And so it has come to pass..even the state Attorneys General are in the pocket of the TBTF financial institutions. The Attorneys General , on behalf of Fannie and Freddie, have ‘settled’ with the five biggest TBTF banks, for ‘future losses’ from the fraudulently written, fraudulently packaged, fraudulently rated and sold loans. Possibly the biggest fraud ever perpetrated will now, effectively, be swept under the rug in exchange for 1 or 2 cents on the dollar…I’d sure love a deal like that! (all emphasis, below, mine)
(Reuters) - The five largest mortgage loan servicers, including Bank of America Corp and JPMorgan Chase & Co, may be the first to settle with 50 state attorneys general who are investigating foreclosure practices, Bloomberg reported, citing Iowa Attorney General Tom Miller…
Ally Financial, Bank of America, Citigroup, JPMorgan and Wells Fargo could not be immediately reached for comment by Reuters outside regular U.S. business hours…
Here’s another report, below, from CnnMoney.com:
Is Fannie bailing out the banks?
Posted by Colin Barr January 3, 2011 10:11 pm
Financial stocks just caught fire. Someone must be getting bailed out, right?
Why yes, say critics of the giant banks. They charge that Monday's rally-stoking mortgage-putback deal between Bank of America (BAC) and Fannie Mae and Freddie Mac is nothing more than a backdoor bailout (QE4?) of the nation's largest lender (emphasis mine). It comes courtesy, they say, of an administration struggling to find a fix for the housing market while quaking at the prospect of another housing-fueled banking meltdown.
Monday's arrangement, according to this view, will keep the banks standing -- but leave taxpayers on the hook for an even bigger tab should a weak economic recovery falter. Sound familiar?…
And you don't need to be a conspiracy theorist to see that austerity talk in Congress means no more upfront support for financial firms. At a time of double-dipping house prices and nearly 10% unemployment, you can see where some people might find themselves devising new ways to prop up BofA and its housing-exposed rivals JPMorgan Chase (JPM), Wells Fargo (WFC) and Citi (C).
"This looks to me like a gift from Tim Geithner," said Chris Whalen of Institutional Risk Analytics. "There's politics all over this."…how sharp is Freddie if all it can do is squeeze a $1.28 billion payment out of a giant customer in exchange for relinquishing fraud claims on $117 billion worth of outstanding loans? The very best its million-dollar executives can do is claw back a penny on each bubbly subprime dollar?
…"How Freddie can justify this decision to settle 'all outstanding and potential' claims before any of the private-label putback lawsuits have been resolved is beyond comprehension," says Rebel Cole, a real estate and finance professor at DePaul University in Chicago. "This smells to high heaven and they should be called out."
Nice…
