The Real Deal New York

Schneiderman defends role in Obama’s mortgage investigation unit

February 16, 2012 06:53PM
By Guelda Voien

From left: New York Attorney General and President Barack Obama

Reporters needled New York Attorney General Eric Schneiderman at a Crain’s breakfast forum this morning  where the AG announced his proposal for non-profit reform, saying that his appointment to the joint investigation unit has made it seem like he was “co-opted by the administration,” and would be less aggressive with banks as a result. But the AG defended himself and the administration, saying that the immunities granted for banks in the recently signed mortgage settlement were narrow, and that he intends to pursue the matters he is legally allowed to to the full extent of the law.

President Barack Obama announced the formation of the new taskforce to investigate home loans and mortgage-backed securities fraud in his state of the union address.

Among the suits Schneiderman will be able to pursue under the mortgage deal is the Mortgage Electronic Registry System lawsuit, which his office filed two weeks ago against major banks, alleging “deceptive and fraudulent” practices.

The AG called the alleged MERS abuses ”a challenging situation,” that resulted from deregulation “to the point of recklessness,” and added that property law was “absolutely fundamental to our way of life.”

He also said that although he and the business community have butted heads in the past, he is an advocate for the private sector. ”My role as a regulator is to catch the bad guys,” he quipped, “but also to help the good guys” do business. “Our financial markets are models to the world, and we should keep them that way.”

The breakfast was focused on Schneiderman’s proposed legislative changes, which would make it easier for non-profit organizations to form and operate in New York City, while also tightening oversight. He noted that one out of every five jobs in New York City is in the non-profit sector, which accounted for $200 billion in revenue for the state last year.

The AG also announced a new program, called New York on Board, which is intended to encourage dialogue between the business and non-profit communities, and help business leaders take part in non-profit leadership. He said that the commercial brokerage Cushman & Wakefield had already signed on as a participant.

Cushman & Wakefield could not immediately be reached for comment.

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