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Prosecuting Wall Street, pt. 1

December 4, 2011 4:02 PM

Two high-ranking financial whistleblowers say they tried to warn their superiors about defective and even fraudulent mortgages. So why haven't the companies or their executives been prosecuted? Steve Kroft reports.

Prosecuting Wall Street

60 Minutes OverTimeBehind the financial crisis: A fraud investigator talks

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by sickandtiredofallthis December 29, 2011 3:36 PM EST
Eileen is showing a classic case of bitterness. How stupid and irresponsible is it for her to sit back and claim innocence in the Fraud issues. She is just as much to blame as the loan officers that commmitted the fraud. She had the information, was in a position of power and authority to do something company-wide. What did she do? She sat back waiting until being "asked" by the Fed investigators.

Throwing blame to the other executives and loan officers is completely irresponsible on her part. Yes they were paid bonuses and salaries...but guess what Ms. Foster....you did too.

Its funny that now that her settlement case is finished, she now wants to give out all the information. Where were you in 2008 Ms. Foster? Witch.
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by garrisonville December 15, 2011 12:38 AM EST
To Steve Croft:
I saw your expose on Credit Default Swaps and it was good information for the unread. However, you left your buddies in government completely exonerated. Sure, some greedy operators took advantage of the situation, and this will always happen. Peeople aren't saints.

But you dealt with the symptoms and not the cause. What is the cause? Surely you know, otherwise you are not a qualified journalist. The cause comes from Congressional legislation.

CONGRESS IS THE ROOT CAUSE OF THE PROBLEM. Despite good intentions, Congressional social programs and congressional mismanagement are the real culprits. They wrote the plans for this debacle.

I hope you would agree that our national prosperity was built on cheap available energy, secure capital investment and the efforts of innovative people.

Over the past 35 years, Congress has constrained available energy (oil and coal) from local sources, causing huge payments to other countries, and severely draining our available capital.

Over the past 25 years, Congress has contaminated the mortgage credit market by encouraging more and more bad loans to people who are unable to follow through. And then they packaged bad loans together with good loans, contaminating the financial credit market.

Over the past 15 years, Congress has also crippled our banks and businesses with "Mark to Market" handcuffs.

Over the past 12 years, Congress has turned our banking and credit insurance system into a wild west gambling den. with the elimiination of "Glas Steagal Act", and the OK for unregulated Credit Default Swaps (gambling). And neither of these has been retracted.

So how on earth do youu, Mr. Croft, lay the blame on some little guys and a few greedy companies into this clearly criminal Congressional debacle?

Where is the cry for prosecution of the Congressional conspirators?

And how will we fix the problem if we don't expose the root cause?
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by onthedelaware December 14, 2011 11:46 AM EST
Countrywide/bankofAmerica appear to have been involved in misrepresenting my home for a HECM. I know that the FHA inspector that came to my home for them was from LandSafe but at the same time, I learned that the report he gave does not reflect my home's layout, that there was no well inspection, he never went into the basement that he claims, he did not list any of the defects which were major and a motivation for my needing equity to fix this 1926 house. When you get a HECM, it is supposed to state what needs to be fixed. My broker was thrilled that my loan did not say this. I owed $88K on the home. They gave me about $20 in equity and they appraised the home at $225. That was 2008. Today they say I have no equity. I guess they devalued my home? It has been very difficult to understand this loan. If I had simply kept my original loan and sold my home for $120K I would have not been dealing with huge increases in property taxes and would be living in PA. But I thought I had to fix the house to sell it! In fact, at closing I should have realized one of the obvious reasons for this sale -- repairs! If my house was said to need no repairs -- leaks in ceilings, bad plaster, no heat in two rooms (code ?), a roof collapsing, water in the basement, a dying water heater, a 1962 heater vented into a chimney (code violation), 1950 and 1926 windows, many problems with old paint, etc. -- how could I meet the terms of the contract. The contract said I had to keep the house in good repair or the bank could take the house. With the equity I had I fixed most of the house. I also enjoy a 30 percent increase in property taxes which is another variable that influences my ability to keep the house at 225% below poverty. Naturally the candle is burning at both ends now and I have no place to go. Naturally at age 68 this is a worry that consumes my days and nights. I wonder why FHA would report my house did not need repairs. I wonder why they show two interest rates? I wonder why they did not tell me until after the closing that there were two liens, one of which is for HUD? I wonder why the loan which is tied to the treasury note (they said) seems to be growing almost at the same rate as if I had a n escrow for property taxes and fire insurance with BOA. Their Customer Service has provided either wrong information, no information, or rude response to questions so I guess the real answer is that whatever information I had about this loan, there is still something I do not know.
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by lorenzoxM December 12, 2011 8:58 PM EST
Is it any wonder "Investment" BANKERS in the 1920's and 1930's caused the GREAT DEPRESSION and both World Wars,
and HITLER and STALIN and Chairman Mao?????
And, 120+ MILLION people dead because of their GREED???

