Home > Non-Middle East > FDIC Suing WaMu Execs for $900 Million For Gross Negligence – Finally Some Common Sense

FDIC Suing WaMu Execs for $900 Million For Gross Negligence – Finally Some Common Sense

March 18, 2011
The Mallard, the archetypal "wild duck&qu...

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Wall Street Journal Reports:  FDIC Sues Ex-WaMu Executives

I cotton to the strong form of the Duck Theory (also known as the Duck Test):

  If it looks like a duck, swims like a duck, and quacks like a duck, then it’s a duck.”

So, I believe that it is clear that the top officials of the banks that got us into the Fukushima of the financial world should be personally held responsible for the crisis.  There was a reason they were being paid the big bucks (big bucks? Let’s call them humongous bucks).  They either knew about the great risks they were taking, or should have known about the risks.  That was why they were being paid so much.  There are not enough of the free-marketiers out there calling for stripping all of the wealth from these folks.  If you listened to some of the hearings the responsibility of these executives was evident.  The one that sticks most in my mind was when the head of mortgage credit control for Citibank testified that he had reported up to his superiors two or three years in a row that 70-80% of the mortgages they were writing did not meet the bank’s own internal credit criteria.  If that isn’t gross negligence, I don’t know what is.

And look, I don’t care if you put these guys/gals (though it seems to be exclusively guys) in jail.  But, please, take their money away.  They gambled with their depositors’ money and lost.  They should not benefit from that.

Categories: Non-Middle East
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