"Eric Schneiderman"

"Eric Schneiderman" by citizenactionny on flickr

So, hot on the heels of revelations Team Obama has been out in force twisting the arm of one NY Attorney General, Eric Schneiderman, to release bankers from darn near all liability for any crimes, mistakes or civil infractions they may have committed during the economic collapse or anytime thereafter (by this point, the man has taken the concept of “don’t look back” to pathological levels), signs quickly emerged that the approach wasn’t going so well … and subsequently it emerged BoA isn’t doing so well with investors when there may be an outside chance they would actually have to play by the rules. Today comes the news that Eric Schneiderman has been summarily removed from the the 50-state task force committee charged with probing foreclosure abuses and potentially negotiating a settlement. (via huffpo)

 

The email announcing Schneiderman’s dismissal from the states’ executive committee was sent just after noon to more than 50 people by Patrick Madigan, a top lawyer in the Iowa Attorney General’s Office. It read: “Effective immediately, the New York Attorney General’s Office has been removed from the Executive Committee of the Robosigning multistate.”

…[Schneiderman spokesman, Danny Kanner] said Schneiderman was removed at Iowa Attorney General Tom Miller’s “prerogative.”

Miller, through a spokesman, said that Schneiderman was “intimately involved in every aspect of this investigation and possible settlement” from the launch of the probe last October to this past June. Schneiderman was “on every internal [executive committee] conference call and participated in all conference calls and meetings with the top five mortgage servicers. As such, New York had a large influence on the actions and decisions of the multistate.”

But in June, after The Huffington Post reported on a confidential conference call between state and federal officials, the executive committee was reduced to a smaller group of states that would directly negotiate with the five banks. Schneiderman was invited to join this smaller group, but declined, Miller said.

“Since that time, New York has actively worked to undermine the very same multistate group that it had spent the previous nine months working very closely with,” Miller continued. “While we certainly respect the right of any state to choose to no longer participate in a multistate and to pursue another path, working to actively undermine a multistate while still a member of the Executive Committee simply doesn’t make sense, is unprecedented and is unacceptable. Accordingly, today I informed New York that it is no longer a member of the Executive Committee.”

Schneiderman’s removal will likely make it easier for state and federal officials to reach an accord with the five banks. However, the potential amount of money they’ll be able to extract will likely decrease.

This task force was formed, somewhat surprisingly, by the Attorney General for that hotbed of foreclosures and banking, Iowa … ostensibly to probe the depths of banker malfeasance. Oooooorrrrr, maybe because Tom Miller achieved a deep longing to befriend a bunch of New York bankers and help ram through the deal they knew would be forthcoming from Obama’s crew. One of those.

Back in April, The National Institute on Money in State Politics released an interesting report on our friend Mr. Miller. Among other things, it was reported:

A detailed look at the campaign contributions made to Iowa Attorney General Tom Miller reveals several interesting giving patterns.

First, however, these contributions have to be put into the larger context of Tom Miller’s involvement in last fall’s foreclosure moratorium, which began when Ally Financial (formerly GMAC), JPMorgan Chase, and Bank of America halted their foreclosure proceedings in dozens of states between September 20 and October 1, 2010.

On September 24, Miller announced that his office was opening a civil investigation of Ally Financial’s foreclosure processes in Iowa. Two weeks later, on October 7, Miller’s office issued a press release stating that Miller had spoken to representatives of JPMorgan Chase, Ally Financial, and Bank of America regarding their foreclosure proceedings; as well as “assigned staff to convene a separate group of bipartisan state attorneys general and state banking regulators to coordinate states’ reviews and responses to the troubling disclosures by mortgage companies.”

Almost a week later, on October 13, Miller’s office made the official announcement that his office was coordinating a 50-state effort to examine foreclosure practices by major financial lenders.

Miller’s major contributions from out-of-state lawyers and firms closely tracks these developments. Between September 30 and Election Day, Miller received $170,300 from lawyers outside of Iowa, which is two-thirds of all the money he raised from them during the entire two-year election cycle. (For a more detailed, day-by-day timeline of Miller’s contributions from lawyers and lobbyists, see his contributions timeline).

Although it is typical for candidates to raise large sums of money in the month immediately preceding the election, Miller’s out-of-state donations in 2010 were a significant departure from his two previous campaigns, in terms of the amount of money he raised, where it came from, and when.

  • Miller raised , more than double the $327,196 he raised for his 2006 and 2002 campaigns .$785,000 in 2010combined
  • Miller’s 2010 campaign was unprecedented in the amount of contributions received from outside of Iowa: $497,000, or 63 percent of his 2010 total, came from out-of-state donors. This is a significant break from his previous two reelection campaigns, when less than one-tenth of his campaign funds came from outside of Iowa.

Even more interesting is that it was the lawyers and donors from the finance, insurance, and real estate (FIRE) sector from outside of Iowa who were largely responsible for this reversal. Out-of-state lawyers and lobbyists gave Miller $261,445 in 2010, which is 88 times more than they gave over the previous decade. Out-of-state donors from the FIRE sector gave Miller $56,150 in 2010, compared to $3,500 in 2006 and $1,000 in 2002.

Rolling Stone’s Matt Tabibi did a highlight of the report’s findings at the time

Attorney General Tom Miller – who is coordinating the investigation into the banks’ improper mortgage dealings – increased his campaign contributions from the finance sector this year by a factor of 88! He has raised $261,445 from finance, insurance and real estate contributors since he announced that he was going to be coordinating the investigation into improper foreclosure practices. That is 88 times as much as they gave him not over last year, but over the previous decade.

This is about as perfect an example of how American politics works as you’ll ever see.

Indeed. He also touches on what’s at stake and who is contributing here.

If the banks had to pay what they actually owed – from the registration taxes/fees they avoided by using the electronic registry system MERS to the money taken from investors in toxic mortgage-backed securities to the fees and payments stolen from homeowners via predatory loan practices and illegal foreclosures – they would probably all go out of business. That’s how much money is at stake here: the very future of financial giants like Bank of America and Citi and JP Morgan Chase is hanging to a very significant degree on the decisions of politicians like Miller.

Hence the sudden avalanche of money sent Miller’s way. The numbers are laughable. In 2006, out -of-state donors gave Miller’s campaign $10,508. For the 2010 cycle, that number was $497,357. Three lawyers by themselves – Al Gore’s attorney David Boies, plus Donald Flexner and Robert Silver, all partners in the firm Boies, Schiller and Flexner – gave Miller a total of $60,000.

[...] Goldman [Sachs] hired Boies to represent it in a fight against the now-defunct Basis Yield Alpha Fund, which bought into Goldman’s notorious “Timberwolf” deal – one of the “shitty deals” Senator Carl Levin, in hearings last year, was haranguing Goldman for selling to unsuspecting clients.

So now we see that Boies and a string of other banker lawyers (including firms that represented Citi, Chase, Wachovia, and others) are throwing tens of thousands of dollars at Miller. Maybe it won’t do much to influence Miller, but who knows? Maybe he won’t plunge the knife in quite so deep now.

Just something to keep an eye on.

Again. Indeed. And the answer seems to be that he not only intends to avoid plunging the knife in at all … he wants to make sure nobody else messes with his plans to protect his new-found benefactors. It appears Miller is to banking fraud investigations as Simpson is to debt reduction.

(originally posted on kgblogz.com)