It was bound to happen. The subprime mortgage fiasco is now the target of investigations by several law enforcement organizations.
The FBI today announcing it is looking at 14 companies—companies that may have committed fraud in the handing out of loans to mortgage borrowers who should not have gotten loans in the first place because of their obvious inability to be able to make payments on time.
Also in the picture—the Securities and Exchange Commission, working along with the FBI, to see whether there were insider trading violations.
Seperate from these investigations, there are ongoing ones at the state level in both New York and Connecticut; they are taking a close look at Wall Street banks–banks that may have hidden information from investors who purchased certain securities that had high risk subprime loans bundled in.
And now, it gets really interesting!
Related posts:
- SubPrime Loans and Foreclosures: Looks Like There is a Connection!
- Subprime Mortgage Crisis Helps Bring Down An Airline
- Subprime Mortgage Crisis Puts Brakes On Consumer Spending
- Subprime Mortgage Crisis Brings Citigroup CEO Down In Flames
- The Dark At The End Of The Tunnel: Subprime Fallout Hits Global Proportions
Article Author: Charles FeldmanCharles has written 179 articles for us.
Visit Charles's Website: http://www.thefeldmanblog.com
Charles is currently reporting for KNX Radio in Los Angeles, is the co-author of the book No Time To Think, and can be found commenting about the news on his blog, The Feldman Blog, as well as on The Huffington Post.
Joshua Dorkin
{ 10 comments… read them below or add one }
im sure all of these companies done something wrong. all the banks and companies who offer bank accounts also been doing this for some time. I have a friend who offers second chance bank account through a bank. it’s all a big rip-off. I’m sure loan companies been doing the same thing.
how long is the sub-prime effect going to linger on? Its really effecting everyone, not just in US
RK
These companies are burying borrowers deeper and deeper. They’re taking advantage of the person’s need for money.
Is stupidity a crime? I’m not talking about consumers who are told there is a way to have the American dream. But, all those financial decision makers that we entrust our well being to with our homes being the playing piece.
I am not finding the employees of these lenders any more educated on how the short sale or foreclosure process works.
I’m glad to see they are looking into this and hopefully in time we will better understand who is at fault. How most importantly to assure it doesn’t happen again.
I’m not sure if this is nationally or just here in Arizona, but I heard rumors of making mortgage brokers and other in that industry go through some sort of certification process like that of a real estate agent.
I also think, the subprime meltdown will show all her effects in 2008 and because it concernes people and companies all ober the world .
Wish I could list the 14 companies being looked at by the FBI, but the agency has not revealed the names because it is an active and ongoing investigation in its early stages. I am sure,though, the names will soon leak out to the media.
Too bad the government didn’t feel the need to have any oversight of the sub-prime industry before so many people were taken advantage of. This is a typical too little, too late response.
Couldn’t agree with you more Real Estate investor girl. It’s a stupidity crime. What’s happened down in South Africa, is they’ve now introduced a national credit act to prevent the malpractice of lending credit to people who actually just plain and simply can’t afford it. This just causes more choas for the companies economy than we can actually afford right now, and same goes for subprime mortgage lenders. The only difference was that our lending was by the banks….
YEAH NAUGHTY NAUGHTY