Wednesday, July 30, 2014

What would be "the limit" then?

A judge ordered Bank Of America to pay $1.3 billion in fines today stemming from its Countrywide unit's mass defrauding of Fannie and Freddie over junk mortgages. 
Known for having strong views on financial fraud, Judge Rakoff issued a sharp rebuke of the bank’s misconduct.

“It was from start to finish the vehicle for a brazen fraud by the defendants,” he wrote in a 19-page opinion, “driven by a hunger for profits and oblivious to the harms thereby visited, not just on the immediate victims but also on the financial system as a whole.”
The judge could have gone on to note that "the financial system as a whole" is no less vulnerable to such plotting today than it was during the height of the real estate bubble or that, thanks to large scale federal bailouts, BOA is in position to pursue such schemes in perpetuity. But OK.

Countrywide's manager at the time, Rebecca Mairone, was also fined $ 1 million personally.
Ms. Mairone, the judge ruled, can pay the fine in installments over a period of time. That decision, he explained. reflected a concern that the government’s demand for a lump sum $1.2 million penalty “would strain her resources to the limit.”
She's retained a large enough share of the spoils that her "limit" is somewhere just beyond $1.2 million. But we're letting her manage that so.. good for her.

Nowadays Ms. Mairone is working for JP Morgan Chase.  Her job there is overseeing the government program that compensates victims of the financial crisis. In other words she's kind of the Patrick Juneau of the mortgage hustle.   Get em on the way in and get em again on the way out.  That's the way the grift works.

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