At the heart of the controversy over the RMBS working group, the task force inside the Justice Department’s Financial Fraud unit looking into securitization abuses by big banks during the housing bubble, is co-chair Eric Schneiderman, the Attorney General of New York. His office has been silent about the task force, even as progressive groups questioned the commitment to resources for it and the number of investigators alloted in the first place. Since a few subpoenas were filed at the outset of the working group in February, the NY AG’s office has made no public and few private statements. The Justice Department says that Schneiderman and his other four co-chairs talk daily and meet weekly.
The working group was essentially Schneiderman’s idea, driven by his strategy to build a “second table,” apart from the foreclosure fraud abuses, to get a second bite at real relief for homeowners and accountability for those who committed crimes and created the conditions for the Great Recession. So his silence has resonated.
Now Matt Stoller has uncovered the by-product of that silence. By keeping everyone in the dark, and making no headway on prosecutions of the financial industry in his first year in office, Schneiderman has become either an afterthought or a disliked figure among his own constituents. Stoller finds a Siena poll from March:
Both Comptroller Tom DiNapoli and Attorney General Eric Schneiderman remain a mystery to more than half the voters. DiNapoli has 25-23 percent favorability rating with 52 percent having no opinion, and Schneiderman has a 21-23 percent favorability rating with 55 percent having no opinion,” Greenberg said. “However, when asked how Schneiderman and DiNapoli are doing in their jobs, voters are far more negative. Schneiderman has a negative 30-43 percent job performance rating, and DiNapoli’s has a negative 26-45 percent rating.”
It’s pretty difficult to be unknown in the extremely powerful position of New York Attorney General. Both Eliot Spitzer and Andrew Cuomo parlayed the position into national profiles and gubernatorial victories in New York. Schneiderman’s impact is best exemplified by an anecdote Stoller tells, where an active, liberal couple from upstate New York only knows Schneiderman from harassing letters he sent to their non-profit.
Schneiderman’s main effort in office has been the mortgage settlement negotiation. While he’s done some reasonable things on that front, such as his intervention in the Bank of America/Bank of New York settlement, by and large his position at the State of the Union and the financial fraud task force has not panned out. The tip-off that the financial fraud task force wasn’t going well was that the extremely knowledgeable Congressman Brad Miller was passed over for the coordinating job. Now it turns out that the task force, after three months, has accomplished the grand feat of posting that job public [...]
Schneiderman has been in office for more than a year. There have been no handcuffs or indictments on anyone involved in the financial crisis or the foreclosure crisis. An attorney general that doesn’t indict or prosecute isn’t worth paying attention to – and so voters aren’t. Of course, this is just his first year. He can turn it around. Bill Clinton, after a disastrous initial Presidency, fired a lot of his staff in the White House and brought in a more seasoned, professional team that righted the ship.
Stoller intimates that the problem lies with Schneiderman’s perspective as a legislator and not a law enforcement official, and that there are barriers within his office and his staff which he has not yet surmounted. There are also power issues between Schneiderman and the popular governor Cuomo, who gutted the AG’s office when he left, and tried to build a separate law enforcement entity within the executive branch to compete with the AG at the state level.
But overall, you see a “Sheriff of Wall Street” who simply doesn’t resonate with New Yorkers. He has ambled along with the same kind of settlement deals and “neither admit or deny wrongdoing” statements and unfulfilled promises that have been characteristic of justice in the age of no accountability. It’s a shame, but there’s still time for Schneiderman to turn it around.