Has Obama's Foreclosure Settlement Worked?

Is Obama's Foreclosure Settlement Working?
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U.S. President Barack Obama attends the East Asian Summit Plenary Session at the Peace Palace in Phnom Penh, Cambodia, Tuesday, Nov. 20, 2012. (AP Photo/Carolyn Kaster)
U.S. President Barack Obama attends the East Asian Summit Plenary Session at the Peace Palace in Phnom Penh, Cambodia, Tuesday, Nov. 20, 2012. (AP Photo/Carolyn Kaster)

On November 19th, the core of the Obama "Justice" Department's "49 State Settlement," of the millions of fraud claims by the suing mortgagees against the mega-banks who were trying to foreclose on robo-signed and other dubious mortgages, was finally announced, and it basically gave the mega-banks what they wanted: all of the money they could possibly get out of those mortgagees, and with future U.S. taxpayers furthermore absorbing the resulting losses, in the form of taxpayers needing to pay off the federal debt for the massive bailouts of Wall Street and its "counter-parties," losses which were being absorbed by Timothy Geithner's U.S. Treasury, and by Ben Bernanke's U.S. Federal Reserve. There would be no prosecutions of mega-bank executives for any of the frauds those mega-bank executives had planned and overseen, which had led to these enormous crimes, and thus to the 2008 crash. Those mega-bank executives were permitted to keep their millions of dollars in pay and bonuses, which they had earned from these frauds.

In order to understand what was happening here, one needs to know first this relevant background, the back-story:

The Huffington Post headlined on 25 February 2011, "Homeowners Demand Criminal Prosecutions," and Zach Carter reported that 50 state attorneys general were "currently hashing out plans for a multibillion-dollar settlement with some of the nation's largest banks over alleged mortgage abuses," but, "There is no indication that [criminal] charges will be filed under the deal currently being negotiated. By contrast, more than 1,100 bankers went to jail after the savings-and-loan crisis of the late 1980s and early 1990s. Because regulatory fines [such as Obama was pushing for, to substitute for criminal prosecutions of individuals] are typically levied against institutions rather than key decision-makers accused of wrongdoing, consumer advocates view them as a relatively weak deterrent against future abuses." Obama, and also the conservative Democrat Tom Miller, who was the chief state Atorney General on this matter, were looking to protect the aristocracy. This would cheat outside investors, who had been defrauded by those aristocrats' rotten mortgage-backed securities (MBS), and it would also cheat people whose homes had been foreclosed despite their having been current on their mortgage payments, and (in some cases) despite their home not even having any mortgage on it at all - just fraudulent foreclosures, which were rampant. No matter how brazen the aristocrats' crimes had been, Obama and Tom Miller were evidently determined to protect them, not to prosecute them. Obama had thought that a mere $8.5 billion settlement with Bank of America (which had absorbed Angelo Mozilo's corrupt Countrywide Mortgage) would satisfy outside investors who had been robbed of hundreds of billions. The Obama-Miller deal included immunity from other claims and prosecutions. However, the New York State AG, Eric Schneiderman (with an assist from Delaware's AG, Beau Biden, son of the VP), was blocking the aristocrats' settlement; and, on 23 August 2011, the Washington Post headlined "N.Y. Bumped from 50-State Foreclosure Committee," and reported: "Iowa Attorney General Tom Miller, who is leading foreclosure settlement negotiations with the nation's largest banks on behalf of all 50 states, abruptly removed New York Attorney General Eric Schneiderman from the coalition's executive committee." Nothing was said here about the Obama Administration's desperate efforts against Schneiderman on this matter. The idea in this news report was instead to cover up for the aristocracy, and for its agents. Then, on 29 August 2011, Yves Smith headlined at her nakedcapitalism.com, "FDIC Objects to $8.5 Billion BofA Settlement," and posted the courageous Sheila Bair's repudiation of her boss's, Barack Obama's, deal with BOA. Perhaps Obama stood now so low in the public's approval-ratings, so that he politically couldn't afford to fire her. A rebellion was now afoot, and Obama needed to strain hard in order to keep on with his war against the public, on behalf of the aristocracy.

