New details announced on Obama’s mortgage crisis investigation

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We support reforms to the financial marketplace that protect consumers from unscrupulous banks and lenders.

By Consumers Union on Friday, January 27th, 2012

In his State of the Union Address on Tuesday, President Obama announced the creation of a special new joint federal-state Task Force charged with investigating the mortgage crisis and the resulting damage to homeowners and investors.  The Task Force is known as the Residential Mortgage-Backed Securities Working Group.  President Obama announced that New York Attorney General Eric Schneiderman will lead the Task Force as the Co-Chair to investigate those responsible for misconduct contributing to the financial crisis.

Today, Attorney General Schneiderman issued details about the core mission of the joint investigation into the mortgage crisis.   The Task Force will work with federal agencies including the Department of Justice, the Securities and Exchange Commission, several state law enforcement officials and other federal entitites to:

  • Hold accountable any institutions that violated the law;
  • Compensate victims and help provide relief for homeowners struggling from the collapse of the housing market, caused in part by this wrongdoing; and
  • To help us finally turn the page on this destructive period in our nation’s history.

Also, according to a memorandum issued today by the Office of the U.S. Attorney General, the investigation will focus on how fraud and misconduct in the residential mortgage backed securities (RMBS) market “contributed significantly to the collapse of the housing market, damaged the public’s trust and threatened the safety and soundness of our economy.”

For more details on the scope of the investigation, the additional co-chairs of the Task Force and a full list of the agencies participating in the Task Force, see the U.S. Attorney Generals January 27, 2011 memorandum.

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