The origin of the banking mess can be found in the Community
Reinvestment Act. The bill was meant to encourage banks to make loans to
minorities living in unstable neighborhoods. Based on that bill and
subsequent amendments, ACORN was able to intimidate banks into lower
mortgage standards paved the way for the meltdown.
The financial bubble has many “fathers,” President Obama is
just one of them. It is astounding that he can to blame it all on
Americans who did not read contracts and untruthful lenders, because if
the POTUS is going to throw around blame, he should
start by accepting some of it himself.
As the Daily Beast describes:
President Barack Obama was a pioneering contributor to the national subprime real estate bubble, and roughly half of the 186 African-American clients in his landmark 1995 mortgage discrimination lawsuit against Citibank have since gone bankrupt or received foreclosure notices.
They published an in-depth story story of Obama’s suit against Citibank which had a big role in blowing up the housing bubble:
When Obama became a leader in Chicago’s Woods Fund, he became the most
powerful voice on the foundation’s board for supporting ACORN and other
community organizers. In 1995, the Woods Fund substantially expanded its
funding of community organizers – and Obama chaired the committee that
urged and managed the shift
Barack Obama acted as one of ACORN’s Lawyers, he also trained people
to “community organize” which in ACORN’s case means teaching people to
push banks into making ill-advised loans.
“Obama, who once represented ACORN in a lawsuit against
the state of Illinois, was hired by the group to train its community
organizers and staff in the methods and tactics of the late Saul
Alinsky. ACORN would stage in-your-face protests in bank lobbies,
drive-through lanes and even at bank managers’ homes to get them to
issue risky loans in the inner city or face charges of racism.
In the early 1990s, reports Stanley Kurtz, senior fellow at the Ethics
and Policy Center, Obama was personally recruited by Chicago’s ACORN to
run training sessions in “direct action.” That’s the euphemism for the
techniques used under the cover of the federal Community Reinvestment
Act to intimidate financial institutions into giving what have been
called “Ninja” loans — no income, no job, no assets — to people who
couldn’t afford them.”
ACORN began to file lawsuits making a bogus claims of
Redlining (denying poor people loans because of their ethnic heritage).
They would protest and get the local media to cover their protest. In
Illinois, those protesters were trained by the future president. The bad
publicity-shy banks would face thousands of people closing their
accounts and get local politicians to lobby to stop the bank from doing
some future business, expansions and mergers. If the bank decided to go
to court, they would win, but the damage would be already done:
“It is important to understand the nature of these
lawsuits and what their purpose is. ACORN filed, or threatened to file,
tons of these lawsuits and ALL CRA suits allege racism (usually the
press involved and such with the threat of the CRA lawsuit is enough to
get the bank to give in and put them in a catch 22, the series of ACORN
harassment lawsuits and intimidation against banks to lower credit
standards was not the sole reason for the mortgage crisis, it was one
important layer of many that brought us to the mortgage crisis and the
largest financial scandal in the history of the world.”
And the future President was helping ACORN with this economic blackmail. He even acted as their lawyer in a suit against against Citibank:
Buycks-Roberson v. Citibank Fed. Sav. Bank Fair Housing/Lending/Insurance
Docket / Court 94 C 4094 ( N.D. Ill. ) FH-IL-0011
Plaintiffs filed their class action lawsuit on July 6, 1994, alleging
that Citibank had engaged in redlining practices in the Chicago
metropolitan area in violation of the Equal Credit Opportunity Act
(ECOA), 15 U.S.C. 1691; the Fair Housing Act, 42 U.S.C. 3601-3619; the
Thirteenth Amendment to the U.S. Constitution; and 42 U.S.C. 1981, 1982.
Plaintiffs alleged that the Defendant-bank rejected loan applications
of minority applicants while approving loan applications filed by white
applicants with similar financial characteristics and credit histories.
Plaintiffs sought injunctive relief, actual damages, and punitive
U.S. District Court Judge Ruben Castillo certified the Plaintiffs’ suit
as a class action on June 30, 1995. Buycks-Roberson v. Citibank Fed.
Sav. Bank, 162 F.R.D. 322 (N.D. Ill. 1995). Also on June 30, Judge
Castillo granted Plaintiffs’ motion to compel discovery of a sample of
Defendant-bank’s loan application files. Buycks-Roberson v. Citibank
Fed. Sav. Bank, 162 F.R.D. 338 (N.D. Ill. 1995).
The parties voluntarily dismissed the case on May 12, 1998, pursuant to a settlement agreement.
Plaintiff’s Lawyers Alexis, Hilary I. (Illinois)
FH-IL-0011-7500 | FH-IL-0011-7501 | FH-IL-0011-9000
…..Miner, Judson Hirsch (Illinois)
FH-IL-0011-7500 | FH-IL-0011-9000
Obama, Barack H. (Illinois)
FH-IL-0011-7500 | FH-IL-0011-7501 | FH-IL-0011-9000
Wickert, John Henry (Illinois)
This is just a taste, the Daily Beast has the full story, documentation and implications–it’s a must read.