In 2011, Attorney General Eric Holder created a multi-agency working group called the Distressed Homeowner Initiative, the first ever effort aimed exclusively at targeting crimes against homeowners in the lead up to the financial crisis. Last October, the DOJ publicized its stunning success: 530 people had been charged criminally as part of the initiative. The actual figure, according to the DOJ, is 107—80 percent less. The DOJ claimed that the defendants had victimized more than 73,000 homeowners. That number is actually 17,185. And the department estimated that homeowner losses associated with the fraud was about $1 billion. The new sum is $95 million.
The DOJ's original tally included those people who were criminally charged in 2012, as well as defendants who were sentenced or convicted that year but charged before the task force had even been set up. The department also counted cases in which the victims weren't distressed homeowners.
"As a result, the announcement overstated the number of defendants that should have been included as part of the Distressed Homeowner Initiative," the Justice Department said upon release of the new numbers. Oops.
Three Bloomberg reporters deserve credit for outing Holder. A couple days after the attorney general first publicized the numbers last October, Phil Mattingly and Tom Schoenberg broke the story that some of the cases included in the DoJ's tally occurred before the initiative began. And Bloomberg reporter Jonathan Weil, after pestering the department for a list of all the people charged and their case details, wrote a column about the Justice Department's refusal to comply. That prompted the DoJ to reexamine its numbers.
As Weil noted at Bloomberg on Friday, this is the second time that Holder's Justice Department has inflated prosecution numbers related to the financial crisis. In December 2010, Holder held a press conference to talk up a sweep by the president’s Financial Fraud Enforcement Task Force. "All the Justice Department did was lump together a bunch of small-fry, penny-ante fraud cases that had nothing to do with one another," Weil writes.
More from Weil:
The Obama administration has been on the defensive for years over its lack of decisive, high-profile prosecutions related to the financial crisis. So it leads one to believe that might help explain why the feds have occasionally inflated their fraud statistics: to persuade the public that they were being tough on financial crimes.
Holder needs to come forward and explain exactly how this happened and why. He used a press conference with the cameras rolling to give out numbers that proved to be false -- and they appear to have been willfully false. He should be just as eager to hold another press conference to set the record straight, answer any questions about his apparent sleight of hand when it comes to financial-fraud metrics and apologize to the American people.
Six years ago, a major Pentagon investigation revealed that shady lenders were taking advantage of active-duty military by roping them into high-risk loans with astronomical interest rates. The Military Lending Act (MLA), which Congress passed in 2007, was supposed to fix the problem by capping annual interest rates on loans to service members at 36 percent. But lenders have found a way around the law, and lawmakers are fed up.
Here's the problem. When it passed the MLA, Congress left it up to the Defense Department to determine which types of loans would be covered by the interest-rate cap. At the time, Pentagon officials decided to only apply the interest rate cap to closed-end loans, which can only be used once and have to be paid back at a certain time. But the DoD allowed lenders to continue to offer service members high-interest open-end loans, which are like credit cards or lines of credit: they have varying balances, can be used multiple times, and have no set date for full repayment. These loans can sport interest rates of close to 800 percent.
Now members of Congress are pushing for the DoD, which has been reexamining the rule since June, to apply the interest-rate cap to open-end loans, too. Last week, a group of 23 Democratic senators—including Sens. Jack Reed (D-RI), Sherrod Brown (D-Ohio), and Elizabeth Warren (D-Mass.)—and 54 Democratic members of the House of Representatives wrote letters to the DoD demanding the Pentagon expand the interest-rate cap to cover more types of loans.
In 2009, Sarah Palin claimed Obamacare would create "death panels," or bands of bureaucrats who would decide whether old or disabled Americans were worthy of medical care. That notion turned out to be a figment of her imagination. But now, a growing cohort of Democratic lawmakers is cozying up to the idea, charging that the cost-cutting board that Obama's health care law creates will indeed hurt people on Medicare, The Hill reports.
Sen. Mark Pryor (D-Ark.) and Reps. Ron Barber (D-Ariz.), Ann Kirkpatrick (D-Ariz.), Kyrsten Sinema (D-Ariz.) and Elizabeth Esty (D-Conn.) have all signed onto bills repealing the powers of the Independent Payment Advisory Board, a panel created by the Affordable Care Act that will make recommendations on how to reduce Medicare spending once Medicare cost growth reaches a certain level.
The lawmakers have said they oppose the board because it would limit care for Medicare patients, even though the health care law says that any cuts would have to affect doctor reimbursement rates or the prices for certain drugs, not patient care.
All five lawmakers are worried about losing their seats in 2014. Barber, Kirkpatrick, Sinema and Esty have also voted with Republicans to delay the law's individual and employer mandates—the requirements that Americans purchase insurance and that employers of a certain size offer coverage, respectively.
The Democratic death panel fear-mongering follows an editorial that former Democratic National Committee chair Howard Dean wrote in the Wall Street Journal in July. He called for a repeal of the cost-cutting board because, he wrote, it would have the effect of rationing care by making it hard for doctors to make money from Medicare. Dean has worked as an adviser to a major DC lobbying firm that does work on behalf of the healthcare industry, which would see profits cut if the board goes into effect.
Major healthcare industry players like the American Hospital Association, the American Medical Association, and the pharmaceutical lobby have supported repeal of the board, arguing the panel would cut providers' pay arbitrarily.
Palin predicted folks would come around on death panels. "Though I was called a liar for calling it like it is, many of these accusers finally saw that ObamaCare did in fact create a panel of faceless bureaucrats who have the power to make life and death decisions about healthcare funding," she wrote on Facebook in 2012.
