The Department of Justice's Investor-Unfriendly Mortgage Settlements
In reaching mortgage-related settlements with the big banks, the Department of Justice forgot about investors.
In late January, the U.S. Senate held confirmation hearings for President Obama’s nominee for attorney general, Loretta Lynch. One question that senators should have asked Lynch: Are you an advocate for investors in a way that the current attorney general, Eric Holder, was not?
In the aftermath of the global financial crisis, the Justice Department might be fairly criticized for many things, including--according to some commentators--failing to hold individual bank executives accountable for alleged criminal activity. (See Matt Taibbi’s recent Rolling Stone article for one such account.) You may or may not believe that bank executives should have gone to jail. But it is undeniable that the Justice Department’s mortgage-related settlements with the major banks failed to reflect investor interests.
Scott Cooley does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.