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Elizabeth Warren Embarrasses Hapless Bank Regulators At First Hearing

Posted by on Feb. 15, 2013 at 8:30 AM
  • 12 Replies

WASHINGTON -- Bank regulators got a sense Thursday of how their lives will be slightly different now that Elizabeth Warren sits on a Senate committee overseeing their agencies.

At her first Banking, Housing and Urban Affairs Committee hearing, Warren questioned top regulators from the alphabet soup that is the nation's financial regulatory structure: the FDIC, SEC, OCC, CFPB, CFTC, Fed and Treasury.

The Democratic senator from Massachusetts had a straightforward question for them: When was the last time you took a Wall Street bank to trial? It was a harder question than it seemed.

"We do not have to bring people to trial," Thomas Curry, head of the Office of the Comptroller of the Currency, assured Warren, declaring that his agency had secured a large number of "consent orders," or settlements.

"I appreciate that you say you don't have to bring them to trial. My question is, when did you bring them to trial?" she responded.

"We have not had to do it as a practical matter to achieve our supervisory goals," Curry offered.

Warren turned to Elisse Walter, chair of the Securities and Exchange Commission, who said that the agency weighs how much it can extract from a bank without taking it to court against the cost of going to trial.

"I appreciate that. That's what everybody does," said Warren, a former Harvard law professor. "Can you identify the last time when you took the Wall Street banks to trial?"

"I will have to get back to you with specific information," Walter said as the audience tittered.

"There are district attorneys and United States attorneys out there every day squeezing ordinary citizens on sometimes very thin grounds and taking them to trial in order to make an example, as they put it. I'm really concerned that 'too big to fail' has become 'too big for trial,'" Warren said.

A Warren constituent, open-Internet activist Aaron Swartz, recently committed suicide after being hounded by federal prosecutors who reportedly said they wanted to "make an example" of him. Warren had met and said she admired Swartz and, after he died, expressed her concern by attending his memorial in Washington.

The financial regulators can blame, at least in part, Wall Street lobbyists (along with outgoing Treasury Secretary Tim Geithner and Senate Republicans) for their embarrassing turn at the hearing. Warren would have been on the panel herself representing the Consumer Financial Protection Bureau, instead of a sitting senator, if her nomination to head the agency hadn't been thwarted in 2011

http://www.huffingtonpost.com/2013/02/14/elizabeth-warren-bank-regulators_n_2688998.html

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If they enforced bank regulations like they do park rules, we wouldn't be in this mess

by on Feb. 15, 2013 at 8:30 AM
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brookiecookie87
by Platinum Member on Feb. 15, 2013 at 8:31 AM
3 moms liked this

Well put.

Quote:

"There are district attorneys and United States attorneys out there every day squeezing ordinary citizens on sometimes very thin grounds and taking them to trial in order to make an example, as they put it. I'm really concerned that 'too big to fail' has become 'too big for trial,'" Warren said.

brookiecookie87
by Platinum Member on Feb. 18, 2013 at 1:40 PM

Regrets? Some Senators Have a Few

Editorial Director

Watching Elizabeth Warren grill regulators has some Senators wishing they didn't oppose her appointment to the CFPB back in 2011.

February 15, 2013

A number of US Senators probably felt pretty good about themselves when they made it clear that there was no chance that they would support Elizabeth Warren's appointment to head the Consumer Financial Protection Bureau. As a result, President Obama declined to even nominate Warren to head the CFPB, saying that the administration was convinced she "could not overcome strong Republican opposition."

Careful what you wish for. Today, those senators are likely kicking themselves after they saw what happens when someone won't take no for an answer. Since Warren couldn't head the CFPB, she ran for the Senate, won and is on now the Senate Banking Committee. Awkward.

As the senior Senator from Massachusetts (John Kerry resigned to become Secretary of State), Warren gave everyone in the banking world an example of what life will be like now that she is a Senator.

