Rating agency may pay $1 billion to settle mortgage-related fraud claims
Although the banksters and their accomplices have emerged from the Great Recession largely unscathed, many people across the country still struggle now. For those among the proverbial 99%, the news of a potential settlement between the Department of Justice and Standard & Poor’s may be bittersweet. On the one hand, $1 billion is a substantial amount of money for any company to pay; on the other hand, considering the extreme hardship caused by the Great Recession for millions of people, $1 billion seems to be a small penalty for the rating agency authorities accuse of fraudulently inflating the value of mortgage investments before the financial meltdown. In fact, $1 billion reportedly represents only 1 year of operating profits for Standard & Poor’s.
In this context, it is difficult to conclude that enforcement authorities have taken adequate action to advance fully the interests of consumer protection, specifically, and the rule of law, generally. We should therefore expect class action litigation to expand as people seek justice themselves through the court system. In addition, Occupy Wall Street and other grassroots organizations continue to pursue accountability in the court of public opinion and by other means. Those organizations also appear poised to work more directly with #BlackLivesMatter and other civil rights groups to push for broad-based and progressive change in the nation’s policies. Such changes, as championed by Senator Elizabeth Warren and others in Congress, would make another financial collapse highly unlikely because the rule of law would be respected and robustly enforced.