(Sen Lieu has been a leader on the mortgage crisis. – promoted by Brian Leubitz)
By Sen. Ted W. Lieu
For those who may have missed, there was some good news coming out of Washington, D.C. and it did not involve Osama Bin Laden or the fact that our president was indeed born in the U.S.
Instead, it’s the fact the federal government is seeking more than $1 billion from Deutsche Bank for its role in the current U.S. financial crisis, kicking off the worst recession since the Great Depression.
It is about time. This lawsuit by the federal government against Deutsche Bank sends the message to Wall Street institutions that engaged in fraud and reckless behavior that they finally are going to be held accountable.
The bipartisan US Senate Investigation into what caused the financial crisis concluded that Deutsche Bank made mortgage loans knowing they were going to fail, misled investors about the quality of the loans and lied to the federal government.
While I want Wall Street and all businesses to prosper, because that is how we turn our economy around, we cannot turn a blind eye to fraudulent, reckless and potentially criminal behavior. Greed and insane bonuses are not a defense to violating the law.
As the author of several measures signed into law that prohibit certain sub-prime loan practices, I understand that consumers need their confidence restored. Punishing those responsible for this mess is a good start. The free market already took care of several Wall Street firms that lied and engaged in unconscionable behavior. Some of those financial institutions no longer exist, and for good reason. Deutsche Bank also had the additional hit to its image when they were sued Tuesday by the Los Angeles City Attorney for being a giant slumlord. Hmm. It seems Deutsche doesn’t want to follow either federal or state laws.
More work remains. There are some existing financial institutions that engaged in fraud, cheating and lying during the mortgage boom years, and the government is finally sending the message that we are coming after you. Justice will be done.
For more, visit Lieu’s Web site at the address below.
Ted W. Lieu represents nearly 1 million residents of Senate District 28, which includes the cities of Carson, El Segundo, Hermosa Beach, Manhattan Beach, Redondo Beach and Torrance, as well as portions of Long Beach, Los Angeles and San Pedro. For more, visit www.senate.ca.gov/lieu.