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Home Publications Blogs Beat the Press The Post and Iowa Assistant Attorney General Patrick Madigan Mislead Readers on Bank Settlement (see addendum)

The Post and Iowa Assistant Attorney General Patrick Madigan Mislead Readers on Bank Settlement (see addendum)

Wednesday, 31 August 2011 04:40

The Post ran an article on efforts to reach a settlement between 50 states suing banks over their mortgage issuance and foreclosure practices. The piece is about dissension among the plaintiffs, most notably New York Attorney General Eric Schneiderman, who is insisting on a stronger settlement that will address a wide range of abuses by the banks.

The piece is told primarily from the standpoint of those pushing for a quick settlement. Without comment it presents the clearly inaccurate assertion from Mr. Madigan in reference to Schneiderman's efforts to pursue a broader range of issues that:

"We don’t want to stop them from doing their investigation, and even if we wanted to, we couldn’t,  ... All states are sovereign.”

This is completely untrue. If there is a settlement, to which New York State is a party, that includes a list of abuses that the banks practiced in prior years, then New York State would be prohibited from taking further action on these issues. It is inconceivable that Mr. Madigan does not know this, so he was deliberately misrepresenting issues in his comment to the Post. The Post's reporters and editors should understand this basic fact as well.


[Addendum: Mr. Madigan notified me that his comment to the Post was in the context of saying that New York state could not be forced to be a party to a settlement that it felt was inappropriate. In this sense, it is true that Iowa's attorney general and the other attorney generals could not prevent NY from taking action on its own. He also said that the attorney generals have focused only on issues related to the servicing mortgages and not other potential legal problems stemming from issuance and securitization of mortgages.]

Comments (8)Add Comment
Sovereign Efficiency Trumps State Rights, Low-rated comment [Show]
A fond wish ...
written by John Puma, August 31, 2011 3:23
Would that I were presented with an ounce of gold for each "should" that (utterly justifiably) appears on this blog in regard reporters and editors of the NYT and WaPo.
Ninja Judo slagging
written by Downpuppy, August 31, 2011 5:15
For me the quote that defines the WaPo is:

Another person close to the talks, who like several others spoke on the condition of anonymity to discuss the situation more freely, said many in the group are “just exasperated. .?.?. This smear campaign of lies and innuendo, it’s uncalled for, it’s unprecedented, and it threatens substantial consumer harm.”

Is there nothing for which they won't grant anonymity?
written by Calgacus, August 31, 2011 7:57
Oh, boo-hoo. In other words, Madigan, Miller et al say: 49 of us 50 regulators have been bought off by the con men. But one, and unfortunately the most important one refuses to be bought! How are we going to get our cut if he doesn't play?

Time to expect a "scandal" involving Schneiderman.
written by Union Member, August 31, 2011 9:38

Did Madigan ask the Post to print a clarification?

This is just too odious a coincidence that such an important LAW ENFORCEMENT OFFICIAL and such a prominent national newspaper would be so unintentionally misleading regarding what is already colossal fraud which billowed the 8 trillion dollar asset bubble that wrecked the economy.

After Madigan asks the Post to print a clarification, the Post should ask Madigan why he's wasting time making deals that should be spent prosecuting criminals?
The Infamous.....
written by James, August 31, 2011 11:06

Misquote....I didn't mean that or didn't say that despite they generally receive a preview of the "printed" version.
written by Union Member, August 31, 2011 11:30

i hope Schneiderman takes the Martin Act and shoves it as far as it will possibly go! Maybe Obama will grow some balls and learn what it means to uphold the LAW!

Do macro-economic giants like Michelle Bachmann, Rick Perry, and Thomas Friedman know that the great Liberal/Progressive State of New York managed to have the most vital economy in the US for generations while at the same time being highly regulated, pro-union, a land of opportunity for immigrants and THE BIRTHPLACE of SOCIAL SECURITY (Sen Robert Wagoner NY, introduced it.) And much, much more. And, New York accomplished all this without any OI!

(Teddy Roosevelt established all those parks)

written by Mike Dillon, September 01, 2011 11:11
IA AG Miller has known about Mortgage Servicing Fraud and it's surrounding issues since at LEAST 2002 when he began receiving constituent complaints about then Fairbanks Capital Corp. Virtually every OTHER state AG has also been aware of MSF for years now as well and have done NOTHING. http://getdshirtz.com/index.ph...Itemid=135

AG Miller was also driving the bus on the Ameriquest.Argent deal that let Roland Arnall off the hook and enabled him to become a U.S. ambassador. Why should we expect anything different THIS time? http://www.institutionalinvest...ID=1025813

Elections are term-limiters. Keep trying new people until you find someone willing to protect U.S. consumers/homeowners/people as opposed to corporations.

Then again, if corporations are "people" they should be prosecuted for their criminal actions the same as any other "person" would. All it would take is one very big, public legal elbow to be thrown...

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.