Yesterday, she took the opportunity at her first Senate Banking Committee meeting to tear into the top regulators from the nation's financial service regulators (FDIC, SEC, OCC, CFPB, CFTC, Fed and Treasury). Remember, if she was allowed to be the head of the CFPB, she would have been on the other side of the room yesterday, answering softball questions from Senators who probably don't know the difference between a retail bank and an investment bank.

After a few pleasantries, Warren asks her very direct question: when was the last time regulators took a large bank to trial? Not to a settlement, where the bank admits no wrongdoing, but an actual trial where executives are forced to testify under oath?

The answers were not surprising. No one could recall the last time a large bank had been dragged in front of a court. A few regulators tried to dodge the question and explain to Warren why its better to settle with a bank for a fine than go to trial.

Take a look, it's very entertaining:

Warren wasn't buying it. She pointed out that if the banks know in advance that there is no chance they will be ever brought to trial because the regulator lacks the conviction or the resources to do so, the regulator will have less leverage during a settlement negotiation. "If they can break the law and drag in billions in profits and then turn around and settle, paying out of those profits, there is not much incentive to follow the law," Warren said during her opening comments.

She also notes that without trials and the days of testimony, the public never really ever knows what the banks did, since the settlements are behind closed doors.

When she didn't get an answer to her question, she asked it again. For instance, she asked Tom Curry, Comptroller of the Currency at the OCC, "What I am asking is … when did you last take a large financial institution, a Wall Street bank, to trial?"

Currey contended that the OCC gets "consent orders," or settlements, and doesn't have to bring banks to trial. Elisse Walter, chairman of the SEC, also tried to point out that the SEC has reached settlements, but was not able to tell the committee the last time the SEC brought a bank to an actual trial.

The entire interaction between Warren and the regulatators takes about four minutes and makes for great theater. You can even hear snickers and applause from the audience. If you are looking for evidence that some Senators actually know something about banking, here you go.

Visit CSPAN to view the full video of the Senate Banking Committee hearing (Warren's interrogation starts at 1:34:30).

lga1965
by on Feb. 18, 2013 at 1:54 PM
2 moms liked this
She should run for President in 2016.
Posted on CafeMom Mobile
tscritch
by Silver Member on Feb. 18, 2013 at 1:59 PM
1 mom liked this

 I saw the video of this. Man did she have them stammering. I really like her!

eema.gray
by on Feb. 18, 2013 at 5:47 PM

I'll have to check YouTube . . . . 

I don't know anything, really, about her but she sounds like the sort of politician we should be electing more of.  :-)



Quoting tscritch:

 I saw the video of this. Man did she have them stammering. I really like her!



"I am only one, but I am still one; I cannot do everything, but still I can do something; and because I cannot do everything I will not refuse to do the something that I can do." ~~ Edward Everett Hale 1822-1909
gludwig2000
by Gina on Feb. 18, 2013 at 6:11 PM

 I'm glad to hear that someone is finally demanding that the "too big to fail" banks and Wall Street will finally be held accountable for their actions. She is right in saying that if they know that they won't go to trial, then they have nothing to fear when breaking the law.

grandmab125
by Gold Member on Feb. 18, 2013 at 6:34 PM
1 mom liked this

 Bullshit.

A video has been making the rounds of Sen. Elizabeth Warren, D-Mass., getting non-answers from various regulators during her first Banking, Housing and Urban Affairs Committee hearing.

Warren asked a very simple question to the various regulators — “Can you identify the last time when you took the Wall Street banks to trial?” The FDIC, SEC, Federal Reserve, Treasury Department and other regulators have not taken any Wall Street banks to trial.

The closest the federal government will go to taking anyone to trial over the financial crisis and housing meltdown will be a lawsuit against Standard & Poor’s Ratings Services for, in the words of the Department of Justice press release,

a scheme to defraud investors in structured financial products known as Residential Mortgage-Backed Securities (RMBS) and Collateralized Debt Obligations (CDOs). The lawsuit alleges that investors, many of them federally insured financial institutions, lost billions of dollars on CDOs for which S&P issued inflated ratings that misrepresented the securities’ true credit risks. The complaint also alleges that S&P falsely represented that its ratings were objective, independent, and uninfluenced by S&P’s relationships with investment banks when, in actuality, S&P’s desire for increased revenue and market share led it to favor the interests of these banks over investors.