But Republican lawmakers don't seems to appreciate the Dems' aisle-crossing. The National Republican Congressional Committee slammed the Democrats for "desperately trying to jump off the ObamaCare train."
Obamacare is going to implant you with a microchip. Obamacare is going to tax your golf club. Obamacare is going to create a massive unprecedented federal database to hold all of your "intimate…secrets."
One of the largest components of the Affordable Care Act—the health exchanges from which Americans can buy discount health coverage—will go into effect on October 1. And that has right-wingers in conspiracy theory high gear. Here are seven conspiracy theories about the health care law, along with debunkings from the fact-check websites PolitiFact and Snopes:
The Claim: A chain email making the rounds this summer claims that a "hidden" provision of Obamacare taxes sporting goods as medical devices, including "Sport fishing equipment; Fishing rods and fishing poles; Electric outboard motors; Fishing tackle boxes; Bows, quivers, broadheads and points; Arrow shafts; Coal; Taxable tires; Gas guzzler automobiles." Yikes!
The Reality: Obamacare does impose a 2.3 percent tax on some medical devices to offset the added costs of expanding health coverage to the uninsured, which went into effect at the beginning of the year. But, as PolitiFact points out, none of the items listed in the chain email is labeled as a medical device by the federal Food, Drug and Cosmetic Act, which defines the types of devices that can be taxed. No, Obamacare won't be taxing your golf club after all.
The Claim: Another zombie chain email warns that Obamacare will deny old people cancer treatment: "Please for the sake of many good people, please… pass this on. We all need to be informed. YOU ARE NOT GOING TO LIKE THIS… At age 76 when you most need it, you are not eligible for cancer treatment."
The Reality: This particular email has been making the rounds for a good four years, according to Snopes, and is based on an old version of the law that didn't pass. But even that version of the legislation did not ration cancer care; in fact, the American Nurses Association says the cancer treatment section of that law would implement "the opposite of rationing. The section allows Medicare to pay cancer hospitals more if they are incurring higher costs." Similarly, there is no cut-off age for cancer treatment under the law that passed, known as Obamacare. "The claim is based on an inaccurate reading of a bill that went nowhere," PolitiFact concludes.
The Claim: Beware, Obamacare is going to implant a microchip in you, cautions yet another chain email batting around the internet: "This new Health Care (Obamacare) law requires and RFID [radio frequency identification] chip implanted in all of us. This chip will not only contain your personal information with tracking capability but it will also be linked to your bank account."
The Reality: As Snopes points out, "[C]laims that health care reform legislation will require such implantations date to the Clinton administration" and are "often linked to the 'mark of the beast' referenced in Revelations." The sections of legislation referenced in the email and others like it pertain to a passage in a previous version of the health care law that called for the creation of a registry that would allow the federal Department of Health and Human Services (HHS) to collect data about medical devices "used in or on a patient"—such as pacemakers or hip replacements—in order to track their effectiveness. Nothing in the Affordable Care Act calls for the government to stick a microchip in your wrist.
The Claim: Illegal immigrants will get health coverage under Obamacare, warns one widely circulated, oft-debunked, and still undead chain email.
The Reality: The health care law requires Americans (Americans) to purchase health insurance. Undocumented immigrants "don't have to follow the mandate because they shouldn’t be here," PolitiFact reiterates. "They [also] remain ineligible for regular Medicaid coverage, just as they are ineligible for food stamps."
The Claim: Thomas Jefferson warned of the dangers of government interference in health care. Here is the purported quote from our founding father, via a chain email: "If the people let the government decide what foods they eat and what medicines they take, their bodies will soon be in a sorry a state as are the souls of those who live under tyranny."
The Reality: Jefferson did write something similar in a book published in 1785 called Notes on the State of Virginia: "Was the government to prescribe to us our medicine and diet," he wrote, "our bodies would be in such keeping as our souls are now." The latter quote was transformed into the former in the 1990s, Snopes explains, and has been trotted out repeatedly as a caution against government meddling in private medical practice. But that wasn't Jefferson's argument; he was suggesting that legislating morality was as useless as legislating what a person eats.
6. Almost Everyone Who Works for a Small Business Is Getting Fired
The Reality: The Chamber study involved 1,300 small business executives, but PolitiFact did some digging and found out that the Chamber did not actually survey the entire group on whether they'd fire employees because of the law. Only 17 percent of survey members said they would be impacted by the law's so-called employer mandate. Out of that 17 percent of small businessmen and women, the study purportedly found that 75 percent of them said they would cut hours or replace workers, but Politico found that even that number was fudged by lumping survey questions together. Math shows that out of all small business execs in the study, only 5 to 9 percent actually said they would cut back hours or replace full-time workers in response to the health care law.
The Claim: In May, Rep. Michele Bachmann (R-Minn.) warned of a "huge national database" created by the health care law that will collect Americans' "personal, intimate, most close-to-the-vest-secrets." The claim has been widely discredited, but fringy conservative email chains continue to perpetuate the falsehood.
The Reality: The government is not constructing a database that collects, centralizes, and stores data. The health care law does create something called a Federal Data Hub which will allow HHS to extract data—such as whether a person already has health insurance—from already existing databases at other state and federal agencies. The hub will be used to verify consumer information when they are purchasing health insurance on the exchanges. The hub also has the ability to access income data and Social Security numbers, but that information already exists in other federal databases, "so the hub wouldn’t represent an expansion of federal data collection," according to PolitiFact. Brian Cook, a spokesman for HHS, told the fact-checking organization that the hub will have "strict privacy controls to safeguard personal information."
If President Barack Obama nominates Janet Yellen, the second-ranking official at the Federal Reserve, to be the next chairman of the central bank, she would be the first woman to ever occupy