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Investigating Blabbermouth Schumer

By Michelle Malkin  •  August 21, 2008 11:21 AM

Jerry Brown is the California AG, so expectations should be managed. Still, the prospect of blabbermouth Chuckie being held to account for his reckless indiscretion is worth savoring, even for a fleeting moment:

California’s attorney general is reviewing a request by former employees of IndyMac Bancorp Inc to investigate whether a New York senator triggered the bank’s collapse by releasing confidential information.

At issue is a much-publicized letter that Chuck Schumer, a Democrat, sent in June to the Federal Deposit Insurance Corp (FDIC) and Office of Thrift Supervision (OTS) questioning the company’s ability to survive.

The FDIC took control of IndyMac on July 11 after depositors withdrew more than $1.3 billion over 11 days. It was the third-largest bank failure in U.S. history. At the time, OTS Director John Reich blamed Schumer’s letter for causing the run on the bank.

In a letter to Attorney General Jerry Brown last week, 51 former IndyMac workers wrote: “From the day (Schumer’s) letter was made public on June 26 until the closure of the bank, a run on the bank took place and the failure became inevitable.”

Brown’s spokeswoman Christine Gasparac said on Wednesday that his office was reviewing the letter and that a decision on whether to act on it could be made as early as next week.

IndyMac is based in Pasadena, California.

After IndyMac’s collapse, Schumer accused the OTS of allowing IndyMac’s lending practices to slip. IndyMac specialized in a type of mortgage that often required minimal documents from borrowers.

Background blogging on Schumer/Indymac here. In related IndyMac news, this will get the blood of responsible borrowers and homeowners boiling:

Federal regulators yesterday announced a plan to systematically modify the loans of at least 25,000 homeowners with mortgages held by failed lender IndyMac in an attempt to create an industry model for assisting troubled borrowers.

Throwing a lifeline to distressed homeowners, the Federal Deposit Insurance Corp. will offer delinquent IndyMac borrowers new mortgages with interest rates as low as 3 percent. It is partly a challenge of speed: The FDIC wants to complete the modifications by mid-October, three months after it took control of the troubled California bank. It aims to sell off IndyMac’s assets by then.

“I have long supported a systematic and streamlined approach to loan modifications to put borrowers into long-term, sustainable mortgages — achieving an improved return for bankers and investors compared to foreclosure,” FDIC Chairman Sheila C. Bair said in a statement.

FDIC officials said they hoped the program would become a model for the industry and prompt other mortgage lenders to do more to work with troubled borrowers, but they did not indicate whether they would adopt this program in future bank failures. Freddie Mac has also launched a pilot program allowing for mass modifications of loans.

“I think a lot of the [mortgage lenders] will frankly welcome the initiative,” Bair said in a conference call with reporters.

In other words, thanks to the government takeover precipitated by Schumer’s big mouth, those who were paying their loans on time get screwed — and those who were on the brink of foreclosure get rewarded.

Message: Stop being so damned conscientious and start defaulting now!

Posted in: Subprime crisis

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  1. #1
    On August 21st, 2008 at 11:26 am, Straight_Talk_Luigi said:

    In other words, thanks to the government takeover precipitated by Schumer’s big mouth, those who were paying their loans on time get screwed — and those who were on the brink of foreclosure get rewarded.

    I guess so. I’m not sure why the AP just can’t make it that simple.

    Personal irresponsibility (with the exception of the environment) is rampant with secular progressives.

    Interesting way of “progress” too, huh?

  2. #2
    On August 21st, 2008 at 11:31 am, bloghooligan said:

    3%? I want in. How do I get this sweetheart deal? Should I not pay my mortgage for the next few months, or what?

  3. #3
    On August 21st, 2008 at 11:32 am, CantCureStupid said:

    Schumer should be impeached and removed. What a freakin joke. As far as this idiotic mortgage bailout… well, whatever. I pay my bills and I’m going to keep doing so because I’d rather die broke and with dignity than a useless loser on the government teat.

