President Barack Obama delivers his State of the Union address on Capitol Hill in Washington, Tuesday, January 24, 2012. (AP Photo/J. Scott Applewhite)
In his State of the Union address last night, President Obama announced an important initiative to address the housing crisis: one that will help affected homeowners while investigating and punishing those who helped create the problem.
A new mortgage crisis unit, made of up state and federal officials, which will look into wrongdoing by banks in the area of real estate lending. The unit will be headed by Eric Schneiderman, the attorney general of New York and a solid advocate for being tough on the banks for their role in the mortgage crisis.
“This new unit will hold accountable those who broke the law, speed assistance to homeowners, and help turn the page on an era of recklessness that hurt so many Americans,” Obama said in his address.
The unit will not supersede efforts by the Justice Department in this area (to the extent there are any) but will operate as part of the Financial Fraud Enforcement Task Force. Justice officials will still be involved, however, according to the Huffington Post, which first obtained details of the effort from the White House. In addition to Schneiderman, the unit will be co-chaired by Lanny Breuer of the Department of Justice; Robert Khuzami, director of enforcement at the SEC; John Walsh, a US attorney in Colorado; and Tony West, also of the Justice Department.
In a statement last night, Schneiderman promised tough investigations.
“The American people deserve a robust and comprehensive investigation into the global financial meltdown to ensure nothing like it ever happens again, and today’s announcement is a major step in the right direction,” he said. “In coordination with our federal partners, our office will continue its steadfast commitment to holding those responsible for the economic crisis accountable, providing meaningful relief for homeowners commensurate with the scale of the misconduct, and getting our economy moving again.”
As far as relief for homeowners, Obama made additional news last night, announcing additional federal efforts to help homeowners—though they must be current on their mortgage. A new federal program will allow those homeowners to refinance their mortgage at lower rates, and a federal fee on banks will help pay for the assistance.