Attorney General Eric Holder has given U.S. attorneys across the country 90 days to judge whether or not they want to bring cases against specific individuals for their alleged roles in 2008’s mortgage crisis, according to reports.
Speaking at a National Press Club event on Tuesday, Holder said federal prosecutors who have previously brought charges against firms for selling toxic mortgage-backed securities will be given an opportunity to investigate individual employees for potential charges, Reutersreported.
Holder reportedly told the assembled press that prosecutors will have 90 days to report back on “whether they think they are going to successfully bring criminal or civil cases against those individuals.”
The announcement marks a policy shift for Holder, whose department has taken criticism from consumers and politicians with its failure to go after bank executives and some institutions following the crash. In early 2013, he famously remarked at a Senate committee hearing that the size of some institutions makes it difficult to prosecute them without impacting the economy.
He walked those comments back later, saying, “If we find a bank or financial institution that has done something wrong, if we can prove it beyond a reasonable doubt, those cases will be brought.”
The timing of the attorney general’s announcement is also bound to raise questions: With Holder on his way out, the ultimate decision to prosecute would be made by his replacement, who right now is slated to be Loretta Lynch.
“Once again, it appears as though the Administration is looking to bully the mortgage banks, or should I say bankers, instead of restoring faith and confidence into the mortgage banking system,” said Ed Delgado, President and CEO of the Five Star Institute. “Despite hundreds of billions paid in fines and penalties, it’s not enough. Today’s announcement from U.S. Attorney General Eric Holder to seek action against mortgage bankers, just as he is about to leave office, is nothing more than one last attempt to impugn and embarrass an already beleaguered industry.
“Now names and people’s lives have to be destroyed, but to what end? To satisfy what agenda? It begs the question: will a single family benefit from this action? Will a foreclosure be reversed? Or has the matter of seeking justice become politicized to the point, where unless a mortgage executives name and face appear on the cover of the New York Times, charged with some criminal act, there simply will be no measure of satisfaction in the eyes of the government. It’s a shame that taxpayer money is being spent to further a cause without a means to an end.”
A message left with the department’s Office of Public Affairs was not immediately returned.