Allocation of National Mortgage Settlement

Have you wondered about what really happened to the money negotiated through the National Mortgage Settlement Agreement? I wonder. I still wonder. Nobody seems to know exactly where the money went. A recent article on The Bryan Ellis Investing Letter breaks it down, sort of. Nobody seems to know where all the money went. I looked at on the site for the National Conference of State Legislators and found a break down for allocations state by state which was published around the time of the settlement date. The allocation of funds for Florida follows. But how the money was actually spent, remains a mystery. It seems abundantly clear that the monies did not go to beleaguered former homeowners who had already lost their homes in foreclosure.

FLORIDA ALLOCATION OF NATIONAL MORTGAGE SETTLEMENT MONIES:

$334,073,974.00 - Florida's Share

$35 million for down payment assistance;
$10 million for housing counseling;
$5 million for the state court system to help with foreclosure-related issues;
$5 million to the Office of the Attorney General to fund legal aid programs;
$9,117,895 to the Florida Prepaid Tuition Scholarship Program;
$5,262,579 to the state courts system to provide technology solutions that expedite foreclosure cases through the judicial process;
$16 million to the state courts system to provide supplemental resources to reduce the backlog of pending foreclosure cases;
$9.7 million to the clerks of the court to enhance service levels to assist and support the courts in expediting processing backlogged foreclosure cases;
$10 million to the Office of the Attorney General to provide legal aid to low- and moderate-income homeowners facing foreclosure;
$10 million to the Department of Children and Families for capital improvements to certified domestic violence centers;
$20 million to Habitat for Humanity of Florida;
$50 million to reduce rents on new or existing rental units through the State Apartment Incentive Program;
$10 million to fund the construction or rehabilitation of units through the State Apartment Incentive Loan Program;
$40 million to fund the State Housing Initiative Program;
$10 million to the Department of Economic Opportunity to fund a competitive grant program to provide housing for homeless persons;
$10 million to the Department of Economic Opportunity to fund a competitive grant program to provide housing for persons with developmental disabilities;
$5 million to the Office of the Attorney General to reimburse the office for costs and fees;
The remaining funds are directed to the state General Fund as civil penalties.

And stated on the Florida Attorney General, Pam Bondi's site:

"Attorney General Bondi formally entered a landmark $25 billion joint federal-state agreement with the nation's five largest mortgage servicers over foreclosure abuses and unacceptable nationwide mortgage servicing practices. The proposed agreement provides an estimated $8.4 billion in relief to Florida homeowners and addresses future mortgage loan servicing practices. The settlement generally releases civil claims related to robo-signing, other foreclosure-related abuses, and loan origination misconduct, but it provides no release of criminal claims or of claims related to mortgage securitization.

'This settlement will provide substantial relief to struggling Florida homeowners, and ensures that our state gets its fair share of the relief being provided nationally,' stated Attorney General Pam Bondi. "This agreement holds banks accountable and puts in place new protections for homeowners in the form of strict mortgage servicing standards.'"

AND

"Florida’s share of the total monetary benefits under the settlement is approximately $8.4 billion.

• Florida borrowers will receive an estimated $7.6 billion in benefits from loan modifications, including principal reduction, and other direct relief.
• Approximately $170 million will be available for cash payments to Florida borrowers who lost their home to foreclosure from January 1, 2008 through December 31, 2011 and suffered servicing abuse.
• The value of refinanced loans to Florida’s underwater borrowers would be an estimated $309 million.
• The state will receive a direct payment of $334 million.

In addition to the terms of the national settlement agreement, Attorney General Bondi separately negotiated an agreement with the nation’s three largest mortgage servicers to ensure that a guaranteed portion of the overall settlement funds goes to Florida borrowers.

For more information about eligibility and filing a claim:
Website: NationalMortgageSettlement.com
Email: administrator@nationalmortgagesettlement.com
Call toll-free: 1-866-430-8358 (Hearing Impaired: 1-866-494-8281).
*The line is staffed Monday through Friday from (7 a.m. to 7 p.m. Central)."

In fact, some former homeowners received checks for $300.; and a few others I know of received around $1400. The state of Florida has gleefully participated in the fleecing of Florida citizens perpetrated by the banks and that fleecing continues to this day. The mortgage crisis and great recession is the result of the biggest Ponzi scheme ever that makes Bernie Madoff look like a kindergartner.

