A Local Government Plays Catch a Catch Can

The Con is a thoughtful 5-piece docuseries that features borrowers who were hornswoggled into mortgages that blew up during the economic crisis of 2008. These unsuspecting homeowners in Ohio travailed the foreclosure process into broken marriages, financial ruin, and suicide. These filmmakers sift through the layers of chicanery only to discover it was the federal government that orchestrated The Great Recession. “Tragedy” is too weak a word for the destruction many people endured while the bankers, bundlers and swappers who played “slight of hand” with their mortgages became billionaires and walked away unscathed. Another ace in the 3-card Monty, more smoke in the house of mirrors that were not exposed in The Con but was also in full manifest in Ohio, was the criminal prosecutions of local realtors in the aftermath.

Ostensibly to protect their citizens, the State of Ohio received a chunky federal grant payment to prosecute banks for predatory lending practices that The Con correctly identifies as the propagation mechanism for creating fraudulent mortgages. However, the Cuyahoga County Mortgage Fraud Task Force formed in Cleveland, indicted thousands of local realtors for using the subprime loan programs they were paid to investigate.  Charging state theft statutes that require a victim, the prosecutors quickly claimed that the banks were the victims and ordered millions in restitution that was diverted to the county probation department where it seems to have evaporated because the banks didn’t get it.

At the same time, to add insult to injury, this same gang of political bandits formed the Cuyahoga County Land Bank to cash in on the massive amounts of foreclosures. By upending the service at the County Clerk’s office and denying Judges access to court docket to complete the foreclosure to transfer the title, this “blight by design” resulted in parlaying years of delinquent tax sale certificates into cash and cash equivalent assets for this land bank.  

These silk stocking crooks are about as corrupt as it gets in local government but, hey, Cuyahoga County nailed this mortgage thing! The fraud came full circle – during the boom by collecting inflated tax revenues on inflated property values, during the bust by pocketing restitution for fabricated victims, and during the aftermath by seizing the properties themselves.

While The Con does a fine job fleshing out the multi-stratum scam from the mortgage makers to the mortgage bundlers to the bundle buyers to the Wall Street bundle swappers, they neglected the tier of exploitation by local governments hell-bent on enriching itself by catch a catch can. Watch for the new riveting and revealing TV drama called Liar Loans (LiarLoansSeries.com) to learn more about what really goes on behind the scenes in the mortgage business.

 
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