Rolling Stone wasn't considered a major news medium, but merely an entertainment magazine, so aristocrats had little interest in controlling it. The 3 March 2011 issue headlined, "Why Isn't Wall Street In Jail? ... The Feds Are Doing More to Protect Them than to Prosecute Them." Matt Taibbi presented there a succession of stories about obstruction of justice by the Obama Administration, at least as bad as during the Bush Administration. "In the past few years, the administration has allocated massive amounts of federal resources to catching wrongdoers - of a certain type. Last year, the government deported 393,000 people, at a cost of $5 billion. ... Illegal immigrants: 393,000. ... Bankers: zero. ... You want to win elections, you bang on the jailable class. You build prisons and fill them with people for selling dime bags and stealing CD players. But for stealing a billion dollars. For fraud that puts a million people into foreclosure? Pass." Taibbi told stories of federal prosecutors who had been fired for wanting to investigate top executives of Morgan Stanley, etc., and of other federal prosecutors who had quit the federal service to work for Morgan Stanley, etc. (at far higher pay, and, now, higher prestige as well). However, Obama could accept federal investigation of Angelo Mozilo of Countrywide Financial, who sold to Wall Street instead of having been part of Wall Street. But even that investigation was aborted. On February 18th of 2011, the Los Angeles Times had bannered "U.S. Drops Criminal Probe of Former Countrywide Chief Angelo Mozilo," and reported that, "Federal prosecutors have shelved a criminal investigation of Angelo R. Mozilo after determining that his actions in the mortgage meltdown ... did not amount to criminal wrongdoing." The Obama Administration refused to continue its investigation of Mozilo's case, because, supposedly, everyone was guilty, and so no one was - Mozilo had committed no crime, even though the SEC found that Mozilo had admitted in a private communication during the lead-up to the mortgage-meltdown, in 2006, "In all my years in the business, I have never seen a more toxic" investment product than what his firm was at that time passing off to Wall Street for securitization and sale to outside investors. The idea that guilt was collective, not individual, hadn't been accepted at the Nuremberg International War Crimes Tribunal, but it was being accepted now by Barack Obama and his stooge Eric Holder, though only for white-collar crimes like this, not for crimes committed by lower-class crooks (whose guilt Obama readily accepted as being individual). The real reason the Mozilo investigation was dropped is that Obama didn't want his Wall Street friends to be prosecuted, and there would be no way of preventing their prosecutions if Mozilo's case went to court. Obama didn't necessarily care about Mozilo. (Though on 4 March 2011, Matt Stoller had headlined "Angelo Mozilo, Tea Partier?" and revealed a 1 September 2004 e-mail from Mozilo to other executives at Countrywide, in which Mozilo had said, "The upcoming election has exacerbated my concerns in that a Kerry win could cause a serious disruption in the economy if he is successful in rolling back a substantial portion of the tax breaks initiated by Bush. It is the wage earners $200,000 and over that are the drivers of the economy and that is the group that Kerry has stated he will attack." Obama was thus not doing a favor for a friend here, but rather a favor for a very conservative Republican, whose business-model was to exploit the non-rich, and whose basic economic belief was that the richest 1.8% of Americans "are the drivers of the economy." Obama was a closeted conservative.)

On 25 January 2012, David Dayen at firedoglake.com bannered "The Schneiderman Gambit: Financial Fraud Unit Appears Designed to Fail," and he quoted from the praises that liberals had just heaped upon Obama for his appointing N.Y. Attorney General Eric Schneiderman to be the co-chair of a new Unit on Mortgage Origination and Securitization Abuses, under the President's existing Financial Fraud Task Force, which was under Lanny Breuer, under Eric Holder, in Obama's bankster-protecting "Justice" Department. Besides Breuer, another member of this fraudulent Financial Fraud Unit was Robert Khuzami, of the SEC, who had already been condemned by Judge Jed Rakoff and others for trying to settle "slap on the wrist" fines against Citibank, B of A, and Goldman Sachs, for bankster crimes. Another member of this Unit was the brother-in-law of Kamala Harris - the California A.G. who had joined Schneiderman's break away from the Obama-led effort to reach a 50-state wrist-slap settlement of all claims against the banks. Obama was thus setting Ms. Harris against her brother-in-law, in an attempt to separate, from her-and-Schneiderman's prosecute-the-banksters brigade, its most potent single member (Harris being the A.G. of the biggest state, and of the state that had suffered the most from banksters' crimes). Dayen thus explained how Obama was relying upon the faith of liberals, so as to destroy what had been the effort by Schneiderman, Harris, and the few other Democratic state A.G.'s who were trying to resist Obama's bankster-protection push. Obama was a juggernaut for the plutocrats.

