WHAT: “Fraud,” “negligence” and “recklessness” are some of the words thrown around by the U.S. Senate Permanent Subcommittee on Investigations in its Tuesday report about Washington Mutual’s mortgage lending and repackaging practices. One Federal Deposit Insurance Corp. review of mortgages issued in 2005 by two of WaMu’s top-producing loan officers found outright fraud in 58 percent of the mortgages from one and 83 percent from the other.
WHAT ELSE: The FDIC did not properly recognize or halt WaMu’s shady dealings, according to an advance report from the Treasury Department inspector general.
WHAT’S BEING DONE: Washington Mutual was taken over by Bank of America in 2008, in a government-brokered fire sale. The goal of the current investigations is to find ways of preventing such abuses in the future — and to determine if any criminal charges should be filed.