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PBS’ Frontline: Fraud Was . . . The F-Bomb”

Posted by Larry Doyle on January 22, 2013 7:29 PM |

I will be watching Frontline this evening on PBS as a documentary on fraud within the mortgage industry airs. This show, The Untouchables, will interview a number of mortgage due diligence underwriters.

What did they have to say? This 5-minute Frontline preview says a lot, including ….

“Fraud in the due diligence world, fraud was the F-word or the F-bomb,” said Tom Leonard. “You didn’t use that word,” 

How do you spell “RACKET?”

For those who would like to view the entire 53-minute documentary, I welcome providing,

Watch The Untouchables on PBS. See more from FRONTLINE.

Watch The Untouchables on PBS. See more from FRONTLINE.

Watch The Untouchables on PBS. See more from FRONTLINE.

Watch The Untouchables on PBS. See more from FRONTLINE.

Larry Doyle

Isn’t it time or overtime to subscribe to all my work via e-mail, an RSS feed, on Twitter or Facebook.

I have no business interest with any entity referenced in this commentary. The opinions expressed are my own. I am a proponent of real transparency within our markets so that investor confidence and investor protection can be achieved.

  • Bill

    Need to institute in this country something akin to the old English Court of Star Chamber, the function of which was to adjudicate cases against those whose wealth and power rendered them immune to the processes of the ordinary courts.

    • LD

      Bill,

      You piqued my interest with the reference to the Court of Star Chamber so I had to look it up. What do we learn? I find the punishments highlighted below to be of particular interest. Perhaps we might think about reinstituting some of those today. Time in the pillory (aka, the stock) sounds particularly appealing. Thanks for taking us into a corner of our landscape we had not yet navigated.

      The Court of Star Chamber, known simply as the Star Chamber, was a supplement to common-law courts in England. The Star Chamber drew its authority from the king’s sovereign power and privileges and was not bound by the common law.

      The Star Chamber was so named for the star pattern on the ceiling of the room where its meetings were held, at Westminster Palace.

      Origins of the Star Chamber:

      The Star Chamber evolved from the medieval king’s council. There had long been a tradition of the king presiding over a court composed of his privy councillors; however, in 1487, under the supervision of Henry VII, the Court of Star Chamber was established as a judicial body separate from the king’s council.

      Purpose of the Star Chamber:

      To oversee the operations of lower courts and to hear cases by direct appeal. The court as structured under Henry VII had a mandate to hear petitions of redress. Although initially the court only heard cases on appeal, Henry VIII’s chancellor Thomas Wolsey and, later, Thomas Cranmer encouraged suitors to appeal to it straight away, and not wait until the case had been heard in the common-law courts.

      Types of Cases Dealt with in the Star Chamber:

      The bulk of the cases heard by the Court of Star Chamber involved property rights, trade, government administration and public corruption. The Tudors were also concerned with matters of public disorder. Wolsey used the court to prosecute forgery, fraud, perjury, riot, slander, and pretty much any action that could be considered a breach of the peace.

      After the Reformation, the Star Chamber was used — and misused — to inflict punishment on religious dissenters.

      Procedures of the Star Chamber:

      A case would begin with a petition or with information brought to the attention of the judges. Depositions would be taken to discover the facts. Accused parties could be put on oath to respond to the charges and answer detailed questions. No juries were used; members of the court decided whether to hear cases, passed verdicts, and assigned punishments.

      Punishments Ordered by the Star Chamber:

      The choice of punishment was arbitrary — that is, not dictated by guidelines or laws. Judges could choose the punishment they felt was most appropriate to the crime or criminal. The punishments allowed were:

      Fine
      Time in the pillory (or stocks)
      Whipping
      Branding
      Mutilation
      Imprisonment

      Judges of the Star Chamber were not permitted to impose a sentence of death.

      Advantages of the Star Chamber:

      The Star Chamber offered expeditious resolution to legal conflicts. It was popular during the reigns of the Tudor kings, because it was able to enforce the law when other courts were plagued by corruption, and because it could offer satisfactory remedies when the common law restricted punishment or failed to address specific infractions. Under the Tudors, Star Chamber hearings were public matters, so proceedings and verdicts were subject to inspection and ridicule, which led most judges to act with reason and justice.

      Disadvantages of the Star Chamber:

      The concentration of such power in an autonomous group, not subject to the checks and balances of common law, made abuses not only possible but likely, especially when its proceedings were not open to the public. Although the death sentence was forbidden, there were no restrictions on imprisonment, and an innocent man could spend his life in jail.

      The End of the Star Chamber:

      In the seventeenth century, the proceedings of the Star Chamber evolved from above-board and fairly just to secretive and corrupt. James I and his son, Charles I, used the court to enforce their royal proclamations, holding sessions in secret and allowing no appeal. Charles used the court as a substitute for Parliament when he tried to govern without calling the legislature into session. Resentment grew as the Stuart kings used the court to prosecute nobility, who would otherwise not be subject to prosecution in common-law courts.

      The Long Parliament abolished the Star Chamber in 1641.






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