- Jeff -
- Here is more and very credible info on why the plug was
pulled on Spitzer. Read his oped piece from the Feb. 14, Post and
you can see that he was pointing the finger at the Bush crime syndicate.
See the last paragraph. So it seems that Spitzer's true crime was stupidity
-- how could he think that he would visit high-priced call girls and also
attack the Bushinistas at the same time without being counterattacked?
-- Jim
- Predatory Lenders' Partner in Crime
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- How the Bush Administration Stopped the States From Stepping
In to Help Consumers
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- (The following oped by Eliot Spitzer was published
barely a month prior to the unfolding scandal and his demise as Governor
of the State of New York. Does the scandal bear any relationship
to Spitzer's intent to reveal the criminal nature of the subprime mortgage
scam and the role of the Bush adminstration. Was the scandal intended to
silence Eliot Spitzer?)
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- By New York Governor Eliot Spitzer
- The Washington Post
- Feb. 14, 2008
- Several years ago, state attorneys general and others
involved in consumer protection began to notice a marked increase in a
range of predatory lending practices by mortgage lenders. Some were misrepresenting
the terms of loans, making loans without regard to consumers' ability to
repay, making loans with deceptive "teaser" rates that later
ballooned astronomically, packing loans with undisclosed charges and fees,
or even paying illegal kickbacks. These and other practices, we noticed,
were having a devastating effect on home buyers. In addition, the widespread
nature of these practices, if left unchecked, threatened our financial
markets.
- Even though predatory lending was becoming a national
problem, the Bush administration looked the other way and did nothing to
protect American homeowners. In fact, the government chose instead to align
itself with the banks that were victimizing consumers.
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- Predatory lending was widely understood to present a
looming national crisis. This threat was so clear that as New York attorney
general, I joined with colleagues in the other 49 states in attempting
to fill the void left by the federal government. Individually, and together,
state attorneys general of both parties brought litigation or entered into
settlements with many subprime lenders that were engaged in predatory lending
practices. Several state legislatures, including New York's, enacted laws
aimed at curbing such practices.
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- What did the Bush administration do in response? Did
it reverse course and decide to take action to halt this burgeoning scourge?
As Americans are now painfully aware, with hundreds of thousands of homeowners
facing foreclosure and our markets reeling, the answer is a resounding
no.
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- Not only did the Bush administration do nothing to protect
consumers, it embarked on an aggressive and unprecedented campaign to prevent
states from protecting their residents from the very problems to which
the federal government was turning a blind eye.
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- Let me explain: The administration accomplished this
feat through an obscure federal agency called the Office of the Comptroller
of the Currency (OCC). The OCC has been in existence since the Civil
War. Its mission is to ensure the fiscal soundness of national banks. For
140 years, the OCC examined the books of national banks to make sure they
were balanced, an important but uncontroversial function. But a few years
ago, for the first time in its history, the OCC was used as a tool against
consumers.
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- In 2003, during the height of the predatory lending crisis,
the OCC invoked a clause from the 1863 National Bank Act to issue formal
opinions preempting all state predatory lending laws, thereby rendering
them inoperative. The OCC also promulgated new rules that prevented states
from enforcing any of their own consumer protection laws against national
banks. The federal government's actions were so egregious and so unprecedented
that all 50 state attorneys general, and all 50 state banking superintendents,
actively fought the new rules.
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- But the unanimous opposition of the 50 states did not
deter, or even slow, the Bush administration in its goal of protecting
the banks. In fact, when my office opened an investigation of possible
discrimination in mortgage lending by a number of banks, the OCC filed
a federal lawsuit to stop the investigation.
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- Throughout our battles with the OCC and the banks, the
mantra of the banks and their defenders was that efforts to curb predatory
lending would deny access to credit to the very consumers the states were
trying to protect. But the curbs we sought on predatory and unfair lending
would have in no way jeopardized access to the legitimate credit market
for appropriately priced loans. Instead, they would have stopped the scourge
of predatory lending practices that have resulted in countless thousands
of consumers losing their homes and put our economy in a precarious position.
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- When history tells the story of the subprime lending
crisis and recounts its devastating effects on the lives of so many innocent
homeowners, the Bush administration will not be judged favorably. The tale
is still unfolding, but when the dust settles, it will be judged as a willing
accomplice to the lenders who went to any lengths in their quest for profits.
So willing, in fact, that it used the power of the federal government in
an unprecedented assault on state legislatures, as well as on state attorneys
general and anyone else on the side of consumers. [emphasis added]
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- The writer is governor of New York.
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