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View Diary: NY Atty. Gen. Schneiderman LOVES Today's Mortgage Fraud Deal. UPDATED x3 Liz Warren Likes it Too! (261 comments)

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  •  Appraisers and Ratings Agencies (7+ / 0-)

    The most corrupt part of the mortgage bubble, apart from its bankster architects in the Credit Default Swap racket, was the appraisers and debt ratings agencies. Appraisers lied to wildly inflate home values, while debt ratings agencies lied to wildly inflate mortgage instrument values. The two reinforced each other in a feedback cycle that inflated the whole market. Each is supposed to be the point where the fraud is stopped; both accelerated the cycle.

    There are thousands of people in appraisal and ratings agencies who committed frauds personally in the $millions, and collectively in the $trillions. They should all be in jail.

    At the very least both industries should be completely reregulated.

    Instead they all walk free, continuing their crime spree. And only minimal, inadequate regulations are being passed.

    The banks rule the world.

    "When the going gets weird, the weird turn pro." - HST

    by DocGonzo on Fri Feb 10, 2012 at 05:05:17 AM PST

    [ Parent ]

    •  I'm not sure the appraisers did anything wrong. (0+ / 0-)

      If something sells for the inflated value, obviously your appraisal wasn't inflated, it merely reflected market value at the time.

      •  Sure they did (3+ / 0-)

        There is plenty of evidence of the banks telling the appraisers what number they needed to hit -- and if they didn't, the appraiser wouldn't get hired any more.

        Without faulty or fraudulent appraisals, there's no way the banks would have been lending 125% of the stated sales price -- "cash out" mortgages. And as the market began to tank, appraisers continued to use older comparables at least in some markets.

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