A Slap on the Wrist for Wells Fargo
Joe Nocera asks why brokers working for the banks who lied on mortgage documents are treated less harshly than individual mortgagees who lied on their application for a loan.
In March, for instance, I wrote about the sad case of Charlie Engle, the ultra-marathoner, who was convicted of lying on a liar loan — that is, exaggerating his income on a subprime mortgage application — even though the evidence against him was thin. Prosecuted by Neil H. MacBride, the U.S. attorney for the Eastern District of Virginia, Engle was sentenced to 21 months in prison.
Now compare Engle’s alleged crime to the case the Federal Reserve brought against Wells Fargo Financial, which, until it was shut down last summer, was the subprime subsidiary of Wells Fargo, based in Des Moines. There were several allegations, but the one that caught my eye was that Wells employees “falsified income information on mortgage applications.” In other words, they lied on liar loans! The only difference is that the lying was done by a group of Wells Fargo brokers rather than by some poor sap like Charlie Engle.
This is precisely the type of injustice that makes Americans lose faith in our country.