Daily Nonsense

As our Attorney General, Michael Mukasey, continues to insist, there is no reason to imagine that the sub-prime mortgage problems will result in the same level of global crisis that the Enron scandal did just seven years ago.  Mukasey has gone on record as saying that "…he did not feel the mortgage crisis warranted the same sort of response the Department of Justice mustered to Enron’s collapse in 2002, when the DOJ formed a national task force to investigate the collapse of the energy industry titan."

If that is truly the case, he should have mentioned something it to his staff.  US News & World Report has reported in it’s daily political bulletin that more than 400 individuals have been arrested in the past couple of days for mortgage fraud charges.  This number includes two Bear Sterns executives who were charged with lying to investors about the collapse of the sub-prime mortgage market.

I wonder if the DoJ and the FBI are colluding behind the back of their titular chief to investigate, arrest and prosecute these crooks because they know the wind is going to change come January 20, 2009?  If that is the case, if these people involved in bringing justice back to the Justice Department are going against the flow because it’s the right thing to do, they really need to be applauded.   Well done!

Mortgage Fraud Crackdown Nets 406 Arrests 

Yesterday’s announcement that over 400 people have been arrested in a national mortgage fraud crackdown dubbed "Operation Malicious Mortgage" is covered widely in this morning’s papers. The networks also covered the story, combining their reports on mortgage fraud with their coverage of the arrests of two former Bear Stearns executives on charges relating to misleading investors regarding the health of the subprime credit market earlier this year.

NBC Nightly News reported, "Federal agents revealed today they’d rounded up more than 400 people since March, charged with mortgage fraud, cheating individual homeowners and banks with, for example, phony foreclosure rescue schemes." The CBS Evening News reported, "The mortgage fraud charges run the gamut, from phony bankruptcies and foreclosure schemes, to bogus applications and builder kickbacks. And no corner of the nation was untouched, as scammers coast to coast sought to cash in on an overheated real estate market."

ABC World News reported, "Justice Department officials say the massive fraud extends from Wall Street to Main Street. The 400 arrests announced today are part of a broad effort, with investigations in every FBI field office in the country." The AP reports, "The FBI put the losses to homeowners and other borrowers who were victims in the schemes at over $1 billion."

According to the New York Times, "The FBI has more than 40 task forces around the country that are working with other federal, state and local law enforcement agencies on mortgage fraud issues. Its caseload has nearly doubled in the last three years, from 721 mortgage fraud cases in 2005 to more than 1,400 cases that are currently pending."

[Thanks, US News & World Report]