  4. #4
    On August 21st, 2008 at 11:32 am, swmbo said:

    Help me - Help me - I’m tired of being good. Someone needs to write a book on how to live on the dole and still look oneself in the mirror.

    My parents failed me. They taught me about personal responsibility and consequences. I was even spanked as a child. I need Help NOW. sarc/off

  5. #5
    On August 21st, 2008 at 11:34 am, jsmiddleton4 said:

    Stop being so damned conscientious and start defaulting now!

    It does at least cause one to stop and ponder just who is making the smart choices. Are those of us who are responsible and feel like we should work to pay back debt we willing assumed the stupid ones here?

  6. #6
    On August 21st, 2008 at 11:35 am, SuzEQCitizen said:

    I’m waiting for the response from the Right about the Dems latest whine-fest re: McCain not knowing how many properties he owns.

    And the big deal with that is….?

    Oh wait, he must not be in default.

  7. #7
    On August 21st, 2008 at 11:36 am, b-cat said:

    At first glance, I thought the headline read, “INVESTIGATING BLABBERMOUTH SCUM”. Then I read more closely and it did.

  8. #8
    On August 21st, 2008 at 11:38 am, sonofdy said:

    Got it. Big screen tv and a 3% mortgage, here I come!!!

  9. #9
    On August 21st, 2008 at 11:39 am, mojack420 said:

    IndyMac specialized in a type of mortgage that often required minimal documents from borrowers

    how many illegal alien home owners are we the American citizens now rewarding ????

    if you dont understand what an adjustable rate is you are too stupid to own a home .

  10. #10
    On August 21st, 2008 at 11:39 am, sonofdy said:

    BTW the dems are attacking McCain for having more than one house. They are trying to paint him as a rich guy. Duh.

  11. #11
    On August 21st, 2008 at 11:39 am, secondsight said:

    The Republicans Made Me Do It: Reuters

    “Copies of the employee letter were distributed to the press by CRC Public Relations whose clients include the National Republican Congressional Committee, National Republican Senatorial Committee and the Republican National Committee.

    CRC, based in Alexandria, Virginia, was also linked to a company that published a book questioning 2004 Democratic presidential candidate John Kerry’s Vietnam service on a swift boat.

    Schumer spokesman Brian Fallon questioned the motivation behind the letter.

    “It certainly raises eyebrows that the firm promoting this letter is the same outfit that fueled the Swift Boat attacks and does work for the RNC,” Fallon said.”

  12. #12
    On August 21st, 2008 at 11:40 am, shooter said:

    I want 3%.

    So if I don’t pay for a few months, they’ll forgive what I missed AND re-write the paper at three (3%) percent?

    WOW, I could take a killer vacation.

  13. #13
    On August 21st, 2008 at 11:40 am, letget said:

    The damage has already been done by Schumer. I doubt one single thing will done to him for his actions.
    L

  14. #14
    On August 21st, 2008 at 11:40 am, davidleerothmann said:

    Boy, I finally give up. Will one of the resident liberals here please offer me some counseling? I was laid off recently, and I have a mortgage. I’m a hard luck story!!!

    Instead of acting like a victim (which I am!) I hit the ground, found a job as a waiter at night and a job at a retail store during the day. Between the two jobs, I manage to pay my bills on time and pay my COBRA so that I don’t become a burden to the government. All the while I am still paying my taxes so that the people who are lazier-er- more victimized than I am can get their free education, housing, food, and medical treatment.

    Help me liberals! I want to be like you! Help to abandon my painful adulthood filled with responsible behavior, and begin acting as you advocate. Can you tell me where to get some weed, to start off with? I figure using drugs is the first step on the pathway to government dependence, and the mindset required to lose my pride and self esteem.

  15. #15
    On August 21st, 2008 at 11:40 am, twiggman said:

    This crap makes me sick…

  16. #16
    On August 21st, 2008 at 11:45 am, Mister P said:

    Isn’t Schummer one of the White Male leaders of the Democratic party? His day is coming.

