Obama’s moneywoman was a subprime mortgage queen [Karl]
The Wall Street Journal’s John R. Emshwiller notices that Penny Pritzker — Barack Obama’s national campaign-finance chairwoman — helped run Hinsdale, IL-based subprime-mortgage lender Superior Bank to its collapse in 2001:
Ms. Pritzker served as Superior chairman until 1994. During that period, Superior “embarked on a business strategy of significant growth into subprime home mortgages,” which were then packaged into securities and sold to investors, according to a 2002 report by the Treasury Department’s Inspector General.
“Superior was at the forefront of the securitizing of subprime mortgages,” says Timothy Anderson, a retired bank consultant who has studied Superior and other failed thrifts.
Indeed, as noted here back on May 20, Anderson hasÃ‚Â been quoted as saying that Ã¢â‚¬Å“SuperiorÃ¢â‚¬â„¢s owners were to sub-prime lending what Michael Milken was to junk bonds.Ã¢â‚¬Â
TheÃ‚Â far-Left In These Times ran a detailed account of Superior’s collapse in November 2002:
After federal regulators closed the $2.3 billion Superior Bank in July 2001, investigations revealed that the suburban Chicago thrift was tainted with the hallmarks of a mini-Enron scandal. New legal developments are adding additional twists, including racketeering charges. And yet the bankÃ¢â‚¬â„¢s owners, members if one of AmericaÃ¢â‚¬â„¢s wealthiest families, ultimately could end up profiting from the bankÃ¢â‚¬â„¢s collapse, while many of SuperiorÃ¢â‚¬â„¢s borrowers and depositors suffer financial losses.
Even taking into account the Ã¢â‚¬Å“recordÃ¢â‚¬Â settlement they made with the FDIC, the Pritzkers could make more than $700 million in additional profit for running a financial institution into the ground. They had already profited handsomely, sharing in the more than $200 million in dividends to the owners in the Ã¢â‚¬â„¢90s. They accomplished all this with an investment of about $21 million for each partnerÃ¢â‚¬â€though the Pritzkers had also already benefited from $645 million in tax credits.
It is a story with the potential to dwarf that of Obama’s ex-Veep vetter, James Johnson.Ã‚Â But it would require the media to do some legwork to uncover whether — and to what extent — Penny Pritzker profited from the very financial wheelings and dealings Obama condemns on the campaign trail.Ã‚Â So I am not holding my breath waiting for the follow-up reportage.