"Raskin Urges Penalties on Mortgage Servicers"

I talked to Jamie Galbraith briefly today at a session he was participating in here at the AEA meetings in Chicago -- he was a discussant on a panel talking, in part, about the problems in the financial sector that caused the crisis. More than anyone I know, Jamie has been asking why the F-word -- fraud -- is so absent from these discussion. I wasn't able to stay for his full remarks due to another commitment, but I thought about tweeting a bet that the word fraud would be used as some point during his presentation. I'm guessing he'd like this news:

Raskin Urges Penalties on Mortgage Servicers, Reuters: Federal Reserve Governor Sarah Bloom Raskin on Saturday said the Fed must impose monetary penalties on banks who entered into an April agreement with regulators over how to fix problems in their mortgage servicing businesses.

"The Federal Reserve and other federal regulators must impose penalties for deficiencies that resulted in unsafe and unsound practices or violations of federal law," Raskin said... "The Federal Reserve believes monetary sanctions in these cases are appropriate and plans to announce monetary penalties."

Raskin did not say when the penalties will be announced.

She said that "appropriately sized" penalties would "incentivize mortgage servicers to incorporate strong programs to comply with laws when they build their business models."...