President Obama Toughens Stance On Wall Street Accountability

U.S. President Barack Obama toughened his stance on Wall Street, calling for the creation of a special financial crimes unit and pledging to “hold Wall Street accountable” in his State of the Union address.  

President Obama said he would ask the attorney general to create a special unit of federal prosecutors and state attorneys general to expand investigations into the abusive lending and packaging of risky mortgages that led to the housing crisis. 

“This new unit will hold accountable those who broke the law, speed assistance to homeowners, and help turn the page on an era of recklessness that hurt so many Americans,” said Obama. 

The announcement came in a speech that focused on the economy and accountability. “Let’s remember how we got here,” said President Obama. “Long before the recession, jobs and manufacturing began leaving our shores. Technology made businesses more efficient, but also made some jobs obsolete. Folks at the top saw their incomes rise like never before, but most hard-working Americans struggled with costs that were growing, paychecks that weren’t, and personal debt that kept piling up. 

“In 2008, the house of cards collapsed. We learned that mortgages had been sold to people who couldn’t afford or understand them. Banks had made huge bets and bonuses with other people’s . Regulators had looked the other way, or didn’t have the authority to stop the bad behavior. It was wrong. It was irresponsible. And it plunged our economy into a crisis that put millions out of work, saddled us with more debt, and left innocent, hard-working Americans holding the bag.”

The last major stock market crash after the millennial tech boom led to a spate high profile prosecutions and convictions at firms including Enron, WorldCom and Tyco. So far very few financial executives have been held accountable for the far larger credit crisis. 

“And I will not go back to the days when Wall Street was allowed to play by its own set of rules,” said Obama. 

AFL-CIO President Richard Trumka said: “Recognizing the need for accountability, the president powerfully insisted on a more humble Wall Street subject to a thorough investigation of the misconduct in the mortgage markets that wrecked our economy by the full range of federal and state civil and criminal authorities. We applaud the creation of a new mortgage crisis unit.” 

There had been speculation in congress that Obama might announce an agreement with the U.S.’s largest mortgage brokers over the so-called “robo-signing” scandal, in which bank officials signed foreclosure documents without properly reviewing them.

 Negotiations between the banks, state and federal officials have been going on for months and are expected to end in the largest settlement since 1998′s multi-state agreement with the tobacco industry. No agreement was announced, however, and several states, including New York and California, are believed to be unhappy with the agreement. 

Source: http://freeinternetpress.com

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