U.S. Housing and Urban Development Secretary Shaun Donovan had this to say on behalf of the Obama Administration.
“Where any homeowner has been defrauded or denied the basic protections or rights they have under law, we will take actions to make sure the banks make them whole, and their rights will be protected and defended,” Donovan said at a Washington press briefing. “First and foremost, we are committed to accountability, so that everyone in the mortgage process — banks, mortgage servicers and other institutions — is following the law. If they have not followed the law, it’s our responsibility to make sure they’re held accountable.”
Wow! So, let me get this straight. The foreclosure industry and many banks have been foreclosing on homes with false affidavits and, very often, little or no documentation. They have been doing this for more than two years.
You have never caught any of them doing anything wrong for that entire two year period.
Tell me, at what point in time, did you discover you were committed to accountability? ‘Must have been sudden!
After you have ignored countless stories in the press over the last two years and finally, days ago, after all fifty state Attorney Generals have announced action, you organize a posse, mount up and ride for justice?
Well, problem solved!! All we have to do is wait for you to bring ’em in!
I’m so pleased. I’m so impressed. I’m touched by your devotion to justice. I’m awed by your dogged pursuit of wrong doers.
Right! And here’s what I really think.
You couldn’t find your butt with a 50,000 watt searchlight.
James Pilant
Pilant's Business Ethics Blog 
James,
You are giving an excellent update on the scenario and agree with on you it. One point which is not coming out, is whether the internal audit and fraud risk teams ever detected and reported these issues. And if they detected them, did the management ignore them or take action. Because it has to be a very dumb risk manager who can’t figure out what is occuring. In most cases if it is not reported, it is as per management directives. And if this is reported, it should be appearing in the reports to audit committees.
So from this angle what is really happening or have they just ignored it.
Sonia
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You are exactly right. Seeing your comment has upset me a bit. My reference to Housing and Urban Development being unable to find its own butt is not the epitome of gentlemanly behavior. I am embarrassed. On the other hand, I was angry. Not a good justification. jp
Nevertheless, I have been concerned about the point you raised and I have referred to it obliquely. Why would anyone take these chances with property filings which have the highest standards of virtually any set of contracts in English based law. I don’t get it. But I have suspicions. I still think they had so few actually documented possessions, they hoped to get as many done as possible before disaster struck. However, you take it from a different angle than I do and I want to hear more.
James Pilant
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James, I had done internal audit for a housing finance company as a consultant for a number of years in India. The company got a quarterly audit done from us on documentation, property papers etc and the branch reports used to go to regional head and HO. Each customer account where even a single paper was missing, the branch manager had to give a written explanation. The accumulated results were presented to the audit committee.
The scenario which you are mentioning is inconcievable in the Indian environment. I am not sure how this is occuring in USA, and that too for such a long time without any reporting.
Sonia
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Concentrations of power and influence, these are the only possible explanations for fraud on this scale. jp
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