Facing a tough audience of Congressional progressives Thursday, New York Attorney General Eric Schneiderman attempted to address concerns about the staffing and intentions of the Residential Mortgage-Backed Securities working group—the federal inquiry into Wall Street malfeasance leading up to the financial crisis.
Before the public hearing, Representative Maxine Waters handed Schneiderman a letter signed by forty members of Congress expressing concern that his investigation had “stalled.” It also asked him to hire Representative Brad Miller as an executive director. (I reported earlier this week that Miller was told he would not get the job and that Miller believes the task force is afraid of Republican and industry blowback to his hiring).
High-profile signees included Waters and Representatives Jim McDermott, Earl Blumenauer, Lynne Woolsey, Keith Ellison, John Lewis, Jerrold Nadler and Jim McGovern. The letter read, in part:
We understand that the task force is leveraging pre-existing enforcement efforts and staff at participating agencies, but we remain concerned that the Working Group has not independently established a robust infrastructure commensurate with the charge of investigating this component of the 2008 financial crisis.
With three months having passed since the initial announcement of the creation of the RMBS Working group, we fear this group’s efforts may be stalled. The best way to reignite this important undertaking is to hire a qualified, aggressive and committed staff director, and give them the power and budget to hire the necessary support staff. Without quick action in this regard, public confidence in the Working Group may be at risk.
During the public hearing, Schneiderman acknowledged that the working group was not yet adequately staffed, but expressed hope that it would be. “We don’t have the resources yet. The operation just got set up really in the last sixty days or so,” he said. “They’ve posted for jobs, they’re hiring people, they’re detailing people, they’re entering into contracts with contractors for auditing and financial analysis.”
He clarified that the previously reported fifty staffers are new to the investigation, and are being dispatched from the Department of Justice to offices across the country. “I’m not counting folks like the fifteen people in my office who were already working on this,” he said.