More Federal Help for Banksters So Soon?

One of the Republican Party’s prime constituencies, criminal Banksters, are in trouble.  In their greedy rush to strip mine the poor and middle classes through the housing bubble they created, they broke the law.  As they packaged bad loans into a variety of esoteric investments, they did not follow the required procedure for transferring deeds. Then they tried to cover up their crimes by using robo-signers to approve foreclosures.  They could lose billions.  You can be sure that they will be begging Congress to legalize their crimes retroactively, and that Republicans will be charging hard to aid them.

The Congressional Oversight Panel, the overseer of the government’s Wall Street bailout, in its latest report laid out a range of possible outcomes for the foreclosure paperwork mess that emerged in September.

In the best-case scenario, the watchdog said, concerns about the paperwork mess are "overblown" and banks would be able to proceed with foreclosures as soon as invalid court documents were replaced with proper paperwork.

But in the worst-case scenario, it warned that banks could face billions of dollars in losses.

Banks are accused of having used "robo-signers" to sign hundreds of foreclosure documents a day without proper review, a fiasco that reignited public anger with banks that received billions of dollars in taxpayer aid during the financial crisis.

Bank of America, Ally Financial and JPMorgan were among banks that temporarily suspended foreclosures pending internal reviews of their practices, but have since begun to resume sales of foreclosed properties.

In the worst-case scenario, the panel said banks may be unable to prove that they own the mortgage loans they claim to own, legal challenges could call into question the validity of 33 million mortgage loans — many of which were then securitized and sold to investors — and banks could face billions of dollars in unexpected losses.

"If such problems were to arise on a large scale, the housing market could experience even greater disruptions than have already occurred, resulting in significant harm to major financial institutions," the 125-page report said. "At present, the reach of these irregularities is unknown."

The panel, created to oversee the $700 billion bank rescue approved by Congress in 2008, also said banks could end up losing $52 billion from so-called mortgage put-backs, or loans that were sold to other investors but would have to be bought back due to problems that have turned up.

Those losses would be borne predominantly by Citigroup, JPMorgan Chase, Bank of America and Wells Fargo, the panel said… [emphasis added]

Inserted from <Reuters>

A friend of mine is directly involved in this.  When she applied for a mortgage adjustment, she was current in her house payments.  Her bankster advised her to stop making payments, telling her she had to be in default to qualify.  Since then she had faced a litany of lies, excuses, “loss” of paperwork she has sent on multiple occasions, etc.  Now she is in foreclosure and faces having her property seized any day.  She is no deadbeat, and I vouch for her impeccable integrity.

There are hearings about this subject on the hill today.  Banks must be held accountable for their criminal acts.  If they fail, so be it.  Nationalize them and distribute what’s left.  Under no circumstances may they be allowed to compound their criminal acts by helping banksters make them legal.