As a potential federal settlement with five major banks nears, progressives on and off Capitol Hill have been sounding alarms about the apparent lack of punitive action and aid for homeowners, along with the civil immunity the deal may grant banks.
President Obama made things really interesting during his State of the Union speech on Tuesday, declining to mention the settlement but announcing a program designed to help homeowners refinance troubled mortgages and, most notably, a new task force to investigate mortgage fraud, headed by New York Attorney General Eric Schneiderman.
The new programs have enormous potential to both help homeowners and hold banks accountable, but there are many important questions that need to be answered about the task force in particular. Who will staff it? How seriously will it pursue fraud charges, given that some of the already appointed members have so far failed to do so? If the settlement is approved, how would any immunity granted in that deal impact the task force’s work?
Delaware Attorney General Beau Biden, who has said he will not support the deal as drafted because it would limit the mortgage fraud investigations he is pursuing in his state, appeared on Dylan Ratigan yesterday in a fascinating interview on these very issues.
Biden suggested he was asked to join the task force, but spoke to several concerns he had about the structure. “I applaud the president’s comments last night, and the resolve to continue investigations,” he said. “[B]ut the questions I have [are]: how many FBI agents are you going to put on it? How many investigators are you going to put on it? How many prosecutors are you going to put on it? Those are the hard-scrabble questions I have. I told those folks that I’m willing to work with them on this, and I’m happy to do it, and I hope we’ll get somewhere on this.”
Earlier in the interview, Biden reiterated his strong opposition to any immunity for the banks, and said, “We need to act and investigate, file cases, file complaints, seek indictments, if the facts take us there. We need to act.”
In perhaps his most striking comments, Biden also said he believes the banks aren’t even worried about any of these investigations. “The too-big-to-fail banks believe that many of us on the enforcement side are as scared, or more scared, than they are of peeling back this onion,” he said. “The too-big-to-fail banks simply don’t believe we have the guts to get to the bottom of this.”
You can watch the full interview here, which I would recommend: