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Democrat Barney Frank’s Legacy: Housing Crisis and Prostitution Ring

Posted by FactReal on November 30, 2011

Frank Should Go to Jail
Orchestrated the Housing Crisis:
Accountability hasn’t always been Frank’s strong suit. In his retirement press conference at Newton’s city hall, the congressman expressed no regrets for his handling of Fannie Mae and Freddie Mac during his past decade of service on the House Financial Services Committee, both as chairman and ranking member.

Frank was a cheerleader for policies that helped inflate the housing bubble that burst painfully in the 2008 financial crisis. Like many politicians, he encouraged lenders to relax their credit standards with the goal of promoting home ownership. According to one report, “Frank pushed [Fannie Mae] to loosen regulations on mortgages for two- and three-family homes, even though they were defaulting at twice and five times the rate of single homes, respectively.”

The risks were obvious, but rising housing prices obscured the danger. Political activists and federal regulators were leaning on banks to approve risky loans, with government-sponsored Fannie and Freddie leading the way on subprime lending.

When new regulations were proposed, Frank accused supporters of worrying about the GSEs’ financial soundess “to the exclusion of concern about housing.” He steadfastly denied that there was anything wrong with the government-backed mortgage finance firms. Frank insisted “these two entities, Fannie Mae and Freddie Mac, are not facing any kind of financial crisis.”

Yet Fannie and Freddie failed, racking up at least 12 million risky loans and accounting for roughly 40 percent of those still outstanding.

[How the housing crisis was created]

Ran Prostitution Ring Out of his Apartment:
In 1991, Barney Frank received an official reprimand for reflecting “discredit upon the House.” The reprimand came as a result of his relationship with a man named Steve Gobi, a male prostitute whom Frank initially paid $80 for sex. Frank later took Gobi to live with him in his home, making him a personal aide. He paid him $20,000 in compensation (unreported to the IRS) and let him use his car. Subsequent investigation revealed that in the course of their relationship, Frank used his congressional office and stationary to fix Gobi’s 33 parking fines. Frank also used his congressional letterhead to write a reference letter to Gobi’s probation officer — Gobi was under court supervision as a convicted felon with a prison record — in which he gave false information. Most damningly, the investigation found that Gobi ran a prostitution ring from Frank’s home. In his defense, Frank asserted he knew nothing of Gobi’s illicit enterprise.

The Democrat -controlled House voted 408-18 to reprimand Frank after a heated debate during which some Republicans demanded expulsion. They pointed out that the claim that Frank did not know of Gobi’s criminal activities was incredible to say the least.

[Roll call vote here]

[Congressional Record 101st Congress (1989-1990), July 26, 1990: Search for page H5633]

Slept with top Fannie Mae executive while he wrote laws that benefited the firm:
Barney Frank’s lover Herb Moses “was Fannie’s assistant director for product initiatives. Moses worked at the government-sponsored enterprise from 1991 to 1998, while Frank was on the House Banking Committee, which had jurisdiction over Fannie.” Frank wrote housing and banking laws and his boyfriend was a top executive at a firm that benefited from those laws. Frank protected Fannie Mae and Freddie Mac:
Barney Frank became involved in another questionable — and possibly criminally tainted — relationship with a man called Herb Moses. Moses, whom Frank called his “spouse,” was a high-level executive at Fannie Mae from 1991 until 1998. Dubbed a “mortgage guru” by the National Mortgage News, Moses boasted that he helped develop “many of Fannie Mae’s affordable housing and home improvement lending programs.” It was, of course, these kinds of programs that ultimately led to the collapse of the subprime mortgage market that wiped out trillions dollars from the economy and produced the economic turmoil that we now face. Even though there were those warning against the precarious nature of the enterprise, Barney Frank — whose committee oversees Fannie Mae and Freddie Mac — kept resisting reforms and besmirching those voicing concerns. […]

Frank continued to claim almost until the day of the collapse that the two mortgage giants were financially sound. If we lived in a sane world, Barney Frank would be compelled to testify about his culpability in the current crisis and what role his romantic involvement with Herb Moses — as well as the campaign contributions he received from Fannie and Freddie — played in his shilling for these two moribund institutions.

MORE
Rep. Frank Admits to Helping ‘Ex-Lover’ Get ‘Lucrative’ Fannie Mae Job, While Regulating Mortgage Giant
The One Thing No One Is Mentioning In Their Barney Frank Tributes: The Prostitutes
Frank ‘Vacationed’ With Bailout Recipient
More Barney Frank Lies Exposed
Barney Frank Cashes Out
CNN Eulogizes ‘Titan’ Barney Frank

One Response to “Democrat Barney Frank’s Legacy: Housing Crisis and Prostitution Ring”

  1. […] THESE FACTS FINANCIAL CRASH ● Clinton and Democrats Created the Financial Crash (More here.) ● Democrat Barney Frank’s Legacy: Housing Crisis and Prostitution Ring ● How Democrats created the mortgage crisis with the Community Reinvestment Act […]

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