Editor's note: This video is republished with permission of Rachel Dollar and FraudLine. View the original here. Rachel Dollar, an attorney and creator of the Mortgage Fraud Blog, discusses the role of fraud in the financial crisis with Robert Russell, former counsel to the director of the U.S. Office of Thrift Supervision, in this FraudLine segment.Russell said, "Fraud and misrepresentation played a central role" in the current financial crisis. Outright fraud in the subprime market, coupled with the "complexity and lack of transparency" in exotic financial instruments, were key contributors to the economic calamity, he said.What will restore trust in the system?He suggested a few fixes:"Mortgage brokers must be licensed and registered.""All mortgage originators must play by the same set of rules -- there must be no room to arbitrage the regulatory system.""Underwriting must establish the ability of the borrower to pay."Originators sh...
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