Khuzami, by the way, was one of the George W. Bush holdovers. As the Wall Street Journal had said on 20 February 2009, headlining "Khuzami Will Lead SEC Enforcement": "Mr. Khuzami, a Republican, spoke at the 2004 Republican National Convention on behalf of then-President George W. Bush." On 12 June 2007, Khuzami contributed the maximum, $2,300, to John McCain's Presidential campaign against Obama. Of course, the "Democratic" candidate won that "election."

Here's a typical example of the liberals' praise for this action by Obama: Justin Ruben of moveon.org said, "This is a huge deal for the American people, and the biggest victory yet for the 99%." It was anything but.

On 3 February 2012, Edward Wyatt bannered in The New York Times, "S.E.C. Is Avoiding Tough Sanctions for Large Banks," and he reported that, "Even as the Securities and Exchange Commission has stepped up its investigations of Wall Street in the last decade, the agency has repeatedly allowed the biggest firms to avoid punishments specifically meant to apply to fraud cases. By granting exemptions to laws and regulations that act as a deterrent to securities fraud, the S.E.C. has let financial giants like JPMorganChase, Goldman Sachs and Bank of America continue to have advantages reserved for the most dependable companies, making it easier for them to raise money from investors, for example, and to avoid liability. ... An analysis by The New York Times of S.E.C. investigations over the last decade found nearly 350 instances where the agency has given big Wall Street institutions and other financial companies a pass on those or other sanctions." Obama's entire Presidency (like Bush's before him) was functioning with the aim to pump up the stocks and bonds in the Wall Street firms that had funnelled trillions into the pockets of the aristocracy, and that had vaccuumed out the wealth of the public. It was gross. It was government via a criminal gang of centi-millionaires, and billionaires.

Reuters headlined on 24 February 2012, "SEC Chief Resists Pressure on Global Accounting," and reported that Mary Schapiro was refusing to cooperate with the International Accounting Standards Board (IASB) in setting up International Financial Reporting Standards (IFRS) to facilitate international trade by establishing accounting standards that investors worldwide would have sound reason to trust. She insisted instead on maintaining the existing U.S. Generally Accepted Accounting Principles (GAAP), in order to continue facilitating elite theft from outside investors. Obama didn't talk top-down, but all of his personnel and policies were operating strictly top-down: trickle-down, never bottom-up, never progressive. His actions showed the reality of whom he was.

On 5 February 2012, Yves Smith bannered at her nakedcapitalism.com, "Schneiderman MERS Suit and HUD's Donovan Remarks Confirm That Mortgage 'Settlement' Is a Stealth Bank Bailout," and she reported that a mortgage "settlement" that the Administration was planning to make public the next day was actually going to be just PR for the big banks, "to create the impression that they are Doing Something for Homeowners," while actually "the settlement amounts to a transfer from retirement accounts (pension funds ...) and insurers to the banks. And without this subsidy, the biggest banks would be in serious trouble." The Administration was hoping to get the cooperation of Schneiderman and the other recalcitrant Democratic state AGs, so as to enable the big banks to offload as much as possible of their real-estate losses onto outside investors, while providing only token assistance to stressed-out mortgagees and former homeowners.

