Alan Grayson on Mortgage Fraud (Lack of) Accountability: "President..Let These Crooks Off the Hook"
submitted to Zero Hedge by Tyler Durden
DYLAN: Couple of last questions and then I will let you go. One thing that came out in the FCIC report and Bill Greider did a great job of highlighting this — was the explicit introduction of known to be fraudulent mortgages. They have been audited by Clayton Holdings which is one of the bigger auditing firms if not the biggest auditing firms of these documents. They were knowingly and knowingly insofar as they had been reviewed by Clayton Holdings, then installed inside of investments and sold to pension funds, et cetera et cetera, where then the banks would go out and buy insurance on that that obviously paid a lot of money when the government stepped in to bail out AIG who was one of the big insurers.
How is it that after the Great Depression, there were blue sky laws that said it is illegal to sell a worthless piece of paper as if it is stock in the company if its just Alan Grayson and Dylan Ratigan have gone downtown with a piece of paper with their names on it and they are selling it for money even though there is actually no business. We created laws to prevent people from doing that sort of thing. And yet we found here that mortgages that have been deemed by some official authority — an auditor in this case — as nonconforming, will not get paid back, noncompliant with illegal investment standards for you, American pension fund, for you American mortgage buyer, Fannie Freddie etcetera, and then the FCIC comes out, shows that these fraudulent mortgages were being packaged and sold by Goldman, Deutsche, Morgan, the list goes on and yet, we have yet to see a single meaningful fraud investigation. I mean these guys makes Bernie Madoff look like Romper Room.
REP. GRAYSON: Well that’s right, and what it comes down to is they have been protected by one thing and one thing only which is prosecutor discretion. There is no doubt in a situation like that that people committed crimes, but in order to prosecute them for that you need to have a prosecutor who is willing to do it. And that is something that seems to have eluded us in the past, I guess, three years now. I am not only blaming the Obama administration, if the Bush administration had its head on straight they would have prevented a lot of these things from happening to start with.
But the President Obama administration said at the beginning, we are going to look forward and not back and therefore in the process of making that decision basically let these crooks off the hook.
DYLAN: And what does that sort of decision make, I call Obama the “turn the page president” whether it is war crimes, banking crimes or anything else, is there a point where the decision not to prosecute blatant crimes that are destructive to society really starts to breach the public trust with the government just because the President doesn’t really want to deal with the mess?
REP. GRAYSON: It’s actually worst than that. The same people who were committing fraud and crimes at Bear Stearns, they are now committing fraud and crimes at Bank of America, at Goldman Sachs and other institutions, because it turns out that crime does pay. It turns out that if you steal a large amount of money that leads to the collapse of your institutions, there’s jobs for you somewhere else.
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