  17. #17
    On August 21st, 2008 at 11:45 am, John Ansell said:
  18. #18
    On August 21st, 2008 at 11:45 am, Anita said:

    On August 21st, 2008 at 11:39 am, sonofdy said:
    BTW the dems are attacking McCain for having more than one house. They are trying to paint him as a rich guy. Duh.

    John Edwards house is worth what? How many millions “the one” raises for his campaign from Soros?

    If only the MSM chose to “report” a dem.scandal!

  19. #19
    On August 21st, 2008 at 11:54 am, Shilo said:

    Don’t pay your morgage and the Great One will bail you out….. I wonder what would happen if I can’t afford my property taxes this year?

  20. #20
    On August 21st, 2008 at 11:55 am, sonofdy said:

    I know, its huffpo But on this link they say

    The answer, according to the group Progressive Accountability, is an even 10 homes, ranches, condos, and lofts, together worth a combined estimated $13,823,269.

    So the ad is wrong. You would think they would actualy check thier facts before producing an ad.

  21. #21
    On August 21st, 2008 at 11:59 am, b-cat said:

    On August 21st, 2008 at 11:55 am, sonofdy said:
    So the ad is wrong. You would think they would actualy check thier facts before producing an ad.

    You would think, but that would take work, which is more than the average lib-activist-operative is willing to do.

  22. #22
    On August 21st, 2008 at 12:00 pm, judybeth said:

    Jerry Brown investigating Chuck Schumer? Don’t hold your breath for substantial information/comdenation/recommendation to be publicized soon! (Unless you are tired of living!) Swimbo and millions of citizens were raised by the same parental matra: “You broke it! You fix it. You spilled it! You clean it up! You made a bad decision! Live with the consequences! Don’t expect us to bail you out if you get into debt! You are on your own, so you are responsible! Get another job! THINK before you ACT!” Those of us who have been raised to be responsible for ourselves and our families are now responsible for more and more dead beats! Econ.101-No more than 25% of your income should be spent on a mortgage, taxes, and homeowners insurance! Another “old folks” sage advice: “If you can’t afford it, don’t buy it!” jb

  23. #23
    On August 21st, 2008 at 12:01 pm, jtex said:

    You need help. You’d never make it as a liberal, being responsible and all you know. The liberal way is to blame everyone else.

    On August 21st, 2008 at 11:40 am, davidleerothmann said

    :

  24. #24
    On August 21st, 2008 at 12:01 pm, Karmi said:

    “At the end of the day, it’s of keen interest to me to see whether or not we can get Chuck Schumer frog-marched out of Senate in handcuffs.”

  25. #25
    On August 21st, 2008 at 12:01 pm, BlameAmericaLast said:

    Not holding my breath on this one.

    Now, if it was a Republican senator, he’d be forced to resign immediately and sent to jail, in addition to the 15 front page, above the fold stories in the NYT, Washington Post, etc.

  26. #26
    On August 21st, 2008 at 12:08 pm, jdubya said:

    I just so happen to have a mortgage through IndyMAC. Back in May, my home equity was cut previously due to a claim that my “home value had dropped”, which is a load of stinking dog loaves. They returned my home equity line of credit after one of their geniuses told me that the bank was having problems and might go under (which I reminded him that the call was recorded).

    The second time I received the same BS letter from IndayMAC was on the Thursday before they went belly up. What he did is worse of yelling “FIRE” in a crowded theater. I know two high up bankers of small banks who feared that this might have created a Domino Effect.

    Charles Schumer is a scum-bag POS, who abused his title and shirked his responsibilities issuing a letter that caused this $1.3B nightmare to the bank.

    Of course this bloated puss-bag will act as if his soiled linens smell like roses.

    He is a corrupt dinosaur and will not be missed.

    I highly doubt Jerry Brown will lift a finger on this matter.

  27. #27
    On August 21st, 2008 at 12:19 pm, meatpieandtatters said:

    Schumer is a liberal flame-thrower and has thus far escaped any repercussions for his big mouth. I’d love to see him take a direct hit as the ethically-challenged, self-serving schmoe he really is.