This "settement" was actually announced on 9 February 2012. Obama's "Justice" Department headlined "Federal Government and State Attorneys General Reach $25 Billion Settlement with Five Largest Mortgage Servicers." Yves Smith headlined that day, "The Top Twelve Reasons Why You Should Hate the Mortgage Settlement," and she described the capitulation of Schneiderman, Harris, and the other recalcitrant Democratic state AGs. Illegally foreclosed former homeowners would receive about $2,000, in return for which the state investigations into those foreclosures would be halted. This would make more difficult the recalcitrant state AGs' still-ongoing investigations into the securities frauds that had tanked the economy. The statute of limitations for prosecuting those securities frauds was only five years (the aristocrats who write our laws love statutes of limitations, as the best protective device for such white-collar crooks, but there are no such statutes protecting lower-class crooks), and Bush/Obama had already successfully blocked prosecutions for all of those crimes that occurred prior to 2008, so that only the very tail end of the banksters' MBS crime-orgy remained still in play for prosecutors, even in the few instances where a prosecutor was honest and sincerely wanted to fulfill his or her oath of office. (Just a year more, and America's banksters would have immunity for all of their crimes that had brought the world economy down.) Although a few bones (this $2,000) would be thrown to the illegally dispossessed homeowners in order to get investigations stopped, Obama wouldn't stop the few remaining state investigations that might benefit the defrauded MBS investors; however, the statute of limitations would soon make those prosecutions moot anyway. The stockholders in the five big banks - BOA, JPM, WF, Citi, and Ally Financial (the previous GMAC) - would now be paying this wrist-slap fine, to the abused former homeowners, on behalf of those banks' own executives and former executives, who had actually driven, and made billions from, these massive, world-wrecking, financial crimes. Yves Smith also noted: "The various news services are touting this pact," by serving as stenographers for the Administration on it. Such was "journalism" in Amerika's "democracy."

Republicans simply condemned the deal, because supposed deadbeat borrowers would be receiving its benefits. On 9 February 2012, businessinsider.com bannered "Dick Bove Goes Ballistic Over The 'Mortgage Deal From Hell'," and reported that, on CNBC, this "banking analyst" had complained that, "These people were not making payments on these houses in the first place," and yet "the government has decided to pay everyone who cheated on their mortgage 2,000 bucks." Conservatives were simply furious that people who had been illegally foreclosed (or, in some cases, who were even dispossessed without there even being any mortgage), would be receiving even this token payment. Republicans hated and despised those people.

But liberals were told that Obama was now a tough cop on the bankster beat.

Then, the next day, on the night of Friday February 10th, masaccio at firedoglake.com bannered "No Agreement in Principle in Foreclosure Fraud Settlement," and he reported that the supposed text of this supposed "agreement" wasn't being made public. "There isn't even a written agreement in principle awaiting reduction to a final text." There was actually nothing at all, but this reality was dumped during the quiet of a Saturday, by which time America's so-called "news" media were already onto the "next thing," nothing so stale as "yesterday's news." Dennis Kelleher, a columnist at The Huffington Post, bannered "First Bank Fraud, Now Political Fraud" and he noted: "There is one standard for hard-working people and there is another standard for the wealthy, well connected, powerful, and, almost always, the big campaign contributors." Obama was 100% such a double-standard type of guy, and actually was the top culprit here, but wasn't so much as even mentioned by the liberal Kelleher.

It seemed that Schneiderman and the other disaffected Democratic state AGs might not be willing to sign onto Obama's deal, after all; but the public wouldn't know it. This is how Barack Obama was aiming to win re-election, by making suckers out of faithful liberals - seeking liberals' votes by means of shams like this. He exhibited as much respect for his followers, as did Gingrich, Romney, and other Republican conservatives, for their followers. And the major "news" media served as scribes, or stenographers, for those in power. Even liberal media did, by being "bipartisan" about the truth. For example, at The Huffington Post, columnist Marty Robins, headlined on February 12th, "Mortgage Settlement: Really? For Whose Benefit?" and he said that the supposed "settlement" was "manifestly unfair to those who did not take on unaffordable mortgages, and a thinly disguised attempt to buy votes (with banks' money)," or in other words: he said that the mortgagees - and even the individuals who didn't have mortgages but who were dispossessed by entirely fraudulent documents - should be socked with all of the losses, and the banksters shouldn't face any penalties or fines or give-backs at all, in any of these outrageous cases. Fox "News" could then cite such "liberal" sources to back up their charges that Obama was here stealing from the banks in order to give to rank deadbeats. The idea was that if the supposed mortgagees hadn't been "irresponsible," there wouldn't have been any problem at all.

