The Attorneys General of the states agreed to a “landmark” deal to “settle” mortgage fraud committed by major banks. In the “settlement,” the banks agree to pay $40Billion.
Financial Times is now reporting that (account required to read the full article), in a little-known and unreported aspect of that deal, up to $35 Billion of the settlement costs will be borne by the taxpayers through the administration’s taxpayer-funded Mortgage modification program known as HAMP:
US taxpayers are expected to subsidise the $40bn settlement owed by five leading banks over allegations that they systematically abused borrowers in pursuit of improper home seizures, the Financial Times has learnt.
However, a clause in the provisional agreement – which has not been made public – allows the banks to count future loan modifications made under a 2009 foreclosure-prevention initiative towards their restructuring obligations for the new settlement, according to people familiar with the matter.
So get back to work, slaves. Your masters need the money.