Wall Street Accountability

Executive Summary

The economic and financial crisis has demonstrated that the current financial regulatory system permits banks, mortgage brokers and servicers, and other firms to enrich themselves at the expense of ordinary Americans. Abusive and fraudulent mortgages sold to unsuspecting homeowners fueled the housing crisis while credit card companies used deceptive billing practices to mire cardholders in debt. The federal government responded to this situation by assisting the financial services industry when firms like AIG, Morgan Stanley, and Citigroup were at risk.

The $700 billion TARP program and trillions of dollars more in cheap loans and guarantees have allowed the financial services sector to return back to their former status in health, profits, and gigantic compensation packages. Meanwhile, middle-class Americans continue to face foreclosure and abusive lending and credit card practices in addition to extended bouts of unemployment. It's time that Congress listened to the middle class citizens and hold Wall Street and their counterparts accountable for the epidemic that is taking place in this nation's financial structure.

There are two phases or components of an action plan that I would like to propose as an alternative that addresses the issues that are presented. These components will be discussed in detail on the following pages with a conclusion at the end.

The Action Plan for Change

* Hold Wall Street Accountable: Wall Street financial institutions committed fraud by selling sub-prime mortgage derivatives at the same time they were gambling against those derivatives with credit default swaps. They took outrageous risks on highly leveraged bets. It end up costing American taxpayers hundreds of billions of dollars and brought our economy on the edge of collapse. I agree with others that Wall Street should be required to repay their debt. This is your issue and information in your non-market analysis. Here we have identified the issue and in the next paragraph we will concentrate on the non-market action.

* Wall Street Should Support the Consumer Financial Protection Agency: The Wall Street Reform and Consumer Protection Act's creation of a Consumer Financial Protection Agency is a critical innovation to protect ordinary Americans from deceptive and abusive lending practices. While consumers are currently guarded from faulty products like toasters, no single agency is tasked with overseeing the financial products and services - from credit cards to mortgages and student loans - that Americans rely on every day to earn a middle-class standard of living.

The CFPA will be empowered to root out products and services that are harmful to aspiring middle-class and middle-class Americans. It will promote equal access to safe credit products and root