But on February 13th, things looked even worse: Yves Smith bannered "Quelle Surprise! Administration and State Attorneys General Lied," and she reported that the "Mortgage Agreement Executive Summary" that was supposedly being issued, reflected a virtually total capitulation by the rebelling state AGs, such that if an agreement were ever to issue which would be consistent with this "Executive Summary," those Democratic AGs would turn out to be liars; and so would the Administration, because this "Executive Summary" reflected a far broader capitulation to Wall Street than was being promised by the Administration. Outside investors, the MBS-investors who were huge victims of the megabanks, would be treated "like perpetrators as opposed to victims," if the now-published "Executive Summary" was at all accurate. (Of course, by this time, the "settlement" was already "yesterday's news," to America's major "news" media.) On February 15th, Yves Smith headlined "HUD's Donovan Tells Remarkable Whoppers About Settlement to Mortgage Investors," and she reported "yet another sign of Obama Administration brazenness: to have officials tell lies to an audience that will KNOW it is being lied to, with no concern about backlash. They clearly assume that they have sufficient control over the media that they need not worry." The cheated MBS investors could only fume privately.

Then on February 16th, Shahien Nasiripour in Britain's Financial Times, bannered "US Taxpayers to Subsidize $40bn Housing Settlement" by underwriting the megabanks' losses from the depreciated repossessed houses. So, this "$25 Billion Agreement with Five Largest Mortgage Servicers" was to unleash $40 billion in additional taxpayer bailout funds to Wall Street. Neil Barofsky, the former TARP IG, was quoted as saying that this settlement, if signed by the state AGs and by the Administration, would be "scandalous." It would turn "justice and accountability on its head," by rewarding the megabank-elite crooks and punishing both their already-cheated outside investors, and U.S. taxpayers. Moreover, "People familiar with the matter told the FT that state officials involved in the talks had had misgivings about allowing the banks to use taxpayer-financed loan-restructurings." Obama and his team simply bought off resistant state AGs. When everyone around you is corrupt (including the mainstream media), what's there left to hold out for? Bribes and threats will rule the day - and the ensuing long night.

On 21 February 2012, Yves Smith bannered, "Quelle Surprise! Servicers Rip Off Investors as Well as Homeowners," and she documented that the same banks that were robbing borrowers were also cheating investors, at the exact opposite end of their assembly lines that produced mortgage-backed securities.

The American "news" media were taking Obama-Administration feeds and stenographically transmitting them as "news" about what was going on, even when these Administration PR pieces were just lies. Buried, a month later, in a 17 March 2012 online news story from Rupert Murdoch's nypost.com, finally appeared an admission by a Democratic congressman from Brooklyn, Ed Towns, saying that, "Many of the details of this settlement have yet to be worked out." In other words: There wasn't any "settlement"! Headlining there, "House Panel Queries Banks in B'kln Session," Paul Tharp reported that at this meeting, which was scheduled to take place in Brooklyn the following day, "At least one high-profile witness invited to testify isn't showing up: New York Attorney General Eric Schneiderman. ... His office didn't return calls." Then, on March 19th, rawstory.com bannered "Issa Heckled at Bank Hearing, 'Shame on You!'," and David Edwards presented video from the meeting, showing clearly that the congressional panel, which was headed by California Republican Darrell Issa, were vigorously condemned and interrupted by the attending public, who repeatedly tried to speak up at this Republican-Obama Wall-Street horse-and-pony show. For example, "One woman shouted, 'Vote for the people that elected you! It is not right for homeowners to lose their house, and children are homeless on the street.'"

Also on 19 March 2012, Cora Currier at propublica.org, bannered "Breaking Down the Mortgage Settlement," and she reported the deal, which "was finalized last week." It would pay an "estimated average payout" of $2,000, to 750,000 foreclosed homeowners who had had houses that were worth less than their mortgage. The total payout would amount to $1.4 billion, though that "negative equity" amounted to $717 billion; so, these former homeowners would be compensated for only a tiny fraction of their "negative equity." And nothing at all would be paid to people who had been foreclosed on the basis of fraudulent documentation, or otherwise victimized by fraud, etc., by banks and their mortgage sellers, etc., except where those real victims had had mortgages that were now "underwater." In other words: fraud and crime weren't even an issue in this "settlement." Moreover, the banks were to receive a "credit" of $17 billion for offering loan modificatons or other ameliorations, to, again, only "underwater borrowers." So, in no way did this agreement entail any penalties whatsoever for the massive crimes that had been committed by banksters. This "settlement" was a farce.

