More help from my friends

Bank friendly courts

Judges for the banks
As a rule, courts take the part of the banks. Still, few are so outspoken as the judge who said that if the bank was foreclosing, he wasn't going to consider any evidence that the foreclosure was in error.
In 39 states, judges are elected. In 2003, the US Chamber of Commerce spent at least $100 million on the election of sympathetic judges (there is no reason to believe that there is less now); for somebody in banking, a judicial election could be better investment than a congressional campaign.

Spurious claims against borrowers' lawyers
The banks have many methods to fight litigations from abused borrowers. A common ruse is filing spurious claims against the borrowers' lawyers. Even if it fails, it takes time and money to fight back.
On the other hand, should the banks have to pay the homeowner's costs after losing a case, they are not happy; should they have to pay when they are caught breaking the law, they get very upset (Yes, Virginia. There are judges who do not bow to the banks).

Big ones go free...
In 2007, Countrywide bank proudly told analysts they sold mortgages to Fannie Mae that were "far below" even generous limits for subprime but still considered "prime" by Fannie.
In all, an estimated $1 trillion to $4.8 trillion in fraudulent mortgages were issued in 2005 to 2007; still criminal cases against the banks are very rare. There are some prosecutions of low tier individuals, some large civil suits, some cases of financial penalties instead of criminal charges.
It is not only when it comes to fraudulent mortgages that the banks get away free or almost free. JPMorgan Chase was caught disregarding controls for criminal activity, including business with drug trafficking organizations and terroristic regimes. The bank was fined $88.3 million (a paltry sum considering the money involved); it also got a 22 pages order of things to do to fix the problem. A year and a half later, JPMorgan is still refusing to monitor its customers and they are getting away with it without anything happening.

...small fry sentenced
In the whole country, only one bank has been indicted for mortgage fraud. Abacus, a bitty little Chinese bank, was proudly paraded by the New York District Attorney. Abacus had lied about loans it sold to Fannie Mae. Still, Abacus' rate of default was less than 10% of the average for all Fannie's loans; according to the bank's own calculations, Fannie had earned more than $174 million in interest on Abacus' mortgages. If all fraudulent banks had been like Abacus, there had been no financial crisis.
Karen Gasparian at the small G&A Check Cashing company in LA also got in trouble. In one year, his crime amounted to a bit over $100,000. He got five years in prison for doing the same thing as JPMorgan's CEO Jamie Dimon unpunished did on a much bigger scale: not complying with the Bank Secrecy Act.

Neither guilty nor innocent
Of around one thousand Federal Reserve Bank enforcement actions in the last ten years, more than 99% were resolved without admitting or denying wrongdoing; instead of getting a sentence, the transgressing bank agrees to pay some fee. This is a policy pursued by both The Office of the Comptroller of the Currency and by the Securities and Exchange Commission, two main governmental agencies supposed to keep Big Finance within the law.
This practice has at least three consequences. 1) The bank can contend that it was pressured to accept the fee although it was innocent. 2) Without a guilty verdict, it is difficult for victims to sue for damages. 3) Had there been a number of guilty verdicts, the bank's behavior could be seen as a pattern of racketeering and thus punishable under the RICO act. No matter how many transgressions there are, if the culprits get away with neither admitting nor denying guilt, legally there is no pattern.

The decay of law
Fraud and criminal conduct used to be pursued by regulators and the FBI. Bush sr's reaction to the Savings and Loan was unequivocal: "We aim for a simple, uncompromising position. Throw the crooks in jail". Under Bush jr, references to the criminal referral coordinators disappeared or were removed from the bank examiners' manuals. FBI staffing for white collar crime was cut drastically. Obama administration has done nothing to restore criminal referrals. This has granted the elite bankers who led the fraud epidemics de facto immunity from prosecution.

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