Yeah Baby !!! - 'New York Congressional Dems Support Schneiderman on Foreclosure Fraud Investigation

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New York Congressional Dems Support Schneiderman on Foreclosure Fraud Investigation
By: David Dayen - FDL
Tuesday August 30, 2011 6:50 am

Eric Schneiderman keeps picking up support in his quest to hold a real investigation on the criminal failures in mortgage securitization and servicing. He has the support of a number of newspaper editorial boards, including the St. Louis Post-Dispatch, which devoted its Sunday editorial to an out-of-state Attorney General:

Eric Schneiderman won’t play ball with efforts to make the mortgage foreclosure mess go away. In the spring, federal regulators thought they had a deal with Bank of America, Citigroup, JPMorgan Chase and Wells Fargo, the five biggest mortgage servicers, to settle claims that they had taken shortcuts by foreclosing on homes before the paperwork was properly processed. The banks would have paid about $20 billion, most of it for loan modifications and counseling.

But the banks wanted the 50 state attorneys general to sign off on the deal, too. The AGs have been meeting for months and were said to be close to an agreement. But Mr. Schneiderman is an outlier.

Good for him. The banks want this so-called “global agreement” to indemnify them against any mortgage-related claims, not just processing complaints. Mr. Schneiderman has been investigating the way that the banks securitized mortgages in the years leading up to the 2007-2008 housing collapse, cutting them into pieces and bundling them as mortgage-backed bonds.

If a random editorial board in St. Louis can get this exercised about Schneiderman’s work, you know his position has appeal. And the editorial showed a keen understanding of the issue.

Today, 20 Democrats in the New York Congressional delegation, including New Democratic Coalition leader Joseph Crowley, upstate moderates like Kathy Hochul and Bill Owens and DCCC chair Steve Israel, backed up Schneiderman and criticized Iowa AG Tom Miller for kicking Schneiderman off the executive committee negotiating with the banks. Led by Rep. Jerrold Nadler, their letter is targeted to Miller and parochial in nature, but adding their weight to Schneiderman’s concerns is important.

Link: http://news.firedoglake.com/2011/08/30/new-york-congressional-dems-support-schneiderman-on-foreclosure-fraud-investigation/

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Here’s the full letter from the New York Congressional Dem delegation:


August 30, 2011

The Honorable Tom Miller
Attorney General
1305 East Walnut Street
Des Moines, IA 50319

Dear Attorney General Miller:

As members of the New York congressional delegation, we are united in fighting for a fair resolution of the housing crisis that has devastated tens of thousands of families across our state. That is why we are deeply troubled by your recent action to silence New York’s voice by removing New York State Attorney General Eric Schneiderman from an executive committee negotiating a nationwide settlement with the banks. We ask that you explain how New York’s interests will be protected as negotiations move forward.

New York’s homeowners and investors have been hit hard by the economic impact of wrongdoing related to the mortgage crisis. According to the FBI, New York ranked as one of the top ten states for known or suspected mortgage fraud activity for two consecutive years. It also was one of the top ten states for reports of mortgage fraud across all originations in 2010. Undoubtedly, our state, the third largest in the nation, deserves a seat at any negotiating table that could potentially limit our state’s ability to investigate and penalize wrongdoing done within our borders.

Raising legitimate concerns about elements of the proposed settlement is a responsibility of every member of the executive committee and should never be the basis for silencing a viewpoint. Your removal of Attorney General Schneiderman sets a dangerous precedent for other attorneys general who, out of fear of what might happen, may choose silence over voicing valid concerns with particular aspects of the proposed settlement. Moreover, your attempt to banish opposition rather than address varying viewpoints undermines both the validity of the process and any settlement reached by the committee.

New York deserves adequate representation during the remainder of the mortgage settlement negotiations. We look forward to hearing how you will ensure that New York’s voice is heard.

Sincerely,

Jerrold Nadler
Carolyn Maloney
Maurice Hinchey
Joseph Crowley
Edolphus Towns
Carolyn McCarthy
Jose Serrano
Gary Ackerman
Timothy Bishop
Eliot Engel
Charles Rangel
Nita Lowey
Louise Slaughter
Paul Tonko
Gregory Meeks
Bill Owens
Yvette Clarke
Kathleen Hochul
Brian Higgins
Nydia Velazquez
Steve Israel

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