The public's prevailing faith in power was shown by the reader-comments at Yahoo News, on 6 February 2012, headlining from The New York Times, "Deal Is Closer for a U.S. Plan on Mortgage Relief," in which was reported that the principal amounts on some past-due underwater mortgages might be lowered via a deal that Obama was reaching with the banks. Reader-comments there were mainly hostile toward the victims and toward Obama, instead of toward the perpetrators, such as: "What about me, the underwater homeowner, for no reason other than other idiots not paying their mortgage! I have been doing the responsible thing and didn't buy too much house, and am still paying my mortgage, and my taxes ... WHERE'S MY RELIEF PLAN!" And: "Principle reduction??? #$% I paid my mortgage on time!" There was the pervasive belief that bad things generally don't happen to good people, and that good things generally don't happen to bad people - and also that there is an afterlife in which good things (heaven) never happen to bad people, and in which bad things (hell) never happen to good people. There was the pervasive belief that divine justice existed, and that this justice, the powers-that-be, was good, not evil.

hus, in a society of faith, victims are despised, successful crooks are admired, and government is therefore inevitably kleptocratic - otherwise known as a plutocracy. This situation applies not only in Third-World countries, but in the United States, which seemed heading to becoming one of them.

On 13 February 2012, David Dayen of firedoglake.com bannered "Missouri - Under Democratic Governor and AG - Becomes Second State to Vow to Divert Foreclosure Fraud Settlement Money to Budget," and he reported that Missouri was going to copy Wisconsin's Republican Governor Scott Walker by diverting its money from this settlement to the state's needs, and away from the illegally dispossessed alleged mortgagees. Even Democratic officials would do such a thing, in border states. If you happened to be a homeowner, or else a mortgagee, who was illegally dispossessed by one of the Wall Street banks (all of which banks were crookedly run), and you happened to live in a state like that, then your neighbors despised you so much that even Democratic officials there were inclined to steal from you the pittance that you were supposed to receive from Obama's settlement, and to use that pittance to make up for part of the state's deficit that had been caused, ironically, by those very same banks' criminality. (Of course, if you lived in a Republican state, then you'd have even less hope that you'd receive the pittance this settlement had agreed to for you.) The psychopathy within the United States had now reached unprecedented proportions.

The front cover of Time on 13 February 2012 featured the Obama/Holder U.S. "Justice" Department's Wall Street prosecutor Preet Bharara's face, and the headline "This Man Is Busting Wall Street." On February 8th, masaccio at firedoglake.com headlined about this cover, with appropriate contempt of both TIME and Bharara, "Time Out! This Man Isn't Busting Wall Street." Millions of people were being subjected to TIME's lying aristocratic propaganda; few people ever saw masaccio's truthful take-down of both Bharara and TIME. In fact, not a single bankster had even been prosecuted, let alone convicted, by the U.S. Attorney for the Southern District of New York, Preet Bharara, nor by any other member of Obama's "Justice" Department. The progressive group, CREDO Action, was by now (way too late) furious against Obama, recognizing that he was even worse on accountability than Republican Presidents had been. They wrote: "The new financial crime unit [that Schneiderman was co-chairing] has been given a paltry 55 staff members to undertake this enormous task. This contrasts to the approximately 1,000 FBI agents and dozens of federal prosecutors who were assigned to prosecute cases related to the much smaller savings and loan scandal of the '80s, or the 100 FBI agents tasked with investigating the Enron scandal, which involved just one company and caused none of the economy-wide damage we've seen since the collapse of the housing bubble." Actually, Obama might have been even worse than was George W. Bush - America's worst-ever President; Obama might have been the worst President in all of U.S. history.

