Holder, Breuer connected to players in foreclosure fraud?
posted at 10:25 am on January 20, 2012 by Ed Morrissey
For years, the Left has asked why the Obama administration hasn’t pursued prosecutions against lenders who arguably engaged in fraud when foreclosing on mortgages in the wake of the housing-bubble collapse. It turns out that these lenders had friends in high places in the Department of Justice. Reuters reports that both Attorney General Eric Holder and his lieutenant Lanny Breuer, who ran the DoJ’s criminal division, were partners in a law firm that worked on behalf of those very same firms (via JWF’s Just A Grunt):
U.S. Attorney General Eric Holder and Lanny Breuer, head of the Justice Department’s criminal division, were partners for years at a Washington law firm that represented a Who’s Who of big banks and other companies at the center of alleged foreclosure fraud, a Reuters inquiry shows.
The firm, Covington & Burling, is one of Washington’s biggest white shoe law firms. Law professors and other federal ethics experts said that federal conflict of interest rules required Holder and Breuer to recuse themselves from any Justice Department decisions relating to law firm clients they personally had done work for.
Both the Justice Department and Covington declined to say if either official had personally worked on matters for the big mortgage industry clients. Justice Department spokeswoman Tracy Schmaler said Holder and Breuer had complied fully with conflict of interest regulations, but she declined to say if they had recused themselves from any matters related to the former clients.
Holder and Breuer aren’t alone. Reuters lists a couple more former Covingtom & Burling associates at the DoJ that have since returned to their law practice, including Holder’s deputy chief of staff John Garland and Breuer’s deputy chief of staff Steven Fagell. The law firm itself lists almost two dozen former attorneys now working in the DoJ and another dozen in US Attorney offices around the country. That’s quite an impressive footprint of influence for Covington & Burling, and a valuable one for its clientele.
It’s not as if the fraud was particularly esoteric, either. Reuters began its own reporting on massive numbers of forged endorsements, part of the robo-signing scandal that halted foreclosure processing for more than a year. Those forgeries got submitted to courts on many occasions as part of the foreclosure process. Despite this, Holder has done nothing — at least publicly — to press an investigation into these forgeries, and as Reuters reports today, more are on their way:
Recent calls for a wide-ranging criminal investigation of the mortgage servicing industry have come from members of Congress, including Senator Maria Cantwell, D-Wash., state officials, and county clerks. In recent months clerks from around the country have examined mortgage and foreclosure records filed with them and reported finding high percentages of apparently fraudulent documents.
On Wednesday, John O’Brien Jr., register of deeds in Salem, Mass., announced that he had sent 31,897 allegedly fraudulent foreclosure-related documents to Holder. O’Brien said he asked for a criminal investigation of servicers and their law firms that had filed the documents because they “show a pattern of fraud,” forgery and false notarizations.
I suspect this information will animate the Left against Holder much more than Operation Fast & Furious, but both need extensive investigation. Perhaps this will be the straw that broke the camel’s back and convinces Barack Obama to get a new Attorney General. If not, Republicans and Democrats alike will have plenty of opportunity to ask Obama why his Department of Justice seems more interested in cover-ups and political machinations than in law enforcement.