Their pathetic lies and all of there MARGIN CALLS and DERIVATIVE crap from HELL!!! are causing misery World wide !!!

But, the BANKERS can't do it alone
they need Governments
and a docile and, woefully un-informed Citizens,
EDUCATED by TEACHERS that CAN'T be FIRED aka TENURE,
and 535 members of Congress exempt from INSIDER TRADING,
to PULL IT ALL OFF !!!!

Read the HAMMURABI CODE from 3,500 years ago, the BANKERS we're doing the same thing then as they are doing NOW !!!

Until, an EDUCATION includes MONETARY and FISCAL math instructions for CITIZENSHIP, this GARBAGE will go on forever, and the misery with it!!
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by mikemontreal99 December 12, 2011 7:04 PM EST
The problem here folks is that their is no real political will to go after the powefull who screwed the system. And its even worst here in Canada where the powerfull are few and well connected to governement. When the republicans decided to go after Bill Clintons to figure out if he did or did not put his manhood inside Monica they spent millions... But Democrats who dont really want to offend anyone and are focus on doing good and social things just dont have the balls to shake the house and invistigate all the frauds, torture in Gitmo and all the constitution abuse agaisnt citizens from the previous administration and their friends. Its just too bad because if they had the gut to do it they would win lots of vote and remain in power wich they wont soon !
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by KVH47 December 12, 2011 7:03 PM EST
Yeah, what a joke! Sounds like Lenny's on the take too. Why are people more than upset with OUR Government? There's just no justice in this Country anymore, that is unless you have money. Taxation without representation. And what a great return on Wall Street's investments in OUR political system... Think I'm gonna hurl
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by SIMONNUT December 10, 2011 3:05 PM EST
Un F@#king believable.... this is what the 99% is about!!!!!
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by Dupesinger December 10, 2011 5:07 AM EST
Greed is good, but even greater if you can dupe the Law and get away with it. It doesn't take a genius to somberly conclude that this fraud bubble nested, grew and bursted out of the internal control management of loan investment firms that conspired in the biggest financial fraud in this country. If any federal regulatory investigation is seriously taken, it has to begin with internal control execs accountability to reach the peak of this iceberg. Loan and Investment CEOs must be having their joy of a lifetime by having a Federal mom indulging when they sway the rules.
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by Hypnoted December 9, 2011 6:20 PM EST
It appears obvious to me - if someone has enough money, they can buy their way out of financial prosecutions just about every time. It's time to have one law for everyone, including large financial firms. That was the whole reason for the new law, yet the federal government is simply not doing their job - once again. Nonetheless, there was the Assistant US Attorney claiming his office has done all it can do. Truly, its rediculous to think officials such as him has the audacity to maintain such a stance in the face of facts to the contrary. But, again, why not do that when all the politicians do the same thing.

This entire mess came down because the Bush Administration did not want there to be a slow down in the economy while they were prosecuting two wars at the same time. That's why they refused to have HUD truly properly oversee the banks' procedures - all banks were giving as much as 105% mortgages and THEN agreeing to "seller's concessions" which was just another illegal way to give the buyers their clozing costs from the mortgage proceeds. The Bush Administration kept HUD from looking at those guidelines because if they had insisted upon the normal banking industries' guidelines for loans, half of the loans given out during the Bush Administration would have been turned down - as they are now during the Obama Administration. I stronly maintain that Bush/Chaney were behind this debacle and when journalists dig deeply enough, they'll discover it. Of course, that's why Bush's brother was never investigated either. Its time to stop all this "Good-ole-boy" network stuff and ask that everyone simply act honestly and responsibly and prosecute those who don't.
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by TheWatchmansRattle December 9, 2011 3:52 PM EST
Is 60 Minutes grabbing storylines from The Costa Report? First it was the investigation into Grover Norquist, and tonight Steve Kroft picks up where Costa's interview with whistleblower on the subprime mortgage fiasco, Michael Winston, left off. To hear the real, uncensored story about how Countrywide and Bank of America tried to muzzle Winston from exposing lending practices which triggered an intractable worldwide recession go to : www.rebeccacosta.com/thecostareport
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