If I had never purchased a home, a potential first time home buyer, there is no way that I would buy a home now. Not in this economy. Not after witnessing these recent events. I would stay home with Mom as long as she could stand it, and then after that I would rent. The media can blame the slow down in purchases on the weather, or alternately claim that the mortgage crisis ended. But, you don't need a weatherman to tell which way the wind blows.  

Confused about Florida's real real estate recovery?

I used the search string - Florida real estate recovery 2014 - 


and received the following collection of conflicting results:


2014 looks like another good year for Florida real estate, but ...
www.heraldtribune.com/.../20140210/.../30210...‎



Housing recovery will slow in 2014: Florida Realtors
tbo.com/.../housing-recovery-will-slow-in-2014-flori...‎





Debt Repayment in Florida Hurt by Sluggish Real Estate ...
www.bloomberg.com/.../2014.../debt-repayment-in-flori...‎

STORY: Foreign Buyers Drive Florida's Housing Recovery
www.businessweek.com/.../foreign-buyers-driv...‎

..
Florida housing market heating up again - Chicago Tribune
articles.chicagotribune.com › ... › Fort Myers‎



...
Housing recovery radar: Where are the next hot spots?
www.cnbc.com/id/100961977‎





There's economic optimism for 2014 …but not a lot - Miami ...
www.miamiherald.com › Business‎

Top 10 real estate trends for 2014 - CBS News
www.cbsnews.com/news/top-10-real-estate-trends-for-2014/‎

..
Florida Home Prices and Home Values - Zillow
www.zillow.com/fl/home-values/‎







After a Slow Start, Florida's Housing Market Recovery Picks ...
pascoflrealestate.typepad.com/...realtor/2014/.../after-a-slow-start-floridas...‎



Mar 26, 2014 - ORLANDO, Fla. – March 26, 2014 – Florida was one of the first states to feel the effect of a national recession with job losses starting in April ...

Street Crime is Down - White Collar Crime is UP

The good news is that street crime is down. A recent study attributes the decrease in street crime to the fact that people carry less cash nowadays. According to the National Bureau of Economic Research (NBER) Working Paper: Less Cash, Less Crime: Evidence from the Electronic Benefit Transfer Program (No. 19996, 3/14) crimes have decreased since the 1990s due to welfare recipients using debit cards instead of receiving checks or paper food stamps. Cash benefits, child support payments, and food stamps are all automatically loaded onto an EBT card, no cash in the process. The abstract for that paper states:

"It has been long recognized that cash plays a critical role in fueling street crime due to its liquidity and transactional anonymity. In poor neighborhoods where street offenses are concentrated, a significant source of circulating cash stems from public assistance or welfare payments. In the 1990s, the Federal government mandated individual states to convert the delivery of their welfare benefits from paper checks to an Electronic Benefit Transfer (EBT) system, whereby recipients received and expended their funds through debit cards. In this paper, we examine whether the reduction in the circulation of cash on the streets associated with EBT implementation had an effect on crime."

Attributing the decline in crime to less cash, is a new perspective. Law enforcement and social scientists have explained the decrease in crime in a number of other ways.

One of the reasons often cited for the decline in crime is that we lock up so many people nowadays. According to the Prison Policy Initiative - "Looking at the big picture requires us to ask if it really makes sense to lock up 2.4 million people on any given day, giving us the dubious distinction of having the highest incarceration rate in the world."

Another piece of the puzzle is that we now have far more laws than in the past. People can break a law that they never new existed, and find themselves behind bars. The old saying, ignorance of the law is no excuse, no longer applies. Nobody knows all the laws. According to an article in The Economist:

"The number of federal laws has risen from 3,000 in the early 1980s to over 4,450 by 2008. Many of these have poor intent requirements, meaning people are being locked up not to keep the rest of society safe, but for technical violations of laws they may not have known existed."

If the pace of law creating has continued, then, now in 2014, we have double the number of laws as we did in the 1980s. And we are only counting federal laws. State and local law makers also have to justify their existence by continuing to create and pass more and more laws everyday.

