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When last I looked in on it, I counted $80.35 million in foreclosure fraud settlement funds earmarked for the states actually headed to purposes other than helping homeowners, its ostensible aim. This includes portions from Missouri, Wisconsin, Maine, Maryland and Vermont. Now we can probably add Georgia to the mix.
State legislators and Gov. Nathan Deal will spend $104 million of the $815 million banks are paying Georgia to settle foreclosure fraud claims, but if past indications hold true, much of that money won’t be going to distressed homeowners.
The discretionary cash will likely be spent on other areas of the state budget, as is money from Georgia’s settlement with tobacco companies and millions of dollars in directed fees that Georgians pay yearly [...]
“The state constitution requires that the money go into the state treasury. The governor would prefer that it go from there to the rainy day fund,” said Robinson said.
The rainy day fund is state savings to cover emergencies and hard times. It helps Georgia keep its high bond rating, which saves the state tens of millions of dollars in interest on loans. Legislators used the fund during the recession, shrinking it from $1.5 billion in 2008 to $116 million last year. Under Deal, it has risen back to about $320 million.
The $104 million represents the entire hard payout to the states, to be clear: the $815 million listed at the top includes the consumer relief elements of the settlement, like principal reductions, short sales and refinancings. Georgia Attorney General Sam Olens, through a spokesman, basically shrugged that his hands were tied and Georgia law requires appropriators to deal with a windfall of this type.
It’s true that nothing in the foreclosure fraud settlement documents mandates that funds paid to the states by the banks have to go toward housing measures. So it’s a fair bet that all $104 million to Georgia will get re-routed to a separate purpose.
So let’s look on the tote board. We now have $184.35 million of the settlement going not to housing relief programs, but to fill state budget gaps. That’s out of $2.75 billion headed to the states, or over 6% of the total. And we’ve only confirmed a relative handful of states.
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Governor Deal and Attorney General Sam Olens are useless in this fight and one only has to “follow the money” to discover why.
The Georgia Courts as well seek the line of least resistance at best in this massive rape of the homeowners in Georgia and are usually engaged in making homeowners culpable for an economy engineered by the very people who benefit from foreclosures.
While these documents deal with mostly equitable issues the fraud, false notorizations and filing of manufactured documents on the land records and fraudulent foreclosures should not be “part of the deal.”
As for the monies derived from the “settlement,” (read plea bargain)—these funds should be used for the victims of Wall Street and the massive foreclosure fraud happening every day in Georgia.
I am not surprised by these events however, I am even further vexed by the failure of both Deal and Olens to occupy their offices properly and defend the people that elected them to office….not the Banks who “pad the nests” of both Deal and Olens.
Equity? an extinct species. Rule of Law? Until you can find a loop hole or cut a “deal…” pun intended.
And what percentage of these states recently cut corporate/rich peoples’ taxes? Most I’ll bet.
In light of the recent revelations that:
1) Wars need not be declared;
2) Americans are fair game for assassination; and
3) Indefinite detention is fun for all.
I now have to laugh that some of us used to be concerned about waterboarding and warrantless wiretapping.
Taking all of this into account, I wanted to edit your story:
They can do whatever they want. The rule of law only applies to the little people.
And on a slightly less s/ note… I again ask everyone to start FOIing their state AGs for all settlement-related docs. As David is making crystal clear, the legislatures are going to take this money. And while I doubt the ability of us villagers with torches and pitchforks to change the actions of the PTB, we may be able to at least embarrass them and give some oppo research to whomever their 2012 / 2014 opponents will be. That’s obviously the only way any of the PTB will normally ever care about justice and accountability.
Hell of a read Mr. Dayen, had to post it to FB.
First the rich bankers n Wall Streeters go unpunished criminally, then the settlements are watered down, now the settlements are taken OUT of the hands of those they were intended to help.
Fleecing of the greatest quality, better n any 3 card monty folded up table game on a New York backstreet corner.
LeSigh. Great read, thanks for your work.
I can hardly read any more of this stuff. It is insane, first, last and completely. Once you look at any of what is going on you realize that every day it is some new atrocity and then the Obama apologists say: well, gee, you’re a downer. You don’t ever congratulate Obama when he does something good. I want to yell, he is not a four year old boy and we are not his parents: Oh Good Job Barry! But even so, for every reasonable thing he has done, there has been a pile of other more serious things he has done which will impact us grievously. As for the attorney generals who let this debacle take place, you are an embarrassment to me as a lawyer. I will do my best to continue the fight but I know who is on our side and who is not.
This is Obama’s justice department, run by and for Goldman Sachs.
It’s time to “go Galt” on the parasitic Red States. Cut off all federal funding. Why should the Blue States support these knuckle dragging parasites?
Another great find, Mr. Dayen. Keep it up!
Here in Woody Guthrie Land, the Repugs are going to use the money to make up a budget deficit and funnel the money to business and the wealthy in the form of tax cuts to those groups.