The LA Land blog of the Los Angeles Times, today, had some interesting comments in regards to the recent FBI mortgage fraud investigations. LA Times blogger Peter Viles gives his two cents on the success of the investigations to date, “My two cents: I worked for a particularly results-oriented boss who was know for saying, ‘Don’t tell me about the labor, show me the baby.’ In this case I agree: Don’t tell me about the investigations, show me the indictments. To date, nationally and in California, we’ve seen only nickel-and-dime cases against small real estate firms.” There is no doubt that the FBI has not been quick to indict any major mortgage lender, and that might be a good thing (of course, we all want the FBI to come to the table with facts, and overwhelming evidence), because, hopefully, when they do start making indictments, they are indictments against some of the larger lenders who went out and committed fraud in Costco-like volume.
FBI Director Robert Mueller says there has been a tremendous surge in fraud investigations and he expects it to keep growing. That could mean that any anticipated major news might take even longer. Patience will definitely be a virtue in this matter. Mueller even estimates that the FBI has 1300 investigations underway. It'll be very intersting to see what plays out in the coming months, particularly in regards to the TILA forms that initiated the bevy of option ARM loans (a focal point in the mortgage crisis).
It appears the FBI is doing an estimable job in trying to expose the unethical business practices that some of these subprime mortgage lenders employed. Unfortunately, until the FBI releases something major per these investigations, people will still be unclear as to the illegality of what subprime mortgage lenders did, and they’ll continue to blame borrowers, because the general public has still not been fairly informed by its elected or appointed officials.