On 10 April 2012, Yves Smith bannered "More Proof of Obama Settlement Lies," and she reported that the "Woefully Underresourced Investigation" that Eric Schneiderman co-led with Obama's Lanny Breuer (a career bankster-lawyer) wasn't getting the promised (and shockingly meager) staff of 55, after all. "Eric Schneiderman is finding out that he sold out to the Administration for far too little," and so he was "silent." Also on April 10th, at Smith's nakedcapitalism.com, was "Abigail Field: Hiding the Enforcement Fraud at the Heart of the Mortgage Settlement," and Field reported that, "On Thursday, April 5th, U.S. District Court Judge Rosemary M. Collyer [appointed by George W. Bush] announced she had decided to sign off on the '$25 billion' Mortgage Settlement," but Collyer didn't present the agreement to the public. "In acting silently, Judge Collyer not only okayed the deal's lousy terms, which institutionalize servicer theft and foreclosure fraud," but she kept the fraud "deliberately hidden" from the public. Field closed: "Will the media and grass roots groups let the trick work all the way through election day?" But would it really make any difference, now? Would Romney be any better? Of course not. Among the reader-comments posted to this report was one saying, "I have criminal, not just civil, fraud in my case. The originating lender sold the loan to two separate banks, and now they're attempting to hide that fact through yet another perjured document." But Obama's Government, and even local governments, refused to get involved: "The OCC: They sent my complaint off to the entity I'm complaining about. ... The FBI: They said they lacked the budget. ... District Attorney: They told me they like to go after people defrauding banks, not the other way around." Perhaps this person's house would be taken no matter what. So, in the U.S. now, what was government actually for? Obviously, it was for the plutocrats.

David Dayen at firedoglake.com headlined on 13 April 2012, "Justice Department Responds on Securitization Fraud Task Force," and he reported that, in a convoluted way, the "Justice" Department had just admitted to him that "nobody has been hired" yet for the Task Force, and also that he was told that, since the five-year statute of limitations had already run out on virtually all of the activities that would be investigated (and all would have expired before the end of 2012), the investigations - whenever they would start - would be pursued only as civil, not at all as criminal, matters, so that, if prosecutions succeeded, the only result would be that the big banks would pay yet more fines, which, yet again, would come out of the hides of current stockholders in those banks, not out of the accounts of the banksters, nor of the bailed-out aristocrats who had owned bonds and stocks in those banks up to the 2008 collapse. In other words: Obama's "investigation" was purely a political ploy during an election year. "Eric Schneiderman's office never responded to a request for comment." Schneiderman's goose was cooked, but he refused to face Dayan or any of the (few) other inquiring investigative reporters. Perhaps he had sold out for something; perhaps he had sold out for nothing; he wouldn't say anything to any such reporter; he was still staying incommunicado.

However, there were a few reporters who fortuitously "bumped into him" so that he had to respond. On 18 April 2012, Mike Gecan and Arnie Graf bannered in the N.Y. Daily News, "Obama's Mortgage Unit is AWOL: Schneiderman Should Quit This Fraud," and they reported that on March 9th, Schneiderman had told them that, "As of that date, he had no office, no phones, no staff and no executive director [the person who would actually be responsible for running the investigations]. None of the 55 staff members promised by Holder had materialized. On April 2, we bumped into Schneiderman on a train leaving Washington for New York, and learned that the situation was the same." Then, "Tuesday [yesterday], calls to the Justice Department's switchboard requesting to be connected with the working group produced the answer, 'I really don't know where to send you.'" Gecan and Graf said that Schneiderman "should resign and go back to working effectively with fellow attorneys general in Delaware, Massachussetts and Nevada." Was Schneiderman afraid of a bullet in his back, or just looking forward to being promoted ultimately to a higher position within the aristocracy? To call this country a "democracy" would be ludicrous, at this time.

