As of March 26, we're $27,100 in the red for the quarter. Donate here to support this vital work
Subscribe here and join over 13,000 subscribers to our free weekly newsletter

Doubt Is Cast on Firms Hired to Help Banks
Key Excerpts from Article on Website of New York Times


New York Times, January 31, 2013
Posted: February 12th, 2013
http://dealbook.nytimes.com/2013/01/31/doubt-is-cast-on-firm...

Federal authorities are scrutinizing private consultants hired to clean up financial misdeeds like money laundering and foreclosure abuses, taking aim at an industry that is paid billions of dollars by the same banks it is expected to police. The consultants operate with scant supervision and produce mixed results, according to government documents and interviews with prosecutors and regulators. In one case, the consulting firms enabled the wrongdoing. The deficiencies, officials say, can leave consumers vulnerable and allow tainted money to flow through the financial system. The pitfalls were exposed last month when federal regulators halted a broad effort to help millions of homeowners in foreclosure. The regulators reached an $8.5 billion settlement with banks, scuttling a flawed foreclosure review run by eight consulting firms. In the end, borrowers hurt by shoddy practices are likely to receive less money than they deserve, regulators said. Critics concede that regulators have little choice but to hire outsiders for certain responsibilities after they find problems at the banks. The government does not have the resources to ensure that banks follow the rules. Some banks that work with consultants continue to run afoul of the law. At other times, consultants underestimate the extent of the misdeeds or facilitate them, preventing regulators from holding institutions accountable.

Note: For deeply revealing reports from reliable major media sources on the criminal practices of the financial industry, click here.


Latest News


Key News Articles from Years Past