You still have to have intent. I tend to think that the major majority of these fraudulent mortgages involved fraud from both the person preparing the paperwork and the person signing it, but I'm quite certain that in some cases the person didn't know what they were signing or what those numbers meant.
I do agree that this is one thing that people really should focus more on when it comes to the housing bubble/financial crisis, though. People all know that the various banks were committing massive fraud. (and they definitely were) People tend to forget all the fraud being engaged in by individuals.
What we do see is fines being levied against Wall Street, and large ones. But no jail time.
The problem with fines is that they act more like a toll for these firms rather than a real disincentive to stop driving where and when they want to. So the superhighway of fruad, questionable ethics, outright deceit and theft through financial schemes is still open, as long as you are big enough and can pony up enough dough to pay the toll.
And what the the employee told him to do was commit fraud.
Fraud deceives and is intended to deceive another so that the individual will act upon it to her or his legal injury. That means it takes more then just false information to be fraud, you have to be using that false information to deceive. If they were being told to put larger numbers then they were not deceiving, therefore not fraud.
You can be charged in federal court for mortgage or bank fraud:
- Even if the bank or mortgage company knew you were making a false statement
- Even if bank or mortgage company employees encouraged you to misrepresent the facts
- Even if 98 percent of the information on your application was accurate
- Even if your loan application was denied
Oh, bullshit. If your income is $30k and you put down $60K, I don't care if Christ himself told you to put that, YOU deceived. This "I'm not responsible for my own actions" drivel is getting old.Except intention was there as well. Only the bank executives have intent to defraud. Everyone else are following instructions they are given on how to fill out the loan forms.
Dude, Wall Street execs aren't Jewish (just like I'm not jewish).Oh, bullshit. If your income is $30k and you put down $60K, I don't care if Christ himself told you to put that, YOU deceived. This "I'm not responsible for my own actions" drivel is getting old. I don't see how we can prosecute the banks for following the same practices the GSEs demanded. I DO see some other things for which the banks can reasonably be prosecuted. Banks are not allowed to have captive appraisers. Some actual person made the decision to use an appraiser renting space from the bank using some legal fiction; prosecute that. If the bank's appraiser values a house at $300k and a month later values it at $600k, that seems actionable. And certainly when they realized they had made far more junk loans than the GSEs would or could buy and decided to make them into securities, their value was highly misrepresented; that just screams for prosecution. All those things are decisions made by individuals, and those individuals should be identifiable.
If two senators get their way, executives—and not just the banks they run—will face punishment for bad behavior in the future.
What's more, the sentiment is shared across party lines, with Sens. Elizabeth Warren , D-Mass., and Richard Shelby, R-Ala., both expressing concern that while banks have faced billions in penalties for actions that precipitated the financial crisis, no individual CEOs have been held responsible.
"No corporation can break the law unless the individual within that corporation broke the law," Warren said during a committee hearing Tuesday, according to an account in The Hill. "Not a single senior executive at these banks (has) been criminally prosecuted."
"Something's wrong with the Justice Department. People shouldn't be able to … buy their way out of culpability," Shelby added. "I agree with her on that."
"If you steal $100 on Main Street, you're probably going to jail," Warren said. "If you steal a billion bucks on Wall Street, you darn well better go to jail, too."