Respectfully submitted by Lawrence Rafferty (rafflaw)-Guest Blogger
Just the other day we learned of the proposed foreclosure abuse settlement between the Attorney Generals of almost all 50 states and the Big Banks. In that pending settlement, the Banks will be depositing up to $26 Billion dollars into a fund designed to help homeowners whose homes are under water and who have been foreclosed upon. “Federal and state officials today will finally announce that they’ve reached a settlement with the nation’s biggest banks over the banks’ various foreclosure fraud abuses, such as “robo-signing” foreclosure documents and submitting falsely notarized documents to courts. The settlement has been in the works for several months, as a few key states — most notably California and New York — were holding out for tougher terms against the banks.” Think Progress While some still think the settlement does not go far enough, there is evidence that the settlement could provide real relief for homeowners and for the real estate market. But the concept of helping the market and homeowners gets lost, at least in the mind of Gov. Scott Walker of Wisconsin!
Gov. Walker and his Wisconsin Attorney General have decided that the lions share of any settlement funds heading to Wisconsin are not going to be used for their agreed upon purpose, but to help balance his ailing state budget! “However, Wisconsin Gov. Scott Walker (R) — whose high profile assault on workers’ rights has prompted a recall effort against him — isn’t planning to use the money to help homeowners. Under the terms of the settlement, Wisconsin is set to receive $140 million, $31.6 million of which comes directly to the state government. And Walker is planning to use $25.6 million of that money to help balance his state’s budget: Of a $31.6 million payment coming directly to the state government, most of that money – $25.6 million – will go to help close a budget shortfall revealed in newly released state projections. [Wisconsin Attorney General J.B. Van Hollen], whose office said he has the legal authority over the money, made the decision in consultation with Walker. “Just like communities and individuals have been affected, the foreclosure crisis has had an effect on the state of Wisconsin, in terms of unemployment. … This will offset that damage done to the state of Wisconsin,” Walker said.” Think Progress
Somehow, Gov. Walker and his AG are trying to make us believe that funds that have been tentatively agreed upon to be used to help individual homeowners and former homeowners, will be better utilized to balance his budget that has been criticized for making gifts to corporations at the expense of the individual citizens and public education. Journal Sentinel Did Gov. Walker think that the big blow-up over contraception the last few days would hide this story of outright theft from the homeowners who need it the most?
Notwithstanding your opinion of the proposed settlement, what good at all will this proposed settlement be to homeowners and the real estate market if individual Governors are allowed to raid the funds and use them in ways that they were not intended to be used? Is this just one more example of politicians attempting to line their pockets or to service their “base” and leaving the taxpayers in their dust? Will this attempted theft by Walker be one more nail in his political coffin with his pending recall election later this year?
In this writers opinion, the Feds and the majority of Attorney Generals from across the country need to make sure that when the agreement is finalized that individual Governors cannot be allowed to defraud the public and steal the funds delegated for homeowner relief. How do the state Attorneys General prevent this kind of deception what weakening the impact of this settlement? What do you think?