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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsAstroturf works in the service of Wall Street
Last edited Sat Jan 28, 2012, 07:41 PM - Edit history (2)
This post is to call out your DU attention to the Center for Responsible Lending.
The organization came out in favor of the Administration settling the Robo-Signing scandal with the Big Banks.
Consumer group tentatively supports $25-billion mortgage deal
AG Settlement: Not Perfect, but Significant Reform of Mortgage Servicing
The news was posted on DU.
In researching the "not-for-profit organization," I discovered the founders and principle funders of the Center for Responsible Lending, Herb and Marion Sandler, made great profits -- legally -- through the Savings & Loan and banking industries. They both are old-fashioned, Liberal Democrats from the Democratic Wing of the Democratic Party -- the kind I identify with. That said, it's important to know they got out of the home mortgage game at just the right moment:
Wachovias Golden West Deal Turns to Bronze
WSJ Blog Deals
January 22, 2008, 1:50 PM
By Dana Cimilluca
Depending on how you look at it, it was either one of the best- or the worst-timed M&A deals of all time.
We are talking about Wachovias $24 billion acquisition of California mortgage lender Golden West Financial. The deal was announced in early May 2006. Its close, five months later, coincided almost perfectly with the peak in the U.S. home-lending market, a fact made all-to-clear by Wachovias 98% fourth-quarter earnings decline, announced today.
The woes that have halved the share price of its larger rival, Citigroup, have diverted attention away from the dismal performance of Wachovias stock. But of the four largest U.S. banks Citi, J.P. Morgan Chase, BofA and Wachovia only Citigroups stock has performed worse than has Wachovias since the Golden West deal closed. The 44% decline in Wachovias stock since then has knocked nearly $50 billion off its market cap.
SNIP...
But on Wall Street, of course, someones loss is always anothers gain. In this case, Herbert and Marion Sandler must be congratulated not only for building Golden West into a financial colossus, but for their impeccable timing in selling it. The deal valued the husband-and-wife teams stakes at $2.4 billion. But alas, they remain big Wachovia shareholders.
CONTINUED...
The people who can afford to play this Corporate McPravda Astroturf game are of the same class who get paid by the system.
Bottom Line: Do not support this quick settlement, as it's nothing more than welfare for Wall Street.
sabrina 1
(62,325 posts)nearly destroyed this country. I have no idea why it is even being discussed.
Octafish
(55,745 posts)For example:
JPMorgan Chase Agrees to $228 Million Settlement in Muni Bid Rigging Case
A quick GOOGLE of JPMorgan Chase + Justice Department Settlement yields all manner of perfidy. Yet, that class of citizen is exempt from prosecution.
sabrina 1
(62,325 posts)when the law does not apply equally across the board and the wealthy can use the bribery of our government to get their 'get out of jail free' cards.
It makes a mockery of the claim that we are a nation of laws. And it is despicable that it has apparently gone on for so long.
Luminous Animal
(27,310 posts)I'd view this information with a ton of salt.
sabrina 1
(62,325 posts)I am a bit confused. I checked the link to the DU OP which led to the organization you are talking about? I understood this OP was warning about not taking their support for the Bank Bailout too seriously, which is what it is as far as I can tell, because they were a questionable site?
I admit, I'm in the middle of a work project and haven't gone back to look again and will do so later when I have time. But am I mis-understanding something?
Luminous Animal
(27,310 posts)"radical left-wing activist groups such as the Association of Community Organizers for Reform Now (ACORN)."
ActivistCash targets primarily liberal foundations and those who run them.
T S Justly
(884 posts)Octafish
(55,745 posts)Luminous Animal
(27,310 posts)What the hell! I think you need to reread the entire entry in your link....
Octafish
(55,745 posts)I went by what they wrote in regards to the Center for Responsible Lending, which was started by the very nice people who made billions off of Adjustable Rate Mortgages.
25 People to Blame for the Financial Crisis
Luminous Animal
(27,310 posts)More info about Center for Responsible Lending...
http://en.wikipedia.org/wiki/Center_for_Consumer_Freedom
The CCF operates a number of other websites aside from its own, including PhysicianScam.com, Trans-FatFacts.com, Animalscam.com, Obesitymyths.com, and CSPIScam.com. MercuryFacts.com and FishScam.com contain a mercury calculator that offers an alternative calculation of amount of a fish that can be eaten before getting an unsafe dose of mercury, calculated as ten times the reference dose recommended by the EPA.
