What happens when NYS AG Eric Schneiderman tries to hold the banksters to account? The White House puts the screws to him

New York State Attorney General Eric Schneiderman -- Glenn Greenwald reminds us today that he predicted in May there was likely to be rough going for Schneiderman for refusing to roll over for Wall Street and the banksters, but he "assumed the pressure would come from the banks themselves, not from top Executive Branch officials."


"It is high time to describe the Obama Administration by its proper name: corrupt."

-- Yves Smith, the opening paragraph of her Naked Capitalism blogpost "Corrupt Obama Administration Pressuring New York Attorney General to Support Mortgage Whitewash"

by Ken

I don't know about you, but this literally makes me sick to my stomach.

You may recall that NYS Attorney General Eric Schneiderman (formerly my very own state senator, whose election as AG was one of the few bright lights to come out of the 2010 election) has been one of the few public officials unwilling to close the books on the question of criminal culpability connected with the economic meltdown. For one thing, he has refused to go along with the proposed settlement many of the state attorneys general are prepared to accept which would administer a resounding slap on the wrist to the economy-wrecking banksters. And for another, he has pursued investigations of his own.

Naturally this has annoyed the bankster nabobs. Actually, it seems to have annoyed them quite a lot. They just want to get on with their lives, which they're able to do thanks to all that cash we dumped in their laps because we were told that if we didn't, the world would come to an end. For a lot of Americans, jobless and homeless, the world pretty much has come to an end. The banksters, meanwhile, are raking in the dough and giving themselves bonuses as if they'd never been doing better. (And maybe they hadn't.)

You know and I know that it wasn't just temporary lapses in judgment on the part of those rich and powerful banksters which brought the economy down, somehow without bring the rich and powerful banksters down with it. To a lot of people who know more about this stuff than I do, it's pretty clear that crimes were committed, and at the very least somebody in law enforcement should have been taking a damned close look at where the law may have been crossed and how those lawbreakers can be called to account. Is it really not obvious that failure to hold criminals to account for their criminal behavior (a) legitimizes it and (b) contributes to the already out of control contempt those people have for the law? If they've come to think of themselves as above the law, well, can you blame them? They are above the law, aren't they?

It seems the banksters were so peeved with this Schneiderman fellow that they sent shock waves rolling all the way to our nation's capital, where it has turned out they could hardly have wished for a friendlier reception. It's hard to imagine the most business-friendly Republican administration going into action more quickly or more forcefully, bringing pressure to bear on this Schneiderman fellow to get in line with the administration line.

Here's Gretchen Morgenson writing in the NYT:

Attorney General of N.Y. Is Said to Face Pressure on Bank Foreclosure Deal

Eric T. Schneiderman, the attorney general of New York, has come under increasing pressure from the Obama administration to drop his opposition to a wide-ranging state settlement with banks over dubious foreclosure practices, according to people briefed on discussions about the deal.

In recent weeks, Shaun Donovan, the secretary of Housing and Urban Development, and high-level Justice Department officials have been waging an intensifying campaign to try to persuade the attorney general to support the settlement, said the people briefed on the talks.

Mr. Schneiderman and top prosecutors in some other states have objected to the proposed settlement with major banks, saying it would restrict their ability to investigate and prosecute wrongdoing in a variety of areas, including the bundling of loans in mortgage securities.

But Mr. Donovan and others in the administration have been contacting not only Mr. Schneiderman but his allies, including consumer groups and advocates for borrowers, seeking help to secure the attorney general’s participation in the deal, these people said. One recipient described the calls from Mr. Donovan, but asked not to be identified for fear of retaliation. . . .

Mouthpieces for Secretary Donovan and for various functionaries in the Justice Dept. (whose nominal boss, AG Eric Holder, has -- not exactly uncommonly -- been mostly invisible) have chirped back indignantly that no, they're really on the side of the besieged homeowners and muscling this Schneiderman fellow into being sensible will actually benefit the . . . oh, I'm sorry, it's too ridiculous even to repeat.

There's really nothing for me to add to what's already been written by some of the biggest guns in the noncaptive media: Marcy Wheeler ("2 Funny Things about Obama Administration’s Effort to Pressure Eric Schneiderman"; is it necessary to specify that Marcy doesn't mean ha-ha funny?), Yves Smith (the post from which I quoted at the top, "Corrupt Obama Administration Pressuring New York Attorney General to Support Mortgage Whitewash"), and Glenn Greenwald ("Obama administration takes tough stance on banks").

Glenn has the advantage of writing after, and quoting from, Marcy and Yves (Glenn also directs attention to "this article from Joseph Stiglitz on how failure to criminally prosecute mortgage fraud would destroy the rule of law"; the Stiglitz piece, by the way, is headed "Justice for Some"), though he's at pains to point out that he wrote in May "about the commendable -- one might say heroic -- efforts of New York State Attorney General Eric Schneiderman to single-handedly impose meaningful accountability on Wall Street banks for their role in the 2008 financial crisis and the mortgage fraud/foreclosure schemes."

Near the end of his piece today, Glenn quotes from the wind-down of his May post:

It is worth keeping a watchful eye on Schneiderman's investigative efforts and doing everything possible to provide what will undoubtedly be much-needed support if, as appears to be the case, he is serious about taking on these pernicious factions and impeding the conspiring by the political class to protect their benefactors/owners.

He adds now, though: "I assumed the pressure would come from the banks themselves, not from top Executive Branch officials." He goes on to suggest that it's not just the Senate that, as Senate Majority Whip Dick Durbin put it, the banks "frankly own" -- that they hold the deeds to both houses of Congress and another piece of property on Pennsylvania Avenue as well.

Its present tenant seems to be doing all he can to ensure that the next one is the likes of, say, Willard (I'm thinking Willard Romney should be known by just one name, like Charo or Cher) or Rick Perry.

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