The Monster: How a Gang of Predatory Lenders and Wall Street Bankers Fleeced America--and Spawned a Global Crisis
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Who killed the economy? A page-turning, true-crime exposé of the subprime salesmen and Wall Street alchemists who produced the biggest financial scandal in American history "It's hard to have a guilty conscience if you don't have a conscience. Anything that benefited production - that benefited me and benefited my wallet - I'd do it."The sales force at Ameriquest Mortgage took this philosophy to heart. They watched the Hollywood white-collar-crime flick "Boiler Room" as a training tape, studying how to pitch overpriced deals to unsuspecting home owners. They learned how to forge signatures on mortgage paperwork and create fake documents in "cut-and-paste" operations they dubbed "The Lab" or "The Art Department."In this stunning narrative, award-winning reporter Michael W. Hudson reveals the story of the rise and fall of the subprime mortgage business by chronicling the rise and fall of two corporate empires: Ameriquest and Lehman Brothers. As the biggest subprime lender and Wall Street's biggest patron of subprime, Ameriquest and Lehman did more than any other institutions to create the feeding frenzy that emboldened mortgage pros to flood the nation with high-risk, high-profit home loans. It's a tale populated by a remarkable cast of the characters: a shadowy billionaire who created the subprime industry out of the ashes of the 1980s S&L scandal; Wall Street executives with an insatiable desire for product; struggling home owners ensnared in the most ingenious of traps; lawyers and investigators who tried to expose the fraud; politicians and bureaucrats who turned a blind eye; and, most of all, the drug-snorting, high-living salesman who tell all about the money they made, the lies they told, the deals they closed.Provocative and gripping, The Monster is a searing exposé of the bottom-feeding fraud and top-down greed that fueled the financial collapse. Library Journal Investigative journalist Hudson exposes the source of the so-called toxic subprime mortgages that led to the 2008 financial crisis. He picks his way through a warren of mortgage brokers and lending companies that sat just outside banking regulations in the years following the savings and loan crisis. The book concentrates on the practices of mortgage lenders FAMCO and Ameriquest Mortgage, at one point the largest U.S. subprime lender. Hudson draws on litigation files, government investigations, and first-person accounts to tell a story of pervasive fraud within both companies. Systematic lying and forging of documents on top of intense sales pressure resulted in unwary borrowers paying excessive up-front fees for mortgages with unsustainable, high interest rates. Hudson explains how the industry put off government regulation with aggressive legal defenses, political contributions, and donations to nongovernmental consumer watchdog groups like ACORN. His revealing indictment of the mortgage industry and regulatory inaction clarifies just who gained and lost in the subprime underworld. VERDICT This is essential reading for anyone concerned with the mortgage crisis. CNBC's documentary House of Cards (2009) is an excellent complement to Hudson's book.—Lawrence R. Maxted, Gannon Univ. Lib., Erie, PA
