Like 9/11 Attacks, Federal Agencies Missed Clear Warning Signs of Financial Crisis
By BRIAN ROSS, RHONDA SCHWARTZ, and JOSEPH RHEE
Oct. 6, 2008As Congress opens hearings this morning on who is to blame for the financial crisis, an ABC News investigation has found that the FBI and other federal agencies failed to spot the warning signs of massive fraud in the home mortgage business that led directly to Wall Street.
“The failure to connect the dots,” Connecticut Attorney General Richard Blumenthal told ABC News, “is completely reprehensible and should now lead to strong and effective indictments and prosecutions for fraud.”
Evidence of widespread fraud and deception in the home mortgage business was presented to the FBI, the SEC and the Federal Reserve Board chairmen, Alan Greenspan and Ben Bernanke, over the last five years but resulted in no comprehensive or coordinated federal reaction, according to Blumenthal, other officials, business leaders, class action lawyers and civil rights activists.
In July, 2007 a coalition of civil rights groups met with Federal Reserve chairman Ben Bernanke in Washington, D.C., to present concerns that minority homeowners were being particularly hard hit by predatory lenders whose tele-marketing schemes resulted in hundreds of thousands being tricked into mortgages they could not afford, and ultimately were forced into foreclosure.
“I’m disappointed more could not, or was not done in the aftermath of that meeting,” said Wade Henderson, president of the Leadership Conference on Civil Rights, who arranged the meeting with Bernanke…
Tags: civil rights, clear warning signs, fbi, federal reaction, financial crisis, home mortgage business, sec, widespread fraud and deception
October 6, 2008 at 2:30 pm |
Good points raised here.