ZIPPY....JPMorgan Chase has an automated system called "Zippy" for approving mortgage loans. But if it's automated, how did it manage to approve so many crappy loans? An editorial in The Oregonian provides a nickel summary:
As reporter Jeff Manning described Thursday, a JPMorgan Chase employee distributed a memo called "Zippy Cheats & Tricks," which reads like a tipsheet for beating a video game. It advises employees at the banking company how they can help mortgage brokers jigger the in-house system, called "Zippy," that evaluates loan applications. Overstate the borrower's income, it suggests. Don't mention that some borrowers are relying on gifts to repay their loans. Inflate assets. "Never fear," the memo reads. "Zippy can be adjusted . . ."Charming. Chase, of course, is investigating, because "This is not how we do things." Indeed.
Via Calculated Risk. More here from Barry Ritholtz.