Five years after the Obama administration and Congress passed “financial reforms” aimed at “reining in” banks once deemed “too big to fail,” three top Democrats are accusing a federal housing authority of quietly changing finance rules in order to shield two recently convicted banks.
As reported by The Intercept, an investigative news web site, the Department of Housing and Urban Development (HUD) has removed a key provision in requirements for taxpayer-guaranteed mortgage insurance so that the banks, which were found guilty of federal crimes, could still participate in the lucrative market.
It’s a clear case of #BankLivesMatter instead of #blacklivesmatter, given that much of HUD’s housing assistance traditionally has gone towards helping minorities.
The Intercept further reported:
HUD’s action is the latest in a series of steps by federal agencies to eliminate real-world consequences for serial financial felons, even as the Obama administration has touted its efforts to hold banks accountable.
Changing the rules to help out friends, donors
That means, essentially, that guilty pleas are meaningless; fines and other discretionary “punishments” may still be meted out, but as far as having any lasting effect or jailing the guilty, neither of these options seem to be in the offing.
Liberal stalwarts Sens. Sherrod Brown of Ohio and Elizabeth Warren of Massachusetts, along with Rep. Maxine Waters of California, have sent a letter to HUD officials noting that they think the timing of the agency’s rule change was aimed at clearing the way for the two big banks recently convicted, JPMorgan Chase and Citigroup, to continue making Federal Housing Administration-insured (FHA) loans.
In 2014, The Intercept reported, JPMorgan Chase made $1.6 billion in FHA loans; Citigroup wrote $342 million, according to data from the Congressional Research Service.
In late May, both banks entered guilty pleas on a single felony count of conspiring to manipulate foreign currency exchange trades, the largest financial market in existence. Five days before the May 20th plea, HUD officials quietly placed a notice in the Federal Register (here), seeking approval from the Office of Management and Budget to change its standard loan-level certification form, titled HUD-92900-A, which must be filled out for lenders so they can receive FHA insurance. The coverage reimburses them if the home loan is foreclosed.
Currently, lenders have to certify on the form that their business and its principals “have not, within a three-year period…been convicted of or had a civil judgment rendered against them” for a number of criminal offenses. They include the “commission of fraud…violation of Federal or State antitrust statutes or commission of embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements or receiving stolen property.”
In politics, nothing ever really changes
Notes The Intercept: “JPMorgan and Citi’s guilty plea would fall under the antitrust statute, and according to Brown, Warren and Waters’ reading of the certification, that would make them ineligible to obtain FHA insurance on their loans.”
The updated form removes this language, but the notice in the Federal Register makes no mention of the removal, so it would impossible to know without comparing the old form to the proposed new form. In May, Dow Jones Newswires published a story noting the change but did not report that it would allow convicted banks to get off scot-free.
The Obama administration, it seems, cares less about protecting Americans and more about protecting criminal banking cartels that have historically preyed upon customers and investors by rewarding them with taxpayer-provided financial windfalls.
It’s the same with minorities. The administration and members of Congress claim to “care” so much about them when it election time rolls around and they are pandering for votes; actually implementing policies or enforcing rules that punish corporations and banksters who prey on minorities is out of the question, however.
The more things change, the more they remain the same.
For more news on the shady dealings of banks and how they violate federal law, go to Banksters.news