Understanding why we should not expect a result from the Obama Mortgage Task force
Obama's Mortgage Task Force has had said about it "that is a great idea; but only if it also goes after the crooks in government based alliance that should be in jail, rather than in Congress". This statement is not far from the truth. The FBI has a mortgage task force in many of its field offices as part of these probes. It seems the FBI has a mortgage task force that has been going after people who have systematically been stripping homes to sell fixtures and fittings how is this mortgage fraud. This is like having a traffic cop on each corner in case there is an accident. It is like having DUI laws to prevent a problem that could be attended to prior the same way seat belts had been 40 years earlier with the breathalyzer. We (Government) don't want the problem solved just picked on like a scab.
Federal law enforcement agencies participating in the Mortgage Task Force include the United States Secret Service; Federal Bureau of Investigation; the Internal Revenue Service, Criminal Investigation; the United States Department of Housing and Urban Development, Office of Inspector General; and the United States Postal Inspection Service. If you add up their criminal justice knowledge it is daunting, but their true understanding of mortgage backed finance is as a novice no matter hat they say unless they have been told to stay away from certain purveyors of these crimes
The issue is never whether Washington will form a task force because that grabs headlines, the issue is does it know what tasks to perform. They know that today's headline is just waiting to be trumped by the next political gaff or missing child, etcetera. To put a political arm on what is easily one of the most preventable crimes in America is placing the fox in the hen house. True to form they have in the past 6 years really gone after no one who could fight back. This task force will in all probability go after what I would call small change. Those brokers/pseudo bankers who when attacked have all their assets taken and therefore can't fight back is the eventual target.
Anyone who fully understands the systemic nature as to how underwriting guidelines and due diligence are performed in the wholesale commercial banking arena knows this is attacking the result not the problem. I have seen FBI agents come into a meeting with a book on mortgages thinking they understand it. They have no clue, don't and never did understand securitization, the driving force of all this and therefore are attacking the result when with just a little bit of commitment they could be attacking the crime and eventually making it a better market that is liquid and negotiable. It boggles my mind when I see one more task force who is based upon being a part of a back burner agenda and then peddled off on the American people as action. "The truth", as Jack Nicholson said, "you can't handle the truth". The real reason is it would expose too many contributors to the next Billion dollar presidential campaign.
All the discussion on Mortgage Fraud was perpetrated by professionals in all areas of the real estate industry. It has become a cover all issue for everyone in the real estate industry to pass the buck in understanding what actually happened in the last decade and why. Mortgage fraud is a relatively low-risk, high-yield criminal activity that tempts many at the lower levels but the true crime is at the higher level of banking. It is pervasive and growing. It had a domino effect on local housing markets and the economy at large. Don't expect the real estate markets to get better, nor funding to be easier, nor this task force to solve any major problems other than low level criminal activity that they state can't financially cover or won't. Also when you really think about it most everyone stretches the truth and if every loan files was brought under review you would find 95% of them will have violated the federal law about false information on a HUD form carrying up to 20 years in prison. The solution is fix the problem instead of apply a salve over it. Ask me how and in my next article I will explain.
Federal law enforcement agencies participating in the Mortgage Task Force include the United States Secret Service; Federal Bureau of Investigation; the Internal Revenue Service, Criminal Investigation; the United States Department of Housing and Urban Development, Office of Inspector General; and the United States Postal Inspection Service. If you add up their criminal justice knowledge it is daunting, but their true understanding of mortgage backed finance is as a novice no matter hat they say unless they have been told to stay away from certain purveyors of these crimes
The issue is never whether Washington will form a task force because that grabs headlines, the issue is does it know what tasks to perform. They know that today's headline is just waiting to be trumped by the next political gaff or missing child, etcetera. To put a political arm on what is easily one of the most preventable crimes in America is placing the fox in the hen house. True to form they have in the past 6 years really gone after no one who could fight back. This task force will in all probability go after what I would call small change. Those brokers/pseudo bankers who when attacked have all their assets taken and therefore can't fight back is the eventual target.
Anyone who fully understands the systemic nature as to how underwriting guidelines and due diligence are performed in the wholesale commercial banking arena knows this is attacking the result not the problem. I have seen FBI agents come into a meeting with a book on mortgages thinking they understand it. They have no clue, don't and never did understand securitization, the driving force of all this and therefore are attacking the result when with just a little bit of commitment they could be attacking the crime and eventually making it a better market that is liquid and negotiable. It boggles my mind when I see one more task force who is based upon being a part of a back burner agenda and then peddled off on the American people as action. "The truth", as Jack Nicholson said, "you can't handle the truth". The real reason is it would expose too many contributors to the next Billion dollar presidential campaign.
All the discussion on Mortgage Fraud was perpetrated by professionals in all areas of the real estate industry. It has become a cover all issue for everyone in the real estate industry to pass the buck in understanding what actually happened in the last decade and why. Mortgage fraud is a relatively low-risk, high-yield criminal activity that tempts many at the lower levels but the true crime is at the higher level of banking. It is pervasive and growing. It had a domino effect on local housing markets and the economy at large. Don't expect the real estate markets to get better, nor funding to be easier, nor this task force to solve any major problems other than low level criminal activity that they state can't financially cover or won't. Also when you really think about it most everyone stretches the truth and if every loan files was brought under review you would find 95% of them will have violated the federal law about false information on a HUD form carrying up to 20 years in prison. The solution is fix the problem instead of apply a salve over it. Ask me how and in my next article I will explain.
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