Business

Mortgage Fraud Scandal Brewing *VIDEO*

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Criminal fraud may be one of the most underreported aspect of our current financial crisis.

This is Lagan at ANP.

In this “Road to Ruin” report, former subprime lenders from Ameriquest, once the country’s largest lender, describe a system rife with fraud. They describe how a “by-any-means-necessary” policy pushed employees to cut corners and falsify documents on bad mortgages and then sell the toxic assets to Wall Street banks eager to make fast profits.


  • kranky kritter

    I’ve been wondering when folks would get around to this aspect of the story in more close detail.

    • Borrowers fraudulently lied on applications about their income. “I’m sure it will be fine,” they said.

    • Loan originators knew, and often encouraged or even participated. “I’m sure it will be fine,” they said.

    •Loan purchasers knew, and hid behind “we’re charging higher interest rates because the income isn’t being verified. I’m sure it will be fine,” they said.

    • Loan packagers knew, and pretended to be able to package away the risk. “I’m sure it will be fine,” they said.

    • raters of these loan packages knew, and rated these packages as AAA investment grade by using models that presumed that 6-8-10 annual growth per year was sustainable over the long term, though everyone knew it wasn’t. “I’m sure it will be fine,” they said.

    • investors in the packages used the ratings as excuses to not understand what they were investing in. “I’m sure it will be fine,” they said.

    Top to bottom, beginning to end, either fraud or negligence or both at every stage. But I’m sure it will be fine.

  • Agnostick

    One need only remember that their are at least two signatures on every contract.

  • Trescml

    Although you basically have several people in this video admitting to fraud, I don’t think much is going to come out of this. A few random people will serve minor jail terms. If you get caught stealing a car you go to jail, if you scam 10K chances are very good that you will get away with it. We as a society don’t put a high priority on white collar crime so we will see these large scale scandals every 5 to 10 years to so.

  • Mike A

    Agnostik,

    “One need only remember that their are at least two signatures on every contract.”

    Under normal circumstances your point would be fine. But the systemic approach from, as KK puts it “Top to bottom, beginning to end….”, put our entire economy at risk. All of us, whose signatures did not appear on the contracts and were responsible in our own transactions, are now paying the price of others.

    The impact of those two signatures has substantially broadened beyond the two parties signing the contract