David Dayen
1. Hey remember when DoJ blustered that Deutsche Bank was going to pay 14 BILLION DOLLARS for mortgage bond abuses & everyone freaked out?
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Don't get fooled by the headline $7.2 billion number. $4.1 billion is in "credits" for loan modifications. DEUTSCHE DOESN'T OWN THE LOANS.
6. It's great that someone who needs it might get a loan mod but Deutsche is paying over half this penalty with someone else's money.
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7. Some (incl me) were concerned that Deutsche had no reason to comply with a settlement since their borrower Trump would soon be in the WH
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8. But before you think this deal sucks b/c DoJ lost their leverage, understand this is the same crappy settlement they've done w/every bank
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9. The worst part is that DoJ has changed norms (not just Trump) by turning these dumb settlements into a substitute for accountability.
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10. You sprinkle a small fine w/"help for homeowners" (which doesn't reach them to the degree promised), hold a press conference & smile
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11. BTW this was a case where investors were lied to about quality of mortgages in bonds. Do they see any restitution here? No.
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12. I'm rather old-fashioned, I think the penalty for a crime should benefit its victims.
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13. The Obama DoJ has transformed a law enforcement agency into a debt collector. It's a sad legacy.
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