There are surely those who should be sued or prosecuted for the financial crisis, but the best anyone could actually do is vote the bulk of the culprits out of office.

The banks themselves have been left alone. Regardless of political persuasion, many have wondered why no banks were prosecuted or otherwise sued in civil litigation for the financial crisis and housing market meltdown. What most miss is that many of the banks were only doing what the federal government made them do.

Former Treasury Secretary Hank Paulson forced many banking institutions into accepting TARP funds during the financial crisis, threatening the well-run banks with increased regulator action.

Paulson and Federal Reserve Chairman Ben Bernanke sent Bank of America into a tailspin, forcing it to buy Merrill Lynch even though Bank of America wanted out of the deal. According to the Wall Street Journal, Bank of America CEO Ken Lewis

told investigators for New York Attorney General Andrew Cuomo that in December Mr. Paulson threatened him not to cancel a deal to buy Merrill Lynch. BofA had discovered billions of dollars in undisclosed Merrill losses, and Mr. Lewis was considering invoking his rights under a material adverse condition clause to kill the merger. But Washington decided that America's financial system couldn't withstand a Merrill failure, and that BofA had to risk its own solvency to save it.

The Treasury Department went on to approve big pay raises for AIG, Ally Financial and even General Motors, despite all their financial problems.

As the libertarian CATO Institute and others have noted, the federal government created the conditions, laws and regulations that directly led to the financial crisis. The Community Reinvestment Act, assorted regulations, Fannie Mae, Freddie Mac and Congress itself all created incentives and demands for banks to make bad loans to people who could not repay them. These laws, regulations and institutions all made it harder and harder for banks to make money in traditional ways, causing banks to take more and more risks to break even.

There are surely those who should be sued or prosecuted for the financial crisis, but the best anyone could actually do is vote the bulk of the culprits out of office. The rich irony of Elizabeth Warren asking her question to these regulators, whose ranks she would have joined but for a Republican effort to block her nomination prior to her Senate run, is that she is an advocate of increasing the very regulations that contributed to the financial meltdown and that prevent suits against Wall Street banks. After all, Wall Street was just complying with Washington’s orders.

In a final irony, the legislation designed to prevent this all from happening again, commonly called Dodd-Frank, has institutionalized the idea that certain banks are “too big to fail” and put smaller banks at a competitive disadvantage. More and more American assets are held by fewer and fewer banks thanks to ideas advocated by people like Sen. Elizabeth Warren.

If she wants a scalp, she should look in the mirror.

Erick Erickson is a Fox News contributor and editor of RedState.com. Follow him on



Read more: http://www.foxnews.com/opinion/2013/02/18/if-elizabeth-warren-wants-to-lay-blame-for-financial-mess-can-look-in-mirror/#ixzz2LIR07Sim

 

brookiecookie87
by Platinum Member on Feb. 18, 2013 at 7:48 PM
1 mom liked this


Oh no someone is asking bank regulators actual questions. Better go to Fox News Opinion pieces to tell us what we want to hear!

Quoting grandmab125:

 Bullshit.

Erick Erickson is a Fox News contributor and editor of RedState.com. Follow him on



Read more: http://www.foxnews.com/opinion/2013/02/18/if-elizabeth-warren-wants-to-lay-blame-for-financial-mess-can-look-in-mirror/#ixzz2LIR07Sim




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If they enforced bank regulations like they do park rules, we wouldn't be in this mess

stacymomof2
by Ruby Member on Feb. 18, 2013 at 9:37 PM

How does this article make any part of the OP bullshit?  It's like a handful of feathers thrown in someone's face to try to confuse them  Just not relevant.

Quoting grandmab125:

 Bullshit.

A video has been making the rounds of Sen. Elizabeth Warren, D-Mass., getting non-answers from various regulators during her first Banking, Housing and Urban Affairs Committee hearing.

