No Mortgage Lenders in Jail, but a Borrower Lands There | In Prison for Taking a Liar Loan

In Prison for Taking a Liar Loan

A few weeks ago, when the Justice Department decided not to prosecute Angelo Mozilo, the former chief executive of Countrywide, I wrote a column lamenting the fact that none of the big fish were likely to go to prison for their roles in the financial crisis.

Soon after that column ran, I received an e-mail from a man named Richard Engle, who informed me that I was wrong. There was, in fact, someone behind bars for what he’d supposedly done during the subprime bubble. It was his 48-year-old son, Charlie.

On Valentine’s Day, the elder Mr. Engle said, his son had entered a minimum-security prison in Beaver, W.Va., to begin serving a 21-month sentence for mortgage fraud. He then proceeded to tell me the tale of how federal agents nabbed his son — a tale he backed up with reams of documents and records that suggest, if nothing else, that when the federal government is truly motivated, there is no mountain it won’t move to prosecute someone it wants to nail. And it was definitely motivated to nail Charlie Engle.

Mr. Engle’s is a tale worth telling for a number of reasons, not the least of which is its punch line. Was Mr. Engle convicted of running a crooked subprime company? Was he a mortgage broker who trafficked in predatory loans? A Wall Street huckster who sold toxic assets?

No. Charlie Engle wasn’t a seller of bad mortgages. He was a borrower. And the “mortgage fraud” for which he was prosecuted was something that literally millions of Americans did during the subprime bubble. Supposedly, he lied on two liar loans.

“The Department of Justice has made prosecuting financial crimes, including mortgage fraud, a high priority,” said Neil H. MacBride, the United States attorney for the Eastern District of Virginia, in a statement. (Mr. MacBride, whose office prosecuted Mr. Engle, declined to be interviewed.)

Apparently, though, it’s only a high priority if the target is a borrower. Mr. Mozilo’s company made billions in profit, some of it on liar loans that he acknowledged at the time were likely to be fraudulent and which did untold damage to the economy. And he personally was paid hundreds of millions of dollars.  Though he agreed last year to a $67.5 million fine to settle fraud charges brought by the Securities and Exchange Commission, it was a small fraction of what he earned.  Otherwise, he walked.  Thus does the Justice Department display its priorities in the aftermath of the crisis.

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8 Responses to “No Mortgage Lenders in Jail, but a Borrower Lands There | In Prison for Taking a Liar Loan”
  1. Jason Werner says:

    The guy claimed he was making $400ger a year. What a joke. Where the bleep were the underwriters and QC. Unbelievable. As sickened as I am that the bank executives are still getting away with their crimes, I’m glad they got that crook borrower; I hope they get the others involved in his crime too (UW, QC, LO, LO manager, bank’s regulator, etc.).

  2. l vent says:

    RT news Thom Hartmann show had an interesting segment on last night about how many states are now having cops throw people in DEBTORS PRISON for as little as a $1000.00 credit card debt, yet not one BANSTER OR WALL STREET CRIMINAL HAS BEEN THROWN IN PRISON.. I guess there has not been and actual debtors prison in America since the late 1800’s. I guess in Indiana the cops are so busy throwing debtors in prison that they are not going after the real criminals. They are throwing people in prison WHO CAN’T FIND A JOB. WTF!!!!!! THIS IS COMPLETE NAZI GERMANY STYLE WARFARE AGAINST THE PEOPLE WHO CANNOT PAY THEIR BILLS MOST OF THE TIME THROUGH NO FAULT OF THEIR OWN. THEY PROBABLY CANNOT EVEN AFFORD TO FILE BANKRUPCY BECA– USE THAT IS EXPENSIVE. THIS IS FACSIST COMMUNISM, NOT AMERICAN DEMOCRACY. WAKE UP AMERICA!!! LOOK AT WHAT THESE FOREIGN HIJACKERS ARE DOING TO THE AMERICAN PEOPLE WHO WERE ROBBED OF EVERYTHING BY THEM.. THIS IS OUR COUNTRY, NOT THEIRS.

  3. Justice for all…if you are a deadbeat not a Banker

  4. If you are not on the jury you do not have much to know about what to comment from hearsay of an article, especially if you did not sit through the whole trial or none of it, this is why the appeals court does second guess a jury in the facts as a transcript does not tell everything either.

  5. John says:

    That is a simple answer. Look at the paperwork you get delivered to you when charged. it says, The Untied States of America versus YOUR NAME.

    How do you think that makes any Vet feel.

  6. Officer of the Law says:

    Who do the prosecutors work for?

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