More prisons and jails. Follow the money. The cheapest labor anywhere, even less than third world countries is found right here in America at the Gray Bar Hotel. There are now over 100 private prisons in the United States. Quoting an article about the prison industry in general:

"The prison industry complex is one of the fastest-growing industries in the United States and its investors are on Wall Street. “This multimillion-dollar industry has its own trade exhibitions, conventions, websites, and mail-order/Internet catalogs. It also has direct advertising campaigns, architecture companies, construction companies, investment houses on Wall Street, plumbing supply companies, food supply companies, armed security, and padded cells in a large variety of colors.”

According to the Left Business Observer, the federal prison industry produces 100% of all military helmets, ammunition belts, bullet-proof vests, ID tags, shirts, pants, tents, bags, and canteens. Along with war supplies, prison workers supply 98% of the entire market for equipment assembly services; 93% of paints and paintbrushes; 92% of stove assembly; 46% of body armor; 36% of home appliances; 30% of headphones/microphones/speakers; and 21% of office furniture. Airplane parts, medical supplies, and much more: prisoners are even raising seeing-eye dogs for blind people."

And THAT was the good news. The bad news is that although street crime, crime for cash is down. White collar crime is thriving. The stats presented below are not recent. However, the rate of increase seems to be similar or accelerated since the 1990s. This is an excerpt from a early 2000s article on the National White Collar Crime Center's website (NW3C):

"White collar crime is a term that is applied to nonviolent crimes committed in business situations by individuals, groups or corporations for the purpose of financial gain. Most white collar crimes are associated with some type of fraud, often involving a lending institution, such as a bank or insurance agency.

Examples of white collar crime include: antitrust fraud, bankruptcy fraud, bribery, computer fraud, credit card fraud, counterfeiting, embezzlement, identity fraud, insider trading, insurance fraud, kickbacks, money laundering, obstruction of justice, perjury and price fixing.

White collar crime is steadily on the rise, thanks to our technologically advancing society, which relies on the increased use of cellular phones and computers to access personal and financial information. The National White Collar Crime Center (NW3C), a nonprofit agency that supports state and local police in their efforts to prevent, investigate and prosecute economic and high-tech crime, reports that while arrests for violent crimes have decreased in recent years, arrests for white collar crimes - especially fraud and embezzlement - have increased.

The rise in white collar crime incidents has also contributed to a rise in cost to the nation. According to National Fraud Center statistics, the cost of economic crime has risen from $5 billion in 1970 to $100 billion in 1990, and is only expected to increase as occurrences become more frequent. ....

Statistics from NW3C also approximate that one in three households is the victim of white collar crime, yet of these, only 41 percent report the incident. Of the small number reported, only 21 percent are handled by a law enforcement or consumer protection agency."

Corporate crime inflicts far more damage on society than all street crime combined. Whether in bodies or injuries or dollars lost, corporate crime and violence wins by a landslide.

The FBI estimates, for example, that burglary and robbery -- street crimes -- costs the nation $3.8 billion a year.

The losses from a handful of major corporate frauds -- Tyco, Adelphia, Worldcom, Enron -- swamp the losses from all street robberies and burglaries combined.

Health care fraud alone costs Americans $100 billion to $400 billion a year. The savings and loan fraud -- which former Attorney General Dick Thornburgh called "the biggest white collar swindle in history" -- cost us anywhere from $300 billion to $500 billion.

Recent White Collar Crime Stats

The latest available data from the Justice Department show that during January 2014 the government reported 561 new white collar crime prosecutions. According to the case-by-case information analyzed by the Transactional Records Access Clearinghouse (TRAC), this number is up 0.5% over the previous month.

The largest number of prosecutions of these matters in January 2014 was for "Fraud-Financial Institution", accounting for 15 percent of prosecutions. Prosecutions were also filed for "Fraud-Other" (15%), "Fraud-Tax" (14.1%), " Fraud-Identity Theft-Aggravated" (13.2%), "Fraud-Federal Program" (9.6%), "Fraud-Identity Theft-Other" (7.8%), "Fraud-Health Care" (6.2%), "Fraud-Other Business" (3.6%), "Fraud-Computer" (2.7%), "Fraud-Telemarketing" (2.1%).

Remember, only a small percentage of white collar crime is even reported. And a scant 21% of the reported crimes are ever prosecuted.