Warren asked a very simple question to the various regulators — “Can you identify the last time when you took the Wall Street banks to trial?” The FDIC, SEC, Federal Reserve, Treasury Department and other regulators have not taken any Wall Street banks to trial.

The closest the federal government will go to taking anyone to trial over the financial crisis and housing meltdown will be a lawsuit against Standard & Poor’s Ratings Services for, in the words of the Department of Justice press release,

a scheme to defraud investors in structured financial products known as Residential Mortgage-Backed Securities (RMBS) and Collateralized Debt Obligations (CDOs). The lawsuit alleges that investors, many of them federally insured financial institutions, lost billions of dollars on CDOs for which S&P issued inflated ratings that misrepresented the securities’ true credit risks. The complaint also alleges that S&P falsely represented that its ratings were objective, independent, and uninfluenced by S&P’s relationships with investment banks when, in actuality, S&P’s desire for increased revenue and market share led it to favor the interests of these banks over investors.


There are surely those who should be sued or prosecuted for the financial crisis, but the best anyone could actually do is vote the bulk of the culprits out of office.


The banks themselves have been left alone. Regardless of political persuasion, many have wondered why no banks were prosecuted or otherwise sued in civil litigation for the financial crisis and housing market meltdown. What most miss is that many of the banks were only doing what the federal government made them do.

Former Treasury Secretary Hank Paulson forced many banking institutions into accepting TARP funds during the financial crisis, threatening the well-run banks with increased regulator action.

Paulson and Federal Reserve Chairman Ben Bernanke sent Bank of America into a tailspin, forcing it to buy Merrill Lynch even though Bank of America wanted out of the deal. According to the Wall Street Journal, Bank of America CEO Ken Lewis

told investigators for New York Attorney General Andrew Cuomo that in December Mr. Paulson threatened him not to cancel a deal to buy Merrill Lynch. BofA had discovered billions of dollars in undisclosed Merrill losses, and Mr. Lewis was considering invoking his rights under a material adverse condition clause to kill the merger. But Washington decided that America's financial system couldn't withstand a Merrill failure, and that BofA had to risk its own solvency to save it.

The Treasury Department went on to approve big pay raises for AIG, Ally Financial and even General Motors, despite all their financial problems.

As the libertarian CATO Institute and others have noted, the federal government created the conditions, laws and regulations that directly led to the financial crisis. The Community Reinvestment Act, assorted regulations, Fannie Mae, Freddie Mac and Congress itself all created incentives and demands for banks to make bad loans to people who could not repay them. These laws, regulations and institutions all made it harder and harder for banks to make money in traditional ways, causing banks to take more and more risks to break even.

There are surely those who should be sued or prosecuted for the financial crisis, but the best anyone could actually do is vote the bulk of the culprits out of office. The rich irony of Elizabeth Warren asking her question to these regulators, whose ranks she would have joined but for a Republican effort to block her nomination prior to her Senate run, is that she is an advocate of increasing the very regulations that contributed to the financial meltdown and that prevent suits against Wall Street banks. After all, Wall Street was just complying with Washington’s orders.

In a final irony, the legislation designed to prevent this all from happening again, commonly called Dodd-Frank, has institutionalized the idea that certain banks are “too big to fail” and put smaller banks at a competitive disadvantage. More and more American assets are held by fewer and fewer banks thanks to ideas advocated by people like Sen. Elizabeth Warren.

If she wants a scalp, she should look in the mirror.



Erick Erickson is a Fox News contributor and editor of RedState.com. Follow him on



Read more: http://www.foxnews.com/opinion/2013/02/18/if-elizabeth-warren-wants-to-lay-blame-for-financial-mess-can-look-in-mirror/#ixzz2LIR07Sim



grandmab125
by Gold Member on Feb. 18, 2013 at 9:53 PM

 Elizabeth Warren is grandstanding......

Quoting stacymomof2:

How does this article make any part of the OP bullshit?  It's like a handful of feathers thrown in someone's face to try to confuse them  Just not relevant.

