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Piggybankblog posted 05/03/12
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Cross linked with nydailynews.com
In the last decade, the United States experienced the biggest housing bubble in the history of the world. When the bubble burst, Americans lost $7 trillion in household wealth, millions of jobs disappeared and the nation was plunged into the deepest and longest recession in 70 years.
There have recently been some mischaracterizations of the mortgage-backed securities working group created in January by President Obama to investigate the roots of this crisis — a working group I am proud to co-chair.
Here are the facts.
My office — along with the Justice Department, the SEC, the Consumer Financial Protection Bureau, the IRS and our other partners — is working aggressively to provide accountability for any misconduct that contributed to the bubble and crash in the housing market. More than 50 attorneys, investigators and analysts have already been deployed to support our investigations, with many more on the way. The President has requested a congressional appropriation of an additional $55 million to ensure that we have the resources to do a thorough job.
However, this is a law enforcement exercise, not a public policy decision, and must proceed in a rigorous and deliberate fashion. Like any ongoing investigation, the details about the scope of our inquiry are confidential. But I remain committed to following the facts wherever they may lead.
The reckless deregulation and irresponsible conduct that brought down the American economy must be systematically investigated. At the same time, we must deliver as much immediate relief as possible to protect families whose homes are at risk now.
New York has a pretty good set of laws to protect against wrongful foreclosure. But those laws are of little use to the many New York homeowners — about half — who faced foreclosures in recent years without a lawyer.
That’s why, when I joined my fellow state attorneys general to negotiate a settlement with the five largest mortgage servicing banks over abusive servicing and foreclosure practices, I made it a top priority to get immediate funding for legal services for homeowners facing foreclosure.
On April 5, our office received court approval of a settlement that comprehensively reforms mortgage servicing and the foreclosure process, and commits the banks to reaching out and working with New Yorkers whose homes are underwater. Thousands of New York families should receive reduced interest rates or actual reductions in principal owed.
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