Thursday, March 17, 2011

Bust Your Bank, Get Sued

High-profile legal actions are always fun to watch.  This one's long overdue:

Federal bank regulators have sued three former top executives of Washington Mutual, the biggest U.S. bank ever to fail, accusing them of negligence in allowing risky mortgage lending.

Why does it take two and a half years for the FDIC to bring a lawsuit for negligence?  Uncle Sam sure takes his darn sweet time getting around to enforcing laws when wealthy people are accused of wrongdoing.  The only thing funnier than that is how the defendants claim the government treated them unfairly. 

It's hard to get sympathy when a permissive regulatory environment allowed mortgage fraud to go unchecked for years while both bankers and homeowners had access to ultra-low interest rates.  Everyone got a free ride.  There aren't any more free rides now.