/news/why-isnt-wall-stre...
    - crag 15y ago
      That was a great read. Thanks for the link.