"The US Department of Justice says Bank of America employees were involved in illegal conduct including a conspiracy to rig bids on investments linked to municipal bonds." - Bank of America Admits FraudI've been noticing on various message boards there are many people who still take the position in defense of banks as if Americans who obtained mortgages are the perpetrators of crime and deserve to be foreclosed upon. The general perception of these people is the borrowers shouldn't have taken out a mortgage for a home they couldn't afford. The reality is few people can really afford any home these days because few know what the future holds for their jobs in the shaky U.S. economy.
People who think the banking crises in America is due to those who took advantage of banks are ignorant of the facts, probably the types who always believe anything they're told by authority figures. The reality is the banks made a killing during the real estate boom by reselling the borrower's mortgages in the derivatives market. The reason banks offered easy no question home loans is they could actually make more money on the derivatives market. Banks also coordinated inflated appraisals of properties in order to make it appear the property assets on their books were higher then they actually were.
Today it's very easy to denote evidence that the profitable derivatives market is why banks provided easy no question loans to people.
Banks do a fantastic job in their marketing materials making you feel like they're your pal giving you a nice shiny personalized debit and/or credit card. Bank employees tend to be very nice and friendly too. The sad thing is, bankers who run these institutions that employs friendly people are neither your friend nor my friend. These banks took 2.2 trillion dollars from U.S. taxpayers holding our country hostage claiming the market and economy was going to crash in 2008. They've got their little pundits all over the country claiming it's all Americans fault for purchasing homes they couldn't afford. The bottom line is, this is a rigged game. The banks knew what they were doing and what the outcome would be from the outset.
“This ongoing investigation has helped to expose wide-spread corruption in the municipal reinvestment industry,” Robert Khuzami, director of the S.E.C.’s Division of Enforcement, said in a statement. “The conduct was egregious — in return for business, the company repeatedly paid undisclosed gratuitous payments and kickbacks and affirmatively misrepresented that the bidding process was proper.” - New York TimesThousands of Americans have since lost their homes and the "ships are abandoned" so to speak, the work of pirates on the high seas of the real estate market.
Unfortunate Error by Bank and a Home is Gone - MSNBC.com