Washington Mutual, aka WaMu, is gone, but who can forget a bank with a name more suited for a circus act? WaMu’s collapse 18 months ago is the largest in American history, a collapse that involved not only massive fraud but also included bank regulators asleep at the switch at best or in on the scheme at worst.
WaMu was set up to fail by bank officials who bragged that they controlled the subprime market where they could reap huge fees with adjustable rate loans. These loans targeted people who they knew in many cases could not afford the loan.
According to a Senate report, bank officers pushing for commissions cut and pasted loan documents to qualify buyers they knew would default. Internal reviews by the bank reported 50-60% of loans to be fraudulent but nothing was done, as the bank pocketed huge profits reselling the loans to Wall Street. Think about it, the bank sold mortgages it knew would implode on homeowners.
As they set up families to lose everything, WaMu CEO Kerry Killinger pocketed $100 million in 5 years.
Now, 2 years later, let’s review the record. The bank failed, its losses passed on to Wall Street and the public, courtesy of the economic meltdown. Thousands of families lost homes, and credit. Lives ruined, and you might ask – where were the cops during all this?
During this time, federal or state authorities failed to charge a single bank official. Now think of what you know about bank crimes. If you walk into a bank and pass a note demanding $1000, the FBI hunts you down, but if you work inside the bank and write tens of millions in phony loans, you get bonuses.
Ok the system is not fair. But what you are now thinking is that surely the federal regulators at the Treasury who overlooked the fraud and entirely missed the collapse must have been canned. Think again. Not a single Treasury official had been fired, demoted or even given a time out. Yes, all the same people that failed to protect us before are still at the switch. It makes you very afraid.
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“tens of millions of phony loans” sounds like a tons of homes for a ton of families, who had little hope to buy a home, but they also saw an opportunity and signed the dotted line
I -GUY COMMENT
WELL you can see where this person’s heart is.Thank the lord someone will stand up and defend the banks against all those ruthless consumers and homebuyers.. Praise Wall street and lets pass the collection plate around again for the banks.