The CCF has also claimed (counter to research findings) that dieting and meal tracking do not lead to weight loss,[26] and it has been a critic of United Auto Workers,[27] and the American Federation of Teachers,[28] among others.
Octafish
(55,745 posts)That makes me a moron.
OTOH, what they said about the billionaires behind the Center for Responsible Lending is true.
Luminous Animal
(27,310 posts)The ARMs that the Sandlers bank promoted were the most stable ones offered with the interest increasing gradually over 10 years...
http://www.cjr.org/feature/the_education_of_herb_and_marion.php?page=all
....
In the early 2000s, a new wave of option ARMs entered the market. Generally marketed to borrowers with subprime credit scores, the loans shared the Pick-a-Pay characteristics of allowing the borrowers to choose their payment for a period of time, run up some degree of negative amortization, and then recast to a fixed-rate mortgage. But that was where their resemblance to Golden Wests product ended.
While Golden Wests minimum payments were designed to rise gradually over a decade, the option period in this new wave of loans was often no more than a few years, guaranteeing a massive jump in payments when the loan recast. Instead of cushioning borrowers against interest-rate hikes, the teaser rates just let them temporarily make payments on homes they couldnt afford.
Meanwhile, entities like New Century and Countrywide had no stake in the loans after they wrote them. When investment banks opened a new market by securitizing the first option ARMs in the 1990s, the Sandlers were horrified. Golden Wests business model was premised on the idea that option ARMs required meticulous underwriting and monitoring. By packaging and selling such loans as securities to investors, its rivals dispensed with the obligation to do either.
Octafish
(55,745 posts)Luminous Animal
(27,310 posts)Octafish
(55,745 posts)Progressive. Liberal. Enterprising. Quiet.
What Do Herbert and Marion Sandler Want?
Investigating the funders of ProPublica, the new investigative journalism outfit.
By Jack Shafer|Posted Monday, Oct. 15, 2007, at 10:45 PM ET
Slate.com
EXCERPT...
What do the Sandlers want for their millions? Perhaps to return us to the days of the partisan press. The couple made their fortune, which Forbes estimates at $1.2 billion, at Golden West Financial Corp. In recent years, they've spent millions on politics. The Federal Election Commission database shows the two of them giving hundreds of thousands of dollars to Democratic Party campaigns. In 2004, Herbert Sandler gave the MoveOn.org Voter Fund $2.5 million, again according to the FEC database. The Center for Responsive Politics Web site reports donations of $8.5 million from Herbert and Marion to the 527 group Citizens for a Strong Senate, in the 2004 cycle. CSS was formed by "a group of strategists with close ties to former North Carolina Sen. John Edwards," writes the washingtonpost.com's Chris Cillizza. American Banker reported in 2005 that Herbert also gave $1 million to the California stem cell initiative and that the pair have also funded the progressive Center for American Progress.
The Sandlers' enthusiasm for journalism and journalists is late in arriving. Back in April 1992, at the American Society of Newspaper Editors' annual convention, Marion ascribed partial blame for the savings and loan disaster to the press. "Where were you when it was happening?" she asked, according to a story by the Chicago Tribune's James Warren. Her husband accused the press of making "stars out of bums and charlatans" like swindler Charles Keating. "The press is susceptible to the Big Lie, no matter how patently nonsensical," Herbert said.
What sort of assistance did the Sandlers give the press to get to the bottom of the S&L scandal while it was happening? Um, not much. Warren writes, "Herbert Sandler conceded that, apart from being an occasional anonymous source for one Wall Street Journal reporter, he declined to help journalists as much as he probably should have."
CONTINUED...
The Savings and Loan crisis is a subject near and dear to me. It's been my experience that the FSLIC bailout of the early 90s was a practice-run for the great Wall Street bailout of 2008-2012.
Luminous Animal
(27,310 posts)How about, MADD, the Sierra Club, Acorn, Green Peace. Are they also astro-turf "companies"? Those are the types of organizations that that ActivistCash goes after.
Octafish
(55,745 posts)From what I know, the Sandlers became very wealthy, thanks in large part to the growth of their savings and loan morphing into a bank. The organization they helped found and finance thinks it's a good deal to wrap up all the pesky robo-signing lawsuits.
Please don't get mad, but I don't think that's a good idea, putting the past behind us.
Luminous Animal
(27,310 posts)No more robo-signing. Banks would agree that key foreclosure documents will be individually reviewed as required by law.
End of many servicing abuses. The banks would agree to adopt many practices that will result in better communication, fewer delays, and fairer treatment for homeowners who are late on house payments.