In an article by Ben Steverman "Why Drug Lords and Criminals Are SoRisk-Averse" on Bloomberg.com, "convicted felon Sam E. Antar says stock-picking -- trusting in people and numbers you can’t directly verify -- sets you up as a mark for the unscrupulous. Antar was the chief financial officer of Crazy Eddie, Inc., an electronics chain led by Sam’s cousin, Eddie Antar. The chain collapsed under the weight of its fraud in 1989. “Investors live on hope and it’s the criminal’s job to take advantage of that hope,” Antar says:

'If I wanted to be a scam artist today, I could be very, very successful,” he says. “I’d probably have less risk of being prosecuted and far less risk of going to prison.'

So do you think that the worldwide mortgage crisis is the result of sloppy paperwork? Far more harm is done to consumers by a thief with a briefcase than by an army of purse snatchers.

Wall Street Owns the Country

Wall Street Owns The Country

A Speech by Mary Elizabeth Lease (circa 1890)

"This is a nation of inconsistencies. The Puritans fleeing from oppression became oppressors. We fought England for our liberty and put chains on four million of blacks. We wiped out slavery and our tariff laws and national banks began a system of white wage slavery worse than the first. Wall Street owns the country. It is no longer a government of the people, by the people, and for the people, but a government of Wall Street, by Wall Street, and for Wall Street. The great common people of this country are slaves, and monopoly is the master. The West and South are bound and prostrate before the manufacturing East. Money rules, and our Vice-President is a London banker. Our laws are the output of a system which clothes rascals in robes and honesty in rags. The [political] parties lie to us and the political speakers mislead us. We were told two years ago to go to work and raise a big crop, that was all we needed. We went to work and plowed and planted; the rains fell, the sun shone, nature smiled, and we raised the big crop that they told us to; and what came of it? Eight-cent corn, ten-cent oats, two-cent beef and no price at all for butter and eggs-that's what came of it. The politicians said we suffered from overproduction. Overproduction, when 10,000 little children, so statistics tell us, starve to death every year in the United States, and over 100,000 shopgirls in New York are forced to sell their virtue for the bread their niggardly wages deny them... We want money, land and transportation. We want the abolition of the National Banks, and we want the power to make loans direct from the government. We want the foreclosure system wiped out... We will stand by our homes and stay by our fireside by force if necessary, and we will not pay our debts to the loan-shark companies until the government pays its debts to us. The people are at bay; let the bloodhounds of money who dogged us thus far beware."

And so it goes ...

Again - 13 Billion is NOT Enough

The 13 Billion Dollar settlement negotiated between Eric Holder and Jamie Dimon is not enough to pay for JP Morgan's crimes. Although it sounds like a whole lot of dollars, watch the video reposted from You Tube - Alexis Breaks it Down sent to me by The Other 98%. According to Rana Foroohar as reported in Time Magazine, this fine is the worst possible outcome.

Why?

Because nothing changes. Their hands are slapped, and life goes on. Too big to fail = Too big to jail. In the Statement of Facts filed with the settlement, JP Morgan was aware that many of the loans bundled and securitized were of low quality. 

And most of the 13 Billion is tax deductible. The taxpayers take it again. According to NPR:


"More than half of the record settlement amount will be tax-deductible, the banking giant said Tuesday.
'It's our understanding that the $2 billion penalty will not be tax-deductible, Lake said, 'but that the remaining $7 billion of compensatory payments will be deductible for tax purposes."

And:

"The Justice Department has issued this breakdown of the $9 billion in the settlement that's not tied to consumer aid:

• $2 billion - civil penalty to settle the Justice Department claims under the Financial Institutions Reform, Recovery, and Enforcement Act
• $1.4 billion - to settle federal and state securities claims by the National Credit Union Administration
• $515.4 million - to settle federal and state securities claims by the Federal Deposit Insurance Corporation
• $4 billion - to settle federal and state claims by the Federal Housing Finance Agency
• $298.9 million - to settle claims by the State of California
• $19.7 million - to settle claims by the State of Delaware
• $100 million - to settle claims by the State of Illinois
• $34.4 million - to settle claims by the Commonwealth of Massachusetts
• $613.8 million - to settle claims by the State of New York"

And:

"The settlement represents only a fraction of JPMorgan's $23 billion litigation reserve fund, which it has called a hedge against future legal fees and judgments. That reserve was described in the bank's third-quarter corporate filings, as Lake said in a conference call held Tuesday afternoon."



Business as usual, the cost of doing business, tax deductible, nobody goes to jail.