Perhaps Tom Miller, the head of the executive committee negotiating a foreclosure fraud settlement, is feeling a little too much heat today. He just put out this statement on today’s meeting in Chicago (the site of protests):

(CHICAGO, Illinois) State Attorneys General from both parties, along with our federal partners, are today discussing the details of the progress we have made so far in settlement negotiations, including the terms we must still resolve. We have not yet reached an agreement with the nation’s five largest servicers, and we won’t reach a settlement any time this week.

That just seems like an effort to get his critics to stand down. Instead they’ve been increasing their rhetoric. AFL-CIO President Rich Trumka said today “We call on the administration to reject any deal that insulates banks from full responsibility.” Bob Borosage of the Campaign for America’s Future said “This is a fundamental question of justice and democracy.  The law is respected only if it is enforced.  No one who robbed a bank would be offered immunity, a modest fine and no admission of guilt – before there was an investigation into who stole the money and how much they took.” The co-chairs of the Congressional Progressive Caucus, Keith Ellison and Raul Grijalva, said “It’s past time we stand up to Wall Street and show the American people that no bank executive is above the law.”

On their own, these are the usual suspects. But there has been an impressive organizing force put together today to stop this settlement in its tracks. And let’s just go back to what this is all about, because it has very little to do with the usual media storylines and narratives running about. As Chris Hayes explains in this segment, somewhere along the lines the financial industry stopped keeping the records they were legally required to keep to ensure that they had standing to foreclose on borrowers. Instead of untangling the mess, they participated in a cover-up, by fabricating documents and affidavits on a mass scale to sucker courts into allowing foreclosures. That is no different than criminal theft. If I came into a courtroom looking to foreclose on a homeowner, and my proof of ownership was a plastic bag with the words “I OWNZ THAT” scrawled on it, that would be little different, under the eyes of the law, from what the banking industry has done over the last decade. Strip away all the complexities in the law and that’s what you’re left with.

So state and federal regulators attempting to settle with banks for stealing homes are really violently upsetting any pretense of a rule of law in America. Setting aside the fact that the penalty is completely inadequate and there’s no indication that banks will actually follow through on the specifics, some things are more important than a financial settlement can provide. The current group of big banks and loan servicers broke the richest market in the world, the residential US housing market. They really do need to pay for this. Because if they don’t, they will continue to violate the law as they have been doing unchecked for the past several years.

David Dayen

David Dayen