  28. #28
    On August 21st, 2008 at 12:22 pm, On-my-soap-box said:

    If I have two loans do I get a 1.5% rate for each?

  29. #29
    On August 21st, 2008 at 12:23 pm, ajmontana said:

    twiggman said:
    This crap makes me sick…

    me too.
    Vote them all out now.

  30. #30
    On August 21st, 2008 at 12:34 pm, ajmontana said:

    On-my-soap-box said:
    If I have two loans do I get a 1.5% rate for each?

    Maybe, if you dress up like Juan Valdez and ask really really nice.
    Don’t forget to ask free food for your Donkey. 8)

  31. #31
    On August 21st, 2008 at 12:36 pm, franksalterego said:

    “Hello…I’m from the gov’t…I’m here to help.”

    Clinton Plan Would Soften Banking Rules
    NYTimes, March 10, 1993

    Follow…The…Bouncing…Ball

  32. #32
    On August 21st, 2008 at 12:36 pm, Rogue Cheddar said:

    Hey everybody! I’m having a mortgage burning party, even though I still got 20 years to go, and you all are invited! BYOB.

  33. #33
    On August 21st, 2008 at 12:37 pm, txvet2 said:

    If this gets approved, I’m suing GMAC for an equivalent interest rate.

  34. #34
    On August 21st, 2008 at 12:46 pm, Simon86 said:

    I am about to turn 40 and still rent because I can’t afford a house at this time. After reading this, what the heck, I’m going house hunting this weekend. I can get a huge house and after a year I can default on the loan and everyone will come to my rescue. So long apartment living, hello good life.

  35. #35
    On August 21st, 2008 at 12:55 pm, T-Bone said:

    He killed those banks in cold blood because he was overextended. He can’t handle the stress & pressure.

    John Murtha

  36. #36
    On August 21st, 2008 at 1:08 pm, normsrevenge said:

    What is it with Dems and letters?

    Harry Reid.. Chuck Schumer..

  37. #37
    On August 21st, 2008 at 1:09 pm, FireBlogger said:

    My mortgage is held by IndyMac and I have never missed a payment or have I ever been late. Where’s my reward?

    If I can get my loan adjusted down to 3% by missing a couple of payments then count me in.

    Where do I apply?

  38. #38
    On August 21st, 2008 at 1:16 pm, tre said:

    #33 Simon86

    I’m 42, and we rent. We sold our house and acreage because it was eating up too much of our income, and we need to get therapy for our autistic son.

    If only we had waited for Big Brother to come bail us out.

    But, dog gone it! My parents raised me to have a sense of pride and dignity!

  39. #39
    On August 21st, 2008 at 1:16 pm, TimothyJ said:

    This isn’t about average joe citizen, it’s so that that defaulting broad congresswoman can get money for those three homes she defaulted on. Democrats protect their own no matter what.

  40. #40
    On August 21st, 2008 at 1:33 pm, Simon86 said:

    #37 tre

    I was also taught well by my partents and I’m glad to see I’m not the only responsible person who knows the limits of their financial situation. I will say, one good thing about living in an apartment…I don’t have to cut the grass.

  41. #41
    On August 21st, 2008 at 1:40 pm, Flyoverman said:

    Chuck Shumer… the financial markets’ equivalent of Joe Biden.

  42. #42
    On August 21st, 2008 at 1:41 pm, ahraley said:

    I asked for this weeks ago!!!

    GO GET HIM!!!

  43. #43
    On August 21st, 2008 at 1:57 pm, Joy said:

    He’s a Dem, nothing will happen. It will be blamed on Bush and the e-vil genius Karl Rove… :roll:

  44. #44
    On August 21st, 2008 at 2:00 pm, madchef said:

    Sic Semper Tyrannis!!

  45. #45
    On August 21st, 2008 at 2:01 pm, Joy said:

    PS - This is positively disgusting and I hope no one who is of sound conscience allows this temptation to derail them.

    Nothing like a governement who actually tempts people to do wrong. Sheeesh.

