Obama and Schneiderman to Double Size of Non-Existent Task Force

On Sunday, roughly one thousand people from liberal community organizing group National People’s Action showed up at Tim Geithner’s house to ask that he investigate the banks.  “Are you with the people”, asked these activists.  In response to this exceptionally mild pressure, the administration and New York “Attorney General” Eric Schneiderman have decided that they have no choice but to do a bit more PR around the task force.  They have doubled its size, and they have appointed a coordinator.

Senior administration officials and New York Attorney General Eric Schneiderman said they’re busy behind the scenes doubling their team to more than 100 federal and state financial experts and drawing on staff in 10 U.S. attorneys offices around the country. Matthew Stegman, an assistant U.S. attorney, has been tapped as the group’s lead coordinator, according to three sources familiar with the task force’s work.

The unit has also delivered more than 20 civil subpoenas, collected more than a million documents and deposed many witnesses as it digs through the work of bankers, mortgage brokers, appraisers and others who from about 2004 to 2007 helped millions of Americans buy homes they couldn’t afford at prices that didn’t match their property values — all while bundling the mortgages into securities for sale to investors.

20 civil subpoenas on appraisers and brokers?  How… adorable!  And they finally tapped a coordinator, an assistant US Attorney based in eastern California.  That’s a clear tell, appointing someone far from a place where they could easily coordinate among multiple agencies.

The truth is, there is no task force.  Obama is lying.  Schneiderman is lying.  The Department of Justice simply took various individuals already working on cases involving foreclosure rescue scams and petty mortgage fraud, and designated them a new task force. It’s absurd.  The reality is that Obama and Schneiderman are both working on behalf of financial elites who will fund their campaigns and pay them a lot of money when they are out of office.  That’s the game, as I noted this morning in discussing Bill Clinton’s $80 million payday from banks (among other entities).

If you look at the video above, you’ll see that protesters are asking the question of whether Geithner is with the banks or with the people.  Um, he’s with the banks.  That’s been clear for years now.  The real question is why protesters are even bothering to ask.  And I suspect the answer is that no matter how many times Barack Obama proves himself to be a corrupt and dishonest politician, it’s too painful to concede that those who want social justice in America are truly without representation.

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About Matt Stoller

From 2011-2012, Matt was a fellow at the Roosevelt Institute. He contributed to Politico, Alternet, Salon, The Nation and Reuters, focusing on the intersection of foreclosures, the financial system, and political corruption. In 2012, he starred in “Brand X with Russell Brand” on the FX network, and was a writer and consultant for the show. He has also produced for MSNBC’s The Dylan Ratigan Show. From 2009-2010, he worked as Senior Policy Advisor for Congressman Alan Grayson. You can follow him on Twitter at @matthewstoller.


    1. Glen

      Ah, yes, very similar to the “advanced math” used to figure the true value of the $1200 TRILLION derivatives “dark” market:

      Real value to world:

      $1200 T x 0 = 0

      Real value to banksters:

      $1200 T x fees = HUNDREDS of BILLIONS of taxpayer bucks for banksters!

    2. EmilianoZ

      You guys know nothing about mathematics. If Cantor taught us one thing, it’s that all infinities are not equal. Some infinities are bigger than others.

      Same goes with nullities. Obama has just turned Schneiderman into a larger nullity.

      1. Yasu Y

        At least we could acknowledge that the multiplier on the infinite or zero value grew, even if the result is infinity or zero.

  1. Winston

    “it’s too painful to concede that those who want social justice in America are truly without representation”

    And it has been that way for a few decades as the financial sector has been enabled by legislation to grow at a fantastic rate and, therefore, afford to buy more politicians.

    The sooner people realize that and simply stop voting for the very slightly lesser of two evils, the sooner we’ll actually see a government that actually represents the people. If they can always count on you vote no matter what they do, they will _never_ change.

    SENATOR DICK DURBIN on Bill Moyers’ Journal: [Banks] are still the most powerful lobby on Capitol Hill. And they frankly own the place.

    1. Sanders Ftwentytwo

      But then there’s the other owner/ruler class who “frankly own and rule the place”. Dick didn’t mention them during his shrug of defeat. Can’t offer cramdown to millions of bank victims when Defense Contractors depend on it:

      “An Illinois company has received millions of dollars worth of earmarks from the office of home-state Sen. Dick Durbin (D-Ill.) — while retaining the wife of Durbin’s chief of staff as a lobbyist on the account.”

    2. Carla

      I recommend a book called “Fixing the System, a History of Populism, Ancient and Modern,” by Adrian Kuzminski, for a clear assessment of what has led us to this sorry state and a possible solution.

  2. Susan the other

    … and the words – securitization fraud – have expunged from the dialog…

  3. Gerard Pierce

    On the bright side – a number of states are now able to cover 10% of their current budget deficit by stealing the settlement funds that were supposed to benefit their underwater homeowners.

    1. Carla

      …while real estate investors are stealing the houses and land right out from under us to rent them back to us — instant serfdom in one-fell-mortgage-fraud swoop!

  4. Lambert Strether

    An even more cynical or possibly realistic view would be that the administration already has a fall guy all lined up, and if need be — if the “pressure” grows great enough — they’ll throw the fall guy under the bus (see here at “off the droshky“) and proclaim “Problem solved!” And then Schneiderman gets to be a hero! (And if the fall guy is already lined up, there’s no need to spend any money on investigation….)

    The nice thing about calling for an investigation of accounting control fraud is that it nullifies that tactic — accounting control fraud is systemic, not a case of a single “bad apple.”

    1. Mark P.

      You generally don’t start one of these dog-and-pony shows up unless you’ve put some thought into where it’s going.

      Highly realistic to think there are potential fall-guys.

