The Financial Crisis Inquiry Commission is investigating the causes of the U.S. financial crisis and has been holding hearings. The commission has been looking into the assertion that in 2004 the FBI issued a warning of a looming outbreak of mortgage fraud. Attorney General Eric Holder has been questioned about whether the FBI acted on the warning and, if so, what the agency did. Risky banking practices and very poor regulation led to the worst financial crisis in the United States since the Great Depression. It will be interesting to see what the FBI and Department of Justice did as a result of the FBI’s 2004 warning.
Attorney General holder told the bipartisan panel exploring the root causes of the U.S. financial crisis that the Justice Department is using “every tool at its disposal” to fight the financial crimes that contributed to the meltdown and certainly could cause another. He believes fighting financial crime will foster confidence in the system and I totally agree with him. Anybody or any entity that committed a crime should be investigated and prosecuted.
It has become quite obvious that the financial crisis exposed some fundamental weaknesses in the regulatory system. The Obama administration has proposed a sweeping overhaul of the system. Currently, both the House and the Senate are working on separate bills. A new interagency Financial Fraud Enforcement Task Force was created by President Obama to coordinate efforts between the Justice Department and other agencies. Mortgage fraud and a number of large financial crimes have been exposed and the SEC has come under fire for failing to detect the frauds and criminal activities years before the crisis.
Our law firm apparently knew more than the federal government did in some areas of concern. For example, our lawyers have been filing civil lawsuits against a number of the financial institutions for years. We knew that they were playing fast and loose in a number of areas and that the regulatory system was failing to do its job. Congress must now take the necessary steps to make sure we don’t have another financial crisis in this country.
Source: USA Today
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