Friday, April 20, 2018
Editorials

Editorial: Citigroup's big fine doesn't cover damage done

The $7 billion that Citigroup agreed to pay on Monday to settle a federal investigation into its irresponsible handling of subprime mortgages sounds like a hefty penalty. But it is not nearly enough to cover the damage created by the reckless behavior of Citigroup and other banks that contributed to the nation's economic meltdown. That is why it is important that the deal does not eliminate the possibility of criminal prosecution of bank executives and that the Obama administration does not back down on increased regulation of the financial industry.

Attorney General Eric Holder bragged that the fine includes a record $4 billion civil penalty, but let's put the numbers into perspective. While Citigroup will pay a total of $7 billion, it received $45 billion in taxpayer bailouts during the 2008 economic collapse. And $7 billion is just more than half of Citigroup's $13 billion profit last year. While Holder expects the fine to serve as a deterrent against risky mortgage lending practices, it is not going to leave a permanent mark. Citigroup's second-quarter earnings announced Monday beat expectations, and its stock price opened nearly 4 percent higher following news of the settlement, which brings some certainty for investors.

At least Citigroup did accept some responsibility and acknowledge wrongdoing. It agreed to a statement that bank employees knew some mortgage loans did not meet guidelines for credit scores for home buyers or were based on inflated appraisals. So Citigroup just made sure grades on some loans were changed and put them into bundles of subprime mortgages, effectively duping investors who had no idea what they were really buying. That was exactly the sort of behavior that helped overheat the housing market and trigger the worst economic collapse since the Great Depression.

Holder agreed Monday that the deception "shattered lives," yet the Citigroup settlement money directed toward helping borrowers is not in proportion to the damage left behind in Florida and in thousands of households. The settlement includes $2.5 billion aimed at helping homeowners, including $820 million toward a program to modify mortgages or forgive some debt so homeowners would no longer owe more than their homes are worth. Smaller amounts will go to help homeowners refinance mortgages and finance affordable rental housing. The Obama administration should ensure that the assistance gets to homeowners as soon as possible and does not get tangled up in red tape as other mortgage relief efforts have in Florida and elsewhere.

This is neither the first nor the last check the Justice Department will collect from the banks that did so much damage to the economy. JPMorgan Chase & Co. settled last year for $13 billion and was able to make a large part of the payment tax-deductible. That was strongly criticized in Congress and elsewhere, and at least Citigroup's $4 billion fine will not be tax-deductible. Meanwhile, the Justice Department is expected to turn toward negotiating a settlement with Bank of America. Those talks reportedly stalled last month, suggesting there is still a significant gap between what the bank is offering and what the Justice Department will accept. That settlement should eclipse the JPMorgan deal.

Holder called Citigroup's behavior "egregious" on Monday and said the settlement is appropriate. But for too many homeowners who lost their homes and too many neighborhoods that have yet to recover from the economic collapse, it is too little, too late.

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Editorial: When they visit Nature’s Classroom, kids are right where they belong

Editorial: When they visit Nature’s Classroom, kids are right where they belong

The Hillsborough school district planted a fruitful seed with the opening of Nature’s Classroom five decades ago on the cypress-lined banks of the Hillsborough River northeast of Tampa. • The lessons taught there to some 17,000 sixth graders each yea...
Published: 04/20/18
Editorial: Why single-member districts would be bad for Hillsborough commission

Editorial: Why single-member districts would be bad for Hillsborough commission

Anyone looking to make Hillsborough County government bigger, costlier, more dysfunctional and less of a regional force should love the idea that Commissioner Sandy Murman rolled out this week. She proposes enlarging the seven-member board to nine, e...
Updated: 9 hours ago
Editorial: Improving foster care in Hillsborough

Editorial: Improving foster care in Hillsborough

A new foster care provider in Hillsborough County is poised to take over operations in May, only months after its predecessor was fired for what was alleged to be a pattern of failing to supervise at-risk children in its care. Many of the case manage...
Published: 04/18/18

Another voice: Back to postal reform

President Donald Trump is angry at Amazon for, in his tweeted words, "costing the United States Post Office massive amounts of money for being their Delivery Boy." Yet in more recent days, Trump has at least channeled his feelings in what could prove...
Published: 04/17/18
Updated: 04/18/18
Editorial: Congress should protect independence of special counsel

Editorial: Congress should protect independence of special counsel

A bipartisan Senate bill clarifying that only the attorney general or a high-ranking designee could remove a special prosecutor would send an important message amid President Donald Trump’s attacks on the investigation into Russia’s inter...
Published: 04/16/18
Updated: 04/17/18
Editorial: Don’t fall for Constitution Revision Commission’s tricks

Editorial: Don’t fall for Constitution Revision Commission’s tricks

The Florida Constitution Revision Commission has wasted months as a politically motivated scam masquerading as a high-minded effort to ask voters to improve the state’s fundamental document. The commission on Monday added amendments to the Nove...
Published: 04/16/18
Editorial: Redner’s court win on medical marijuana sends message

Editorial: Redner’s court win on medical marijuana sends message

Florida regulators have done far too little to make voter-approved medical marijuana widely available for patients suffering from chronic illnesses. A circuit court judge in Tallahassee ruled last week there is a price for that obstruction, finding t...
Published: 04/15/18
Updated: 04/16/18
Editorial: Hillsborough commission should quit expanding urban area

Editorial: Hillsborough commission should quit expanding urban area

Any movement on modernizing local transportation is welcome, even small steps like the million dollars the state recently approved to design a Tampa Bay regional transit plan.But the region won’t make any progress on transportation, its single most p...
Published: 04/13/18
Updated: 04/18/18

Editorial: Fight harder on citrus greening

A new report by scientists advising the federal government finds no breakthrough discovery for managing citrus greening, a chronic disease killing Florida’s citrus industry. This should be a wake-up call to bring greater resources to the fight.The re...
Published: 04/11/18
Updated: 04/13/18

Editorial: Floridians should focus more on health

A new snapshot of the nation’s health shows a mixed picture for Florida and the challenges that residents and the health care community face in improving the quality of life.Americans are living longer, exercising more and doing better at managing th...
Published: 04/11/18
Updated: 04/13/18