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Blame game continues as Lopez-Cantera fingers Sink in mortgage crisis

Borrowers_banner_2Miami Rep. Carlos Lopez-Cantera today continued the blame game emerging over who should have known that Florida's regulation of mortgage brokers was a riddled with holes, as the Miami Herald's series exposed this week.

In a letter to Chief Financial Officer Alex Sink's legislative director, Lopez-Cantera says that she should have been asking more questions and getting more answers if she really wanted to prevent mortgage fraud and calling for Don Saxon's resignation now is "too little too late.''  Download letter_from_carlos_lopezcantera_to_department_of_financial_services.pdf Download letter_from_dfs_to_representative_carlos_lopez_cantera.pdf

"Alex Sink is the top economic cop in this state. Why wasn't mortgage fraud a higher priority?'' Lopez-Cantera asks. He notes that she campaigned on the promise that "I will ask the tough questions." 

It's all more proof that lots of folks in Tallahassee are in serious damage control mode. Sink called for Saxon's resignation the day the Herald series ran. Lopez-Cantera notes that he sponsored legislation last session to crack down on mortgage fraud and Sink never showed a peep of interest in it.

But that raises more questions: Should legislators reviewing the issue of mortgage have been asking these questions too? Should they have asked why the 2006 law to ban felons wasn't enforced. And what about Sink's predecessor Tom Gallagher? Didn't he support the structure of Saxon's office to allow for the full Cabinet to have oversight? Did he ask these questions?

"It's not our job to make sure laws were enforced,'' Lopez-Cantera answers. "It's our job to pass laws.''

UPDATE: House Democratic Leader Dan Gelber offers this response to Lopez-Cantera: 

"Rep Lopez-Cantero's accusations would be funny if the issue wasn't so tragic. Seriously, the idea that the CFO bears blame for a problem that, according to the Herald, was almost entirely baked before she was even elected in 2006 is ludicrous. Further, it was the legislature that in 2003 took away from the CFO any direct oversight over the  Office of Financial Regulation (OFR) and instead made the entire cabinet responsible for the hiring and firing of the head of OFR."

Comments

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HectorinMiami

Is Rep Gelber biting more than he can chew here..? First off, how dare he think that laughing off Rep Lopez-Cantera's speech (even misspelling his own colleague's last name) is the proper response to these very legitimate questions... the mortgage crisis in this state is under his watch as the house minority leader as well... If what Rep Gelber is right in saying about the reduced oversight authority the CFO has then why was that authority reduced? And no matter if he is right or wrong, why is he coming out to defend a cabinet officer who has ultimately left the state's financial services is a worse condition than in which the CFO first came into office with?

P.S. Where the heck is Rep Gelber's quote from? It looks like it was copied and pasted while the formatting was not changed to reflect the font and size of the text of this blog.

HectorinMiami

After doing a little research it seems that Mr. Gelber does know how the previous CFO, Tom Gallagher, reacted to a similar mismanagement situation when in September of 2003 Mr. Gallagher ordered an audit of the Department of Education's management of the Corporate Tax Credit Scholarship Program in which millions were being misspent.

In that case, Mr. Gelber criticized the audit and demanded (and rightly so) an overhaul of the program.

With this in mind I wonder why Mr. Gelber is not criticizing Mrs. Sink's lack of involvement in this crisis when at the very least her predecessor Mr. Gallagher performed an audit when faced with similar circumstances.

Now, I do know that there should be some politics involved here because they, that is Mr. Gelber and Mrs. Sink, are among the highest ranking Democrats in Florida and as the affiliation entails that they will naturally defend one another.

However, I would hate to see the review of Mrs. Sink's performance draw up along party lines. Instead, let the blame rest on all the parties involved. If it is the whole cabinet then yes, it is the whole cabinet. And if blame extends into the legislature then so be it.

Now, as for Mr. Lopez-Cantera's statement that the legislature has no responsibility to oversee the state's various departments is a terrible remark to make. This state exists under a republican form of government and as such there are procedural checks and balances that must be maintained when one branch (in this case, the executive) fails in its oversight capacity. Of course, I have no idea where the quote comes as it appears to be disconnected from the rest of the post.

However, Mr. Lopez-Cantera's claims and questions are still very much dead on. The "buck" for the most part does stop with the CFO. When internal regulators within the various departments fail in their oversight duties as this case it is the CFO who serves as an important regulatory safeguard.

We didn't see the CFO come in this time so now the legislators are required to act (before an all-out public revolt occurs). Mr. Lopez-Cantera is performing his duty and I for one applaud his effort. I look forward to saying the same about Mrs. Sink's performance soon as well.

floridascamsuncovered

Bull, Rep Gelber, in the case of Peter J Porcelli II (Safe Harbour Foundation, Silverstone Lending LLC) Crist, McCollum, Sink and Saxon were notified by the victims as to what was going on. They all were provided a very detailed folder containing federal court doc's, FTC doc's, yet passed the buck right back to the OFR'S office. Their attorneys had the certified copy of Porcelli's, Tomasulo's and Harris's "Permanant Injunctions Barring them from Any Credit Related Products" from 2004 which was totally ignored.

WHY?????

They had more than enough evidence against Porcelli, Tomasulo and Harris to put into place a "emergency order to cease & desist" from allowing them to continue to take victims homes, did they no! They stood by as these criminals evicted families onto the streets.

WHY?????

WHY?????

They were also informed that in March 2007, Porcelli was indicted for scamming over 165,000 americans in a credit card scam. Yet allowed Porcelli to continue to evict homeowners? They also were informed in August 2007 that Porcelli was convicted. They also were informed when Porcelli was sentenced to 13 yrs in a federal prison and had to pay back 12 million to the victims. Yet they still did nothing.

WHY?????

Please don't say because other agencies were involved, it was clearly stated by the US Attorney's office that they would never request the OFR not to take actions in any on going cases involving the OFR. So that blows that theory.

All your heads should roll, not just Saxon's for this horrible mess. The state of florida needs to remove Crist from the Governors Mansion, McCollum from the Attorney Generals office, Sink from her office and place caring and competent individuals in those empty positions.

No wonder why Florida is the #1 state for all types of fraud, just take a good look at who is in these state offices.

avictimoffraud

Now Crist is about to sign a bill that will farther victimize those who have already lost their homes and money to the criminals given licenses by requiring the fraud to take place after 2011 to get any restitution from a victims fund that the OFR stole the money from years ago.
Shouldn't those responsible be forced to compensate these victims????

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