In New York that’s getting to be a regular pattern in the settlement of charges against financial firms; although Eliot Spitzer, known for creative methods of corporate decapitation, may have departed office, Spitzerism lives on. I explain in a new Cato post on the state’s Ocwen Financial pact.
Related: Tactics the federal government used to seize control of insurer American International Group (AIG) away from Hank Greenberg, now made public despite years spent resisting disclosure [Gretchen Morgenson, New York Times]
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Ocwen. They’ve been feeding off Fannie Mae money for years. Never forget: With government money comes government control. It’s true in education, transportation, finance, healthcare, and housing.
Some research shows that Ocwen has been determinedly unresponsive to regulators and mortgagees for a decade. Behavior that bad starts at the top. If they want to use the govt. as a backstop, they need to make some concessions on a predatory business model.