Quoting grandmab125:

 Bullshit.

A video has been making the rounds of Sen. Elizabeth Warren, D-Mass., getting non-answers from various regulators during her first Banking, Housing and Urban Affairs Committee hearing.

Warren asked a very simple question to the various regulators — “Can you identify the last time when you took the Wall Street banks to trial?” The FDIC, SEC, Federal Reserve, Treasury Department and other regulators have not taken any Wall Street banks to trial.

The closest the federal government will go to taking anyone to trial over the financial crisis and housing meltdown will be a lawsuit against Standard & Poor’s Ratings Services for, in the words of the Department of Justice press release,

a scheme to defraud investors in structured financial products known as Residential Mortgage-Backed Securities (RMBS) and Collateralized Debt Obligations (CDOs). The lawsuit alleges that investors, many of them federally insured financial institutions, lost billions of dollars on CDOs for which S&P issued inflated ratings that misrepresented the securities’ true credit risks. The complaint also alleges that S&P falsely represented that its ratings were objective, independent, and uninfluenced by S&P’s relationships with investment banks when, in actuality, S&P’s desire for increased revenue and market share led it to favor the interests of these banks over investors.

 

There are surely those who should be sued or prosecuted for the financial crisis, but the best anyone could actually do is vote the bulk of the culprits out of office.

 

The banks themselves have been left alone. Regardless of political persuasion, many have wondered why no banks were prosecuted or otherwise sued in civil litigation for the financial crisis and housing market meltdown. What most miss is that many of the banks were only doing what the federal government made them do.

Former Treasury Secretary Hank Paulson forced many banking institutions into accepting TARP funds during the financial crisis, threatening the well-run banks with increased regulator action.

Paulson and Federal Reserve Chairman Ben Bernanke sent Bank of America into a tailspin, forcing it to buy Merrill Lynch even though Bank of America wanted out of the deal. According to the Wall Street Journal, Bank of America CEO Ken Lewis

told investigators for New York Attorney General Andrew Cuomo that in December Mr. Paulson threatened him not to cancel a deal to buy Merrill Lynch. BofA had discovered billions of dollars in undisclosed Merrill losses, and Mr. Lewis was considering invoking his rights under a material adverse condition clause to kill the merger. But Washington decided that America's financial system couldn't withstand a Merrill failure, and that BofA had to risk its own solvency to save it.

The Treasury Department went on to approve big pay raises for AIG, Ally Financial and even General Motors, despite all their financial problems.

As the libertarian CATO Institute and others have noted, the federal government created the conditions, laws and regulations that directly led to the financial crisis. The Community Reinvestment Act, assorted regulations, Fannie Mae, Freddie Mac and Congress itself all created incentives and demands for banks to make bad loans to people who could not repay them. These laws, regulations and institutions all made it harder and harder for banks to make money in traditional ways, causing banks to take more and more risks to break even.

There are surely those who should be sued or prosecuted for the financial crisis, but the best anyone could actually do is vote the bulk of the culprits out of office. The rich irony of Elizabeth Warren asking her question to these regulators, whose ranks she would have joined but for a Republican effort to block her nomination prior to her Senate run, is that she is an advocate of increasing the very regulations that contributed to the financial meltdown and that prevent suits against Wall Street banks. After all, Wall Street was just complying with Washington’s orders.

In a final irony, the legislation designed to prevent this all from happening again, commonly called Dodd-Frank, has institutionalized the idea that certain banks are “too big to fail” and put smaller banks at a competitive disadvantage. More and more American assets are held by fewer and fewer banks thanks to ideas advocated by people like Sen. Elizabeth Warren.

If she wants a scalp, she should look in the mirror.

 

 

Erick Erickson is a Fox News contributor and editor of RedState.com. Follow him on



Read more: http://www.foxnews.com/opinion/2013/02/18/if-elizabeth-warren-wants-to-lay-blame-for-financial-mess-can-look-in-mirror/#ixzz2LIR07Sim

 


 

grandma B

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