More sustainable loan modifications. The settlement would require banks to get serious about reducing the principal balances on mortgages for struggling homeowners, possibly preventing hundreds of thousands of unnecessary foreclosures.
Banks remain accountable. While the state AGs would not be able to bring additional origination or servicing claims against the participating banks, the settlement would preserve the ability of homeowners to pursue claims against banks. Moreover, the settlement would not shield banks from prosecution related to criminal activities, claims based on mortgage securities violations, fair lending suits, or claims against MERS. Finally, the settlement would be enforceable in court by an independent monitor.
T S Justly
(884 posts)And, there is the possibility the Sandlers do good work to cover for questionable financial dealings. After
all, the "philanthropic" Rockefeller handed out dimes to mere mortals after illicitly destroying the lives
of competitors.
Luminous Animal
(27,310 posts)And I think some of what we know about the bank deal is crap but I don't think it is wise to smear Democrats, even rich ones, by using info supplied by right-wing sites..
Here is a NY Times profile of the couple:
http://www.nytimes.com/2008/03/09/magazine/09Sandlers-t.html?pagewanted=all
Here is a Columbia Journalism Review which addresses some of the claims by ActivismCash.com
http://www.cjr.org/feature/the_education_of_herb_and_marion.php?page=all
Octafish
(55,745 posts)If so, I will.
Luminous Animal
(27,310 posts)Ultimately, we are our own moral agents.
Octafish
(55,745 posts)For a more leftward POV than in the original OP:
Vile People
Herb Sandler
Herb Sandler is an American banker infamous for inventing the Adjustable Rate Mortgage. Together with his wife Marion Sandler, he purchased Golden West Savings and Loan in 1963 and created Golden West Financial Corp, the parent company of World Savings Bank.
World Savings was once one of the largest S&Ls in the US with assets of almost $80 billion, deposits of $46 billion, and 9,300 employees. Under the Sandlers' management, Golden West generated a 20 percent average annual compound growth over a 35 year period. This prompted Jason Jennings, author of Less is More, to describe their company as "one of the most efficient and productive money machines on the planet". Prior to 2003, Golden West was voted the nation's most admired savings institution seven times in Fortune magazine's annual list of the nation's most admired companies.
SNIP...
Golden West was sold in 2006 for $24 billion to Wachovia Bank. The merger was completed in October 2006. The Sandlers owned about 10% of the company at the time of the sale, making their share of the sale price worth about $2.4 billion.
SNIP...
The Sandlers sold their firm at the top of the market, saying that they were growing older and wanted to devote themselves to philanthropy. A year earlier, in 2005, World Savings lending had started to slow, after more than quadrupling since 1998.
CONTINUED...
http://thevileplutocrat.com/bile/profile/herb_sandler/
A bit of background from my perspective:
Pete Brewton's book, "The Mafia, CIA and George Bush," is a must-own for those interested in the workings of the Bush Organized Crime Family. Written by a former Houston Post reporter, the book documents, literally, the way the Mafia, the CIA and those connected and related to George Poppy Bush looted more than 1,000 of the nation's Savings and Loans institutions and pretty much got away with it, scot-free.
http://www.ringnebula.com/project-censored/1976-1992/1990/1990-story3.htm
One way the crooks did it was to get a person inside the S&Ls to make high-risk commercial loans for imaginary projects that would go nowhere. It could be a mega-automall construction project or a new high-rise condo. Collateral could be something as flimsy as a Xeroxed deed with the real owner's name covered by White-Out.
The newly hired S&L commercial lending officer wrote up a check and handed it over for a cool $6.5 million, say. Then, before even one shovel of dirt gets turned, the loanee goes bankrupt and POOF goes the $6.5 million.
Before it can be retrieved, the money was offshore and the bankruptee went on with his or her life as normal. The crooks behind them had additional, tax-free revenue. Crooks were affiliated with both major political parties, independents, and the apolitical. They all shared a deep, abiding interest in money and a passion for its collection.
This happened in Pontiac, Michigan in 1989. I know this for a fact, as I was one of the few reporters covering the story.
Brewton's book is a terribly difficult read, because of the complex nature of the myriad criminal and social relationships surrounding the S&Ls, money laundering, black ops, and Big Oil. While this doesn't make it an easy to follow, Hansel-and-Gretel-bread-crumbs-through-the-forest story, the trail leads to the corrupt chambers holding those at the top of the nation's power and financial structures.
Thank you for the heads-up and for pointing out my mistake, Luminous Animal. It is a moral matter.
T S Justly
(884 posts)From receiving another K&R.