However, Schneiderman made clear his answer to that question when the New York Law Journal bannered, on 15 May 2012, "A.G., U.S. Attorney Headline White Collar Crime Institute," and Schneiderman and Preet Bharara (the chief non-prosecutor of banksters) addressed the White Collar Crime Institute of the New York City Bar Association (in other words, Wall Street's defense lawyers), and Schneiderman effusively praised Wall Street: "He said that he was 'very pro-Wall Street' and had represented some financial services firms in private practice. He said that the majority of people working in the financial industry are honest, but added that the 'ability to tell people that and not have people scoff has been damaged' by ongoing scandals." Schneiderman here was mending fences, just in case any of his potential future employers might get the wrong impression and think that he would have qualms about their hiring him. He was saying that, unfortunately, in his present role, as the elected A.G., there were those in the public who would "scoff" at him if he were to tell them the kind of thing that he was telling Wall Street's lawyers. Not only was Schneiderman not angry at Obama for having given him an empty title for an office with no resources, but he was now campaigning to become an actual direct servant of the banksters.

So, that brings us up till now.

On November 19th, David Dayen at firedoglake.com headlined "Short Sales Continue to Dominate Consumer Relief in Foreclosure Fraud Settlement," and he reported that almost exactly half of the $26 billion settlement was going to "short sales," and that "a short sale occurs when an underwater borrower is allowed to sell a home for less than they owe on their mortgage, and the bank forgives the remaining debt on the loan. If the bank refused to do this and instead foreclosed on the home and sold it at auction, they would recoup LESS of the cost of the mortgage." Furthermore, the borrower might end up being forced to pay taxes on the foregone debt as "income." "And this is considered 'consumer relief'!" Obama was a total fake. The same day, the Los Angeles Times bannered "Mortgage Aid Under Foreclosure Settlement Tops $26 Billion," and the first reader-comment there was "Yay, let's reward the irresponsible jagoffs that bought houses they couldn't afford, then saddled the rest of us with the problem." Not only was Obama doing the mega-banks' bidding, but he was playing into the conservative framing of the big issue here, of what had caused the 2008 crash and the subsequent soaring federal debt. It was the poor and the liberals. The blame would be going to them - not to the mega-bank CEOs who had set up and operated these scams. Romney would not have been nearly as competent an operative for the plutocrats; he would just have handed the Government to them, crudely, like George W. Bush did.

If one looked up the background of the particular man, Joseph Smith, who was the "Monitor" of the "Office of Mortgage Settlement," that had been set up by the Obama-Holder-"Justice" Department to "Settle" all these cases, one found, "About the Monitor," that he had "served as North Carolina Commissioner of Banks beginning in 2002, and resigned from that position in February, 2012," to take on this plum job for the mega-banks, not the least of which banks was Bank of America, which was headquartered in North Carolina, and which had taken over Countrywide Mortgage and was thus his chief benefactor as NC's bank commissioner. "Smith also served from 2009 to 2010 as Chairman of the Conference of State Bank Supervisors. ... Prior to his tenure in state government, Smith spent 27 years practicing corporate, securities and banking law in North Carolina, Connecticut and New York. He is the former general counsel and secretary of a North Carolina bank holding company." In other words: So long as he continued to serve the mega-bank CEOs as well as he was now doing, he would be a prime candidate to become one of them, and so perhaps to enter ultimately the FORBES 400 wealthiest Americans.

So, that's the front-story, and the back-story, behind Obama's settlement with the mega-banks, for their having heisted millions of homes, via robo-signing and other illegalities and outright frauds, which robbed not only homeowners but outside investors and crashed the U.S. economy in 2008 - and for which, the vast majority of Americans blame the victims, and not the actual planners and perpetrators of this massive multi-trillion-dollar elite heist of America's mortgagees and mortgage-investors, and ultimately taxpayers. If one wants to know who walked off with those trillions of dollars, for which the U.S. Government is now in debt, it's those plutocrats.

What has been recounted here is just the end of a very long story, most of which (of course) preceded Obama's entrance into the White House. Obama merely finishes off the job that George W. Bush and the Republicans began. Whether to call Obama a Republican is questionable, since he's so hated by them and denies that he is one of them, but he has been serving that Party's chief financial benefactors superbly, even if he has not been serving the millions of Democrats who financed his own campaigns. However, one thing that no reasonable person can question is that he has been a brilliant politician, regardless of what Party he is actually committed to. If he is a Republican at heart, he is a masterful one. If he is a Democrat at heart, he is an extremely puzzling one.

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