    2. Enraged

      There have have been a slew of “fall guys”. All low-hanging fruits, though. And every time the media get wind of it, they expect us to clap and do that ridiculous touch-down little dance. The problem is that fish rot from the head down. And no one wants to touch the heads. Yet.

      Except… once in a while, when things get really, really bad, heads do fall. I can remember Ceaucescu in the 80s. Sadam Hussein (although I am not completely sure he was worse than many others still alive and kicking…), Khadafi a few months ago, Noriega before that. It does happen. Until the American people truly believes that there is nothing wrong with getting rid of the undesirable, and that sometimes it is just what the doctor ordered, we’ll be stuck with our rotting heads. How far down will the gangrene have to spread? Because it will happen. it’s only a question of time.

  5. Jimbo

    Asking Geithner to investigate the banks. That’s funny. He’s behind the cover-up and the president is his front man.

  6. briansays

    another thought
    maybe the chinese could loan us a few of their investigators
    we could even agree to provide the bullets

  7. Sluggeaux

    Might I suggest adding OJ Simpson to the investigative team? Perhaps Nevada will let him out of prison temporarily so that he can scour the country clubs for scapegoats…

  8. Lloyd C. Bankster

    I invited the entire Mortgage task force out to dinner last weekend at Masa’s, and we started with a little dish of shredded, pickled seafood followed by top-grade fatty bluefin tuna tartare cloaked in an equal measure of osetra caviar.

    Okay, a little high in fat but much better than the low-fat menu featuring sea bass with sprouts and aromatic leaves.

    Next we had a little bowl of foie gras and a sharp-toothed eel called hamo that comes in a delicate soy broth, a shabu-shabu-style dish – the velvety foie gras barely melting in the broth, the fish adding briny nuance to the fatted morsel.

    That bite came at a cost of around $450 per person, not counting tax, tip or drinks.

    I would have also invited the task force for a round of golf at the Sebonack Club, but unfortunately there weren’t enough of us that day to make a foursome.

    Ha ha ha

  9. Toby

    I was at the action. “exceptionally mild”? When you organize an action that creates more tension for a corporate tool of Geithner’s caliber than bringing 1000 people to his private residence–with people from across the country delivering multiple infuriating testimonies explaining to him and all his neighbors how he’s personally screwing over the entire nation–let me know and I’ll mail you a gold star.

    I find the analysis of the economy and the financial system on this blog extremely helpful. But this post demonstrates a lack of understanding of what it takes to translate ideas into political reality. I suggest leaving the evaluation of organizing efforts to people who actually understand such things.

    1. Jack M.Hoff

      Toby, Id say that those of you at Pig Geinthers house acted with great restraint. Not mild manners. I can only hope the bastard got the message. I’m sure he was whining about you upsetting his wife, kids, and neighborhood. Little did he give a damn about the millions kicked from houses due to his and his kind’s treachery. Yes, I’d say you gave him a real break, this time.

  10. Up the Ante

    More reactionary politics, or Rule by Political Aide Acts
    [rule by political contempt]

    “.. head of a large bank AND a regulator ? “,
    “.. one thousand people .. showed up at Tim Geithner’s house to ask that he investigate the banks. ”

    [just don’t mention that Corzine fella, .. or that one called ‘Booshie’][and both those fellas, hey, both are ‘coopted’ by the Secret Service]

  11. Up the Ante

    This reads like a ‘cooption’ by the Federal Reserve of the Secret Service’s mission,

    “.. it has not been our practice to require formal admissions to the misconduct addressed in our enforcement orders given the remedial nature of our enforcement program. ”

    Now obviously someone has placed some emphasis on this already ..

    .. so their response to this shall be “telling”.

    Over 99% of Federal Reserve Bank Enforcement Actions Are Resolved Without Admission of Guilt

  12. Tedwa

    I’m an appraiser and these actions of 20 civil subpoenas on appraisers and brokers is NOT admitting the banks were behind it. This is how the banks are getting rid of the appraiser and broker profession!! This is not investigating or justice!!

    WAMU and Eappraiseit (an appraisal management company) conspired to inflate values on homes all over the country. The way they did it was that WAMU and Eappraiseit blacklisted any appraisers that would not come in at the appraised values needed to make these fraudulent loans!! Over 230,000 fraudulent valuations all over the country were made in 2006-2007. That many fraudulent valuations alone could raise prices 10-20% !! Bank of America just recently paid a $1 billion fine to stop the investigations into them doing the exact same thing WAMU and Eappraiseit were doing !! The TBTF’s were all doing it – using unethical appraisers to inflate values and getting brokers to pressure appraisers to raise values. AG Cuomo (at the time) of his investigation into WAMU and Eappraiseit was part owner of an AMC (appraisal management company) called AMCO. He strong-armed the GSE’s to only accept appraisals that went through these (now banked owned) AMC’s! In other words the problems in fraudlent valuations by the banks was legalized by his HVCC! This goes on today! And it’s a national disgrace.

    Get to the root cause aholes. Investigating the shills/dupes does nothing to investigate the origination parties of the cons. The goal of the banksters has been to get rid of brokers so they would have less competition and to eventually get rid of the appraisers by hiring only the least experienced and least ethical. This is a matter of the PUBLIC TRUST!! Do your jobs

    1. Tedwa

      If anybody would like an interview to do a story on these facts and how it’s affected not only the economy but also decimated 2 professions (the realtors are next), my e-mail address is spence.101 at live dot com. The truth must come out! The banks are now using unethical appraisers that will come in at whatever value they need and they skim up to 60% of the appraisers fees. The banks control the valuation market and that continues to drive down prices. The banks have now near total control of mortgage loan originations and valuations.

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