Oklahoma Attorney General Opts-Out on a Substandard Settlement. For Ethical Reasons?

Every Thursday evening at Fairplay Realty-Elite is dedicated to what we call “Opportunity Night.”  Opportunity Night is probably the most important event in the Fairplay Realty arsenal.  It is on this night that the various territory managers come together and present their most enticing deal structures to our investor clients.  This is also the night that several of our clients that are enduring the emotional rollercoaster of an impending foreclosure will potentially be relieved of that stress as an investor steps up and puts an offer in on their shortsale property.  This week I have been asked to coordinate Opportunity Night.  The challenge right now is that we are all having a dickens of a time locating foreclosure and shortsale properties that can be purchased.  How can it be so?  We certainly can walk down virtually any block in the state of Oregon and point out the foreclosed homes?  But, it seems, the banks have frozen all transactions.  Of course they could never acknowledge this fact because they would be in violation of any number of laws including: collusion, anti-trust, redlining…just to name a few.  My supervisor, Jeff Potts, has stated that I must find at least 5-6 purchasable properties or we risk having our investor-clients putting their money back in the stock market.  As I contemplated this insane condition I came across another story that both explains and parallels the circumstances that we are facing at Fairplay Realty-Elite…

All who know me have endured my rants as I have voiced my displeasure with the latest Obama Administration offer to the banking industry: Settle the mortgage quagmire you are responsible for…for a paltry $28 billion dollars. I realize that $28 billion is not a small sum as it relates to the net worth of an individual.  But in the grand scheme of the national destruction caused by the mortgage fiasco, and the fact that the settlement doesn’t allow for anything close to a share that would close the loss gap incurred by the average U.S. homeowner – $28 billion is without question “paltry.”

My initial reaction when I heard that there was a rogue state that had chosen not to participate in the settlement was that this would likely be explained as courageous individualism on the part of that state’s leaders.  I suspected that such individualism had to have emanated from Massachusetts, Minnesota, or Oregon. Needless to say, I was beyond shocked when I was informed that it was actually the state of Oklahoma?  Odd, “I thought Oklahoma was a red state ?”  It turns out that the great state of Oklahoma didn’t hold out for benevolent reasons.  The state’s conservative attorney general thought that the mortgage settlement was a great place to stage the obligatory ideological protest. You know, to keep up the charade of the 2-party system.

So much for identifying a non-partisan political issue.  I would later learn that Okie Attorney General, Scott Pruitt,  has never been one to miss an opportunity to take a swipe at the Obama Administration.  While not an avid fan of the current administration myself, I find it maddening that public officials that were elected to effort solutions for societal ills continue to fall prey to the status quo by engaging in unproductive rhetoric designed to make the other side look incompetent. How can this behavior be seen as purposeful as the people whom they have been elected to work on behalf of continue to suffer?  It is childish and an abdication of legislative responsibility to continue to entrench your constituents in the downward spiral of events by seizing every opportunity to re-route an issue to more partisan confrontation.

I recently read a blog by a guy named Foster Kamer titled, ‘Did Oklahoma A.G. Scott Pruitt, Mortgage Settlement Holdout, Sell Out His State for Wall Street?’ In the article the blogger offers evidence that in the past the Attorney General (“AG”) had accepted financial gifts from a litany of Wall Street-affiliated financial institutions and therefore was complicit in choosing to withdraw from the settlement as a result of his support for the financial industry.  He offers (as damning evidence) a letter drafted by the AG of Oklahoma, Mr. Pruitt, to the lead AG on the settlement, the AG from the state of Iowa.  In the letter, the Oklahoma AG posits awkward claims that a settlement would lead to an unfair advantage for those who are the recipient’s of settlement funds over persons who continue to dutifully make their mortgage payments without assistance (insert: “intervention”)?  While I think the blogger has certainly tapped into an obvious trail of evidence, I would also offer that the trail is too obvious to assume it is a path to the truth. It would be akin to Peter Falk’s ‘Colombo’ wrapping up an episode in the first 5 minutes based upon the evidence he’s led to by the beautiful vixen in the bikini!

The Obama Administration is clearly beholden to the interest of the financial services industry over the needs of the people who elected him. The Obamites, and the two administrations prior to them, have each shown a propensity toward a failure to hold institutions accountable in the same way that they expect individual responsibility to be adhered too.  This is particularly true for those individuals that are farthest removed from the sphere of power.  I cannot concede the to the concept that one party is for the little guy, and the other party is for big business.  Both are a shill for the institutions, make no bones about it.  What the AG of Oklahoma is doing, is his part to maintain the facade of differentiation/opposition.  Shame on you Mr. Pruitt commingling such a foundational piece of Americana, housing, with partisanship.  I wouldn’t be so quick to grab that low-hanging fruit Mr. Kamer. If you have designs on a long-term political career, moves like this could come back to haunt you.


About asuomason

Graduate Student, Conflict and Dispute Resolution - University of Oregon
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