Oh, it wouldn’t be so hard to convince a jury…once you inform the jury that the investors were primarily pension funds that had pertinent criteria for investing: (1) the investments must be liquid, and (2) the bond investments must be rated Triple A. In order to be liquid, defaults and refinances must occur so underwriting guidelines were significantly relaxed (FUND ‘EM) on purpose to fill the trusts with loans that would likely default and insurance would payoff. When loans did not default quick enough, more credit and refinances were offered (dangled) with refined sales pitches encouraging the homeowner to take on more debt for a short period of time in order to get a better interest rate and 30 year fixed loan. These sales pitches were so perfected and convincing that homeowners didn’t even question or maybe they would have found out that they were actually participating in a Wall Street securities scheme.
The bonds were erroneously rated Triple A when there was no way they were anywhere near Triple A – that issue has been well documented by numerous lawsuits against the rating companies. It appears no one took the time to see if the actual loan documents had been timely assigned to the trusts, either because they were in on it and knew that they had not been assigned – or the regulators, insurance and rating companies were negligent idiots.
Show the jury the patents created by Fannie and the banks, explain the scheme and bring in several dozen homeowners from around the country and when they all start telling the same story – the pieces of the puzzle fit like a glove. It shouldn’t be very hard to convince a jury – just take a look at the multi-million dollar awards homeowners have been given once they do finally make it to a jury trial.
The Tea Party regards Barack Obama as a kind of devil figure, but when it comes to hunting down the fraudsters responsible for the economic disaster of the last six years, his administration has stuck pretty close to the Tea Party script. The initial conservative reaction to the disaster, you will recall, was to blame the crisis on the people at the bottom,
on minorities and proletarians lost in an orgy of financial misbehavior. Sure enough, when taking on ordinary people who got loans during the real-estate bubble, the president’s Department of Justice has shown admirable devotion to duty, filing hundreds of mortgage-fraud cases against small-timers.
But high-ranking financiers? Obama’s Department of Justice has thus far shown virtually no interest in holding leading bankers criminally accountable for what went on in the last decade. That is ruled out not only by the Too Big to Jail doctrine that top-ranking…
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