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The Federal Bureau of Investigation has broadened its probe of the subprime mortgage industry. They are investigating alleged accounting fraud, insider trading, and the securitization of loans. The F B I?s involvement raises the stakes, since the investigation could result in criminal charges.This crisis was inevitable. A national rash of bad practices, questionable loan approvals, and so- called ?creative? financing badly damaged the American housing industry. It doesn?t take a genius to figure out that the creative part included misrepresentation of the quality and security of the loans they originated.
Foreclosed homes decorate the American landscape, forcing homeowners who were in over their heads to pick up the pieces of their shattered lives and decimated credit. One could argue that these homeowners should have known better. But there is no doubt that those originating and selling these loans knew better.
Let justice be served and sanity restored.