You remember this, right?
This was the statement that led, in no small part, to President Clinton being impeached. I know that a lot of people tend to think of the whole thing as a sex scandal, and it was widely referred to as Monicagate, but the legal basis on which the President of the United States was impeached was on allegedly false statements made under oath during the investigation of the allegations that he had a sexual affair with Monica Lewinsky. The legal basis for impeachment of the President of the United States was perjury, which the Republicans, and many Democrats, in the House alleged was a High Crime and/or Misdemeanor within the meaning of the U.S. Constitution. Out of sacred respect for the law, and to uphold the integrity of the U.S. legal system, for only the second time in history, a sitting U.S. President was brought up on articles of impeachment. For Perjury.
I wrote a diary a couple days ago, Obama on Banking: "Zero Credibility. ZERO.", addressing the administration's credibility on mortgage relief, the housing crisis, and the President's new campaign as an anti-Wall Street crusader, in which I quoted rather extensively from Mike Lux's article at Crooks and Liars.
I want to revisit one aspect of that, which I think deserves a little more attention.
But if the administration rams through this ultimate in Wall Street sweetheart deals — a laughably pocket change fine combined with “credit” for what they would have done anyway, at the expense for a get out of jail free card for 1 million counts of perjury and a wide range of other potential fraud [emphasis added] — they will have zero credibility to run as the tough on Wall Street candidate. ZERO. . . .
What Mike is referring to in that sentence is what has come to be known as the "robo-signing" scandal, an industry-wide practice which is both illegal, and systematically in use even as I write this. Matt Stoller posted on this at Naked Capitalism:
What makes these discussions so utterly absurd, so ridiculous, and farcical, is that robo-signing, an abuse the banks have admitted to and clam they’ve ceased, is still going on. The AP reported this in July; mortgage servicers in Nevada have stopped foreclosing because of a law explicitly criminalizing robo-signing. Yes, the banks are asking for a release of claims on acts, or perhaps crimes, that are ongoing. And these abuses are extensive: lying to investors about the quality of the mortgages; violating their own contracts by failing to convey mortgages properly to securitization trusts; charging fees that are impermissible under Federal law and the contracts; making a mess of property records and engaging in deceptive consumer practices through the use of MERS; and engaging in document forgeries and fabrications in foreclosures. All these people trying to give the banks “a settlement” are in fact immunizing banks against acts they are committing and will commit going forward. [snip]
We’re talking about an ongoing case of criminal theft of private property by mortgage servicers charging illegal fees and then using fraudulent documents to foreclose.
I'm not an expert in criminal law throughout all 50 states, but I do know this: in my state, to knowingly submit a false document into evidence is a felony. Like armed robbery. It's considered a more dangerous crime than domestic assault which is only a misdemeanor, unless there are aggravating circumstances. Hell, even if you beat a pregnant woman, knowing she's pregnant, it's still just a misdemeanor, with a maximum penalty of 1 year and/or a $1,000 fine. But submit a fraudulent document into evidence, you can get 5 years and a $50,000 fine. Think that's bad? Wanna know what the maximum possible penalty is for perjury?
14 years in the State Pen.
Because the entire justice system depends, absolutely, on keeping the legal process, and proceedings, honest. Without that, you don't have law and order, you don't have a justice system, you have no real forum for the redress of grievances. You may as well move to Somalia, or the Old West, or anywhere where everyone knows that the only "justice" there is comes at the "business" end of a smoking gun.
When I took my oath to uphold and defend the rule of law and the Constitution of my State, and the United States, the Judge who swore me in brought an old Colt .45 into the Courtroom. "Whenever you feel down about your profession, or the justice system, just remember; this is how we used to settle our differences in this State. You are now members of an honorable profession, because your profession saves lives."
If Mike Lux's number is right, and we have every reason to believe that it is, the amount of fraud perpetrated in and on our "justice" system is sufficient, all by itself, to completely undermine and destroy that system. Think about the scale we are talking about here: and forget the underlying fraud, i.e., the individual frauds upon homeowners, investors, and the like. Forget the counties and states who've been defrauded out of millions? Billions? of recording fees and the like as a result of MERS and the failure to properly record mortgage instruments. Forget the false fees, the overcharges, the endless run-arounds, the deceptive practices, forget all of that, and concentrate just on the perjury alone. 1 Million counts of perjury. The maximum penalty for that, in my state, would be 14 Million years.
That's longer than humans have walked the face of the earth.