  46. #46
    On August 21st, 2008 at 2:07 pm, b-cat said:

    Rewards them for it, too, Joy.

  47. #47
    On August 21st, 2008 at 2:26 pm, martin.musculus(jr.) said:

    I think people here are missing the point. Especially those who ascribe these Liberal actions to random stupidity. In a randomly stupid situation there would be acts both above (patriotic, culture-building, pro-prosperity, government repairing… however you want to define a positive graph point) AND below (unpariotic, deconstructing the culture, depressive, etc. a negative graph point) the mean.

    That isn’t what’s occuring. We get a steady stream of negative prosperity destroying graph points.

    Cluckie Shroomer isn’t without craftiness. Do you really think its w/o purpose? I do not.

  48. #48
    On August 21st, 2008 at 2:29 pm, John Deaux said:

    On August 21st, 2008 at 11:32 am, CantCureStupid said:
    …useless loser on the government teat.

    They ought to get together for a convention. Oh, wait.

  49. #49
    On August 21st, 2008 at 2:30 pm, gandolphxx said:

    If they investigate [unlikely] that will just get him more TV exposure whcich was the point of the entire adventure, what would he know about banking or the real world, he is a piece of ‘Schumer’.

  50. #50
    On August 21st, 2008 at 4:06 pm, FamilyMan said:

    Thanks Schumer for adding to the national debt.

  51. #51
    On August 21st, 2008 at 6:22 pm, thefoundingfathers said:

    I bought my house in 1989 when I was single. I live in the same house, but now with a wife and 3 children. I am a single income person in a double income world and here in the Baltimore - DC suburbs you need 2 incomes to afford anything with 4 bedrooms/2 baths in a reasonble school district.

    I wish now I could have gotten a big mortgage I couldn’t afford, defaulted and then received one of these 3% deals. It seems this is the new American Way, screw your mortgage company and be rewarded by the government so they can screw the taxpayer.

    First real estate industry artifically inflated the prices of houses with these idiotic mortgage schemes and now they are bailing the idiots out and keeping the prices inflated.

  52. #52
    On August 21st, 2008 at 6:31 pm, Grunt said:

    Was it really his fault? If he made the letter public then perhaps. If it was a private correspondence made public I would say no.

  53. #53
    On August 21st, 2008 at 8:32 pm, CoffeeGuzzler said:

    The 1st time I saw shuma was in 1993 during that stupid “assult weapon” thing. I didn’t like him then and I don’t like him now. Although he has never let me down. Back then I never expected anything good to come from the scumbag and like I say, he has never let me down in that area. Nothing good………ever

  54. #54
    On August 21st, 2008 at 10:11 pm, vickisoup said:

    It’s Schumer’s fault, yes.
    Here’s what the OTS (Office of Thrift Supervision) says: “The immediate cause of the closing was a deposit run that began and continued after the public release of a June 26 letter to the OTS and the FDIC from Senator Charles Schumer of New York.”
    It was a letter Schumer wrote privately to the feds, which he later leaked to the press.
    He did it to try and hurt the OTS, as evidenced by his response here: “If OTS had done its job as regulator and not let IndyMac’s poor and loose lending practices continue, we wouldn’t be where we are today.”
    Sorry, Grunt, but those were his comments; not mine.

  55. #55
    On September 25th, 2008 at 9:36 pm, a crapweasel said:

    What’s the point of bailing out these reckless and useless companies if the Government doesn’t at the very least:

    - Put an end to the Community Re-Investment Act

    - Convict Frank, Dodds and el at

    - Censure blabbermouted Chuck Schumer

    - Evoke heavy fines on Realtor’s, Mortgage Companies and banks that gave out loans to people with no means of ever re-paying them.

    - Convict CEO from said Banks, Mortgage Companies and Realtor’s

    - Make house flipping illegal

    - Convict groups like La Raza that told Illegals how to obtain mortgages illegally

    - And most importantly start mass deportation of illegal aliens and build the freakin fence

    Stupid lawmakers keep saying that Illegals help the economy. Yeah right! They helped it go straight to sh*#.

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