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The National Credit Union Administration a federal credit union watchdog has filed lawsuits against JPMorgan Chase and the world Bank of Scotland group.
It claims a five credit unions were tricked into purchasing more than three billion of mortgage bonds that went sour.
But isn't really any of the government's business to file lawsuits anytime a deal is gone bad what's next well they file lawsuits on behalf of gamblers -- bad bets on the NBA finals.
Here to discuss -- my freedom fighters Fox Business Network anchor and my colleague Lori Rothman.
Occidental College political science professor Carol and Hellman and -- Rand institute president Iran book.
-- -- you run to you first -- that any of the government's business that some credit unions bought bonds from some banks.
And didn't do due diligence to the extent that the government did after -- -- that the deal once our -- money in the market yesterday is the government gonna sue -- my behalf for no return the money for.
It's ridiculous this is mall of government in a sense Nashville rising a banking system trying to decide who the winners though with the -- -- How the well should be distributed it is -- so it for the government exposed to -- these kind of decisions.
Caroline if the government sues every time a deal goes sour -- to which the government was not was not a party.
Isn't that sort of a safety net underneath these deals that will discourage due diligence.
And of course people say I don't have to worry at this doesn't work out because Uncle Sam will come to my rescue.
-- judge if that was what was happening I would agree with you but I think what's happening here -- is of the banks created toxic assets as soon as they've realized.
They were on the books they -- then very deceptive -- trying to offload them we know this is a pattern of behavior that you know it's I'm glad that the government is going after the more egregious.
Causes of the financial meltdown in 2008 especially considering the financial reform has been so water element.
That is not actually -- I understand your argument that's probably why should the government be doing less of a credit union thinks -- think -- a piece of paper that wasn't worth what it's supposed to be worth.
Should sue them.
Thanks rather than the government in I let Caroline I hope we can have copied -- next time your new York at a time becoming.
The banks the big banks Goldman JPMorgan UBS in this case just the market makers and what the government is doing is.
Outrageous and they're basically looking at these offerings sheets and basically calling it.
Bad advertising we have to pointed fingers at the loan originators and the credit ratings agencies.
Should the government protect us from anything.
Except -- some fraud absolutely not invade this country was found in that principle.
That the government does one thing and it doesn't really well protect individual rights that means protect us each one of us as individuals.
From forcing fought these -- -- -- if who has fought the credit unions would have sued this is the government trying to.
You know decide who the winners and in in really decide to penalize what's been penalized -- -- -- -- you're gonna have a degree tornado mean at least if these at documents that these instruments were so bad why -- and the people lost money -- the lawsuits.
Why does the government have to get involved -- and other than to provide before on the federal court for the lawsuit.
Well I admit it and obviously originated with the people who are affected because how the government even know that there's a case here but it's because it's systemic.
Because it was a systemic problem and I would very much agree with -- that we do have to go after loan originators we have to go after the rating agencies we also have to go after the banks who knew once I realized he's in these assets for talks OK -- -- to get rid of them been very unethical.
