Obama created yet another “commission” to do the job another commission is already doing. However, Obama appointed Attorney General Eric Holder, who just happens to be tied to these banks who may have committed these mortgage fraud schemes.
WASHINGTON (Reuters) – The Justice Department issued civil subpoenas to 11 financial institutions as part of a new effort to investigate misconduct in the packaging and sale of home loans to investors, Attorney General Eric Holder said on Friday.
Holder declined to provide specifics, including the names of the firms.
“We are wasting no time in aggressively pursuing any and all leads,” Holder said at a news conference announcing details of a new working group to investigate misconduct in the residential mortgage-backed securities (RMBS) market, “you can expect more to follow.”
President Barack Obama said he directed Holder to create the new unit in his State of the Union speech late Tuesday, saying it was needed to “help turn the page on an era of recklessness.”
On Friday a slew of federal and state officials appeared at the news conference to provide details about the new group.
Housed within an earlier financial fraud task force that Obama created in 2009, it is expected to be staffed with around 50 attorneys, analysts and agents, officials said.
Two task forces?
Some skeptics have questioned whether the new group is largely a political move because the other fraud task force already exists.
Also, the Obama administration has received heat from left-leaning activist groups that believe a separate effort to investigate misconduct in processing foreclosures and servicing home loans may not be rigorous enough to extract a meaningful settlement.
In exchange for providing up to $25 billion in housing relief, much in the form of cutting mortgage debt for distressed borrowers, the top U.S. banks are expected to put behind them government lawsuits about lending and servicing abuses – but not securitization claims.
The banks involved in the discussions include Bank of America, Wells Fargo & Co, JPMorgan Chase & Co, Citigroup and Ally Financial Inc.