California and New York Attorney Generals are going to start prosecuting loan origination fraud, including lenders who ignored borrower's ability to repay. The laws have always been on the books, so they can go as far back as the statute of limitations will allow them.
If I were a lender who had done business in one of those two states I would be packing right now, headed for a non-extradition territory with as much of my loot as I could carry.
I don't think that is going to happen. I think that the banks are going to stall the lawsuits and finance competitors to these AGs. And I am afraid that the cost for all of this is going to be borne by the little people, as banks raise fees and/or lower interest rates.
But it is the right thing to do. The past cannot be fixed, but the future can only be salvaged if we start enforcing the rule of law.
Noted for May 24, 2013
12 minutes ago