14 Million years ago, the Earth looked like this:
14 Million years ago, the Amazon was a giant marsh, feeding into the Carribbean.
The Amazon, the world's largest river, used to be a large wetland connected to the Caribbean until 14 million years ago, when the uplift of the Andes mountains caused an enormous change in continental drainage, blocking westward flow, creating the river as we know it today formed, flowing into the Atlantic Ocean.
According to Grace Shephard, Professor Dietmar Müller and a team of international colleagues who have reported their discovery in the journal Nature Geoscience, progressive continental tilting established a gently inclined drainage surface that forced water from a giant catchment to flow to the east, starting at about 14 million years ago.
And our ancestors looked like this:
And carbon in the atmosphere was around 400 ppm.
Beginning to get a feel for the scale of the assault on our justice system?
For those who want to defend this administration, this President and his Treasury Secretary, who are desperately pushing a deal to sweep all this under the rug with a slap on the wrist, while this fraud is still ongoing, do you really think our civilization can survive, if this is what our court system is reduced to?
Now, for the good news. Former Senator Ted Kaufman has an article up over at HuffPo:
If we look back on the Fall of 2011 a few years from now, however, I suspect we may trace the beginnings of real reform from two events that occurred last week with little fanfare. The first of the two events was when Federal District Court Judge Jed S. Rakoff refused to approve a settlement with Citigroup that the S.E.C. had proposed. The second was the lawsuit filed by Delaware Attorney General Beau Biden in the Delaware Court of Chancery accusing the Mortgage Electronic Registration System (MERS) of deceptive trade practices. [snip]
Refusing to approve the S.E.C.'s $285 million settlement with Citigroup, which was accused of fraud in the sale to investors of $1 billion of Collateralized Debt Obligations, Judge Rakoff demanded that, before any settlement was approved, the S.E.C. first answer a number of questions. They are great, commonsense questions -- exactly the ones that should have been asked in a whole string of prior big bank settlements. Among them:
• Why is the penalty in this case to be paid in large part by Citigroup and its shareholders rather than by the 'culpable individual offenders acting for the corporation? ... If the SEC was for the most part unable to identify such alleged offenders, why was this?
• What specific 'control weaknesses' led to the acts alleged in the Complaint?... How will the proposed 'remedial undertakings' ensure that those acts do not occur again?
Do you think for a moment that the average target of an investigation would get a deal that did not include answers to these questions?
AG Biden's suit is the result of concerns he and New York AG Eric Schneiderman have expressed for some time about the potential settlement between the banks and the 50 State AGs. Those settlement talks began after the exposure of widespread problems with MERS and the banks' foreclosure procedures, including the practice of filing affidavits in court in which the lenders' employees claimed they had personal knowledge when they did not. Many documents had been "robo signed" or signed without being read. Essential documents were lost or destroyed. Files simply disappeared. Evidence of falsified documents is widespread.
As an attorney, almost every day I have to talk to clients about possible testimony, and I have a professional obligation to advise them regarding the possible consequences of perjury, and have to deal with the anger that many have when they perceive that a witness, or another party, isn't telling the truth. Thus, this aspect of the whole mortgage/banking/fraud industry is probably the most repugnant aspect, to me. I'm not the best attorney in the world, but I at least try to practice in an honest fashion, and take the duty of candor to the Court seriously.
But these foreclosure mills, that are still routinely submitting perjurious affidavits and falsified documents, many of them are submitted by people who may be licensed to practice law, but are, by just about any definition, criminals and a disgrace to my profession. I've seen attorneys prosecuted, disbarred, and put in jail for falsifying a temporary custody order, and these people are committing felonies multiple times a day.
There is no excuse for this. None. One of the greatest innovations in civilization is the creation of Courts for the resolution of disputes. Without a Court system that at least tries to uphold some standard of honesty, there can be no justice, and our entire civilization stands at risk. When faced with fraud on this scale, what possible justification is there for sweeping it under the rug? This is a battle over whether or not we will be, in fact, a civilized nation or not. And I just can't help but be dismayed at the seemingly utter lack of respect that our President, a Harvard educated Professor of Constitutional Law, seems to have for the rule of law. Thankfully, we live in a country where there are multiple governmental entities, and there are at least some willing to stand up for the rule of law.
2:18 PM PT: It's funny, I never know which diaries are going to get noticed around here. Anyway, I'm out of time and have to go. Thanks to all who've stopped by.