The government and the public need someone to blame. I wonder how many of these people actually committed a crime, how many are caught up in a political mess where the politicians needing someone to blame, and how many will be forced to take a plea deal regardless of their innocence (and for those that don't think that happens..... when the FBI comes after you, you are screwed guilty or not). While there may be a few people in this group that are indeed guilty, this mass round up is IMO ridiculous and smacks of political expediency.

In a similar article it noted that some cities, Cleveland was mentioned, are sueing banks, mortgage brokers etc. for ruining neighborhoods etc. by giving out loan to people who didn't qualify.
To which I thought - if cities didnt' approve rampant over development with a gazillion new cheap housing developments maybe someone would be buying existing houses in these poor ruined neighborhoods. Maybe citizens should sue cities for urban sprawl, destroying the environment, long commutes, future ghetoization when the cheap new houses start to fall apart and existing home sellers sue for the city ruining their resale market.

I dont see this as being very difficult at all to dissprove/prove. There were agents around my area actually passing out info for apraisers that they new would make the number what ever it needed to be. Thier line was "the values are changing upward so fast that thier appraiser was in-tune with the new market", or some such b.s.

This has to happen to bring industry standards and proffesional decency back into play. Many of these proffesional are bonded in order to maintain thier credentials. Those companies will start clamping down and rightfully so imho.

I know what they were doing was ethically wrong; but how much of it was actually illegal?

Can't legislate morality, y'know...

It will be interesting to see if cities (like Cleveland) start taking a stronger interest in controlling quality of life in their environs-requiring better building codes, restricting growth, requiring builders to pay for infrastructure improvement. I don't know if they can do much to control unethical mortgage companies, though...

Scammers go to the slammer. Nothing unusual about that.

And, yes, folks in the financial industries do need to adhere to the ethics of their professions or they are breaking the law. And if they break the law or conspire to bend the law in a way that threatens the financial integrity of our nation (and thus our national security), they've stepped into some pretty nasty doo doo.

Go Feds!

Their case against the Bears Stearns men doesn't seem very viable.

I call scapegoating/grandstanding on that particular case.

What about all the thousands of homeowners and lenders who applied for/approved fraudulent loan applications?

The Bears Stearns boys are in big trouble. I'm sure all of the evidence has not yet been made public. Remember, the Feds have been working on this for over a year now.

There have been 400 some arrests so far and I'll bet there will be more to follow. I'm sure they'll get to everybody, in some way, eventually.

Oh yes... please....

This is MASSIVE scapegoating, and no mature adult could be fooled otherwise.

Puhlease....

I'll easily grant that there were/are pursuable shenanigans in the various tiers of the financial world (and of course, in government, and car parts, and maid service, and, and, and, and....)

HOWEVER... that was no less true 2 years ago... 3, 5, 7, 10 years ago...

The question anybody with three braincells to rub together would have to ask is;
This is so screamingly obvious in its timing... why?
Why weren't these "stings" and "busts" happening in 2000? Why not in 2003?

I'll tell you exactly why;
When everyone's happy flipping houses, and originating godzillions of mortgages... and Johnny Paycheck is watching his retirement get fat (on paper) from the high-yield "safe bonds" he's demanded of his pension managers... the hired help with the badges don't DARE call people out! They (the so-called authorities) will lose their job (if not worse.)

The timing of all this is so preposterous... so ludicrous as to make it a joke.

"Mob Justice" is what this is known as. The hired henchmen now that now is their time to "shine," and they get to play "saviour" to the lambs... the social "children" who want to participate without actually understanding, and have "saviour government" make it all feel better.

We've all got to be ashamed as claiming to be an advanced society...

We can talk about legitimacy when the annual arrest numbers do NOT correlate and coincide with emotional/financial recessions.

"Justice" indeed... phht!

Dave Donhoff
Leverage Planner

When ones plays with fire, the risk is high of getting burned.

The cases in our newspapers are not scapegoating. Someone allegedly used a stolen appraiser's identity and appraiser's license to make inflated, frauldulent appraisals. Straw buyers were used to get mortgages for people who could not qualify. Others are accused of keeping funds from terminated loans and investing the funds in the stock market. These do not sound like sound business practices that just got a little off the track to me.

The chickens have finally started to come home to roost....as predicted.

The current scam/bubble? OIL.

We've all got to be ashamed as claiming to be an advanced society..

Yes, because of all the people we have that take advantage of the elderly, uneducated, illiterate....

..trusting, naive....

So much for deregulation. It never works to have the fox guard the hen house.

Disney - I don't think Cleveland will do anything about their problems because they are in the mind set that its all someone else's fault. Don't misunderstand me, I'm all for prosecuting greedy banks/brokers/lenders who pursued bad loans aggressively. But I do not see ANYWHERE the part that overdevelopment played in this. Given permits, developers will develop and build. Its up to cities to do urban management and I think they have failed and continue to fail utterly. But no one is calling them on it. How much of Las Vegas' sitting inventory is new housing? How much of the older homes would have sold for a "normal" appreciation rate if development hadn't been crazy? City bureacrats in my opinion also "got the fever". They need to learn to say No.

Don't we legislate morality? I think we do, we have to. Many of our laws are at least in part legislating morality.