White Collar Crime – Ninja Loans
When I look back over the last three years I am surprised it has taken this long for average, everyday, Americans to become fed up and start marching in the streets. Not often, but occasionally I get engaged in a discussion of the 2007 financial problems and the crash of 2008. Many of my friends think I am some kind of a financial genius. They are wrong.
An idiot should have been able to see what was going to happen with the US housing market. In fact, I did see what was coming, albeit just a few weeks ahead of the 2008 crash. It is also surprising that so many people have never heard of a NINJA loan.
In actual fact in the early days of NINJA loans, by the banking and investment definition, lenders were still supposed to verify key parts of potential lenders information. For example; verification was to be required or requested for annual income and employment. The crime is that they didn’t. Perhaps at first some of them did but the acronym NINJA has no V, for verification in it. That simple fact might have been the straw that broke the camels back.
So by spring of 2008 banks were being flooded with applications from people, most of who had more than questionable ability to pay on a loan. Shocking – you have no idea how shocking. The term NINJA meant, out in the trenches at the local Wells Fargo and Bank of America Banks, a loan the loan officer, who was paid partially by the number of Ninja loans he wrote, did not have to verify. That’s correct, no income verification, no job verification, no asset verification. Take out the word verification, why not – you did not have to do that – and you get NINJA.
I know for a fact that one Wells Fargo office on the West Coast hired Spanish speaking loan officers just to handle the numbers of non – US citizens coming in for NINJA loans. By the way, another thing they never verified was if the applicant, or should I say grantee, even had a US Social Security Number.
The crime committed by the deregulated banking industry got so big, well we have all heard the phrase. They were too big to allow to fail. Another crime lost in the rush to bail out the very people who caused these problems was the failure to help those at the bottom end of the food chain. It was the absolute neglect of Joe the plumber and common citizen. The guy who thought he was middle class or at least heading in that direction. Instead our government, both Republican and Democratic, bailed out the APEX predators at the top of the financial food chain.
So to my mind, it’s no wonder the people are taking to the streets, to occupy this and occupy that. We best hope Ninja’s don’t return because if they do, this time it won’t be to lend money. Rather It might just be the 99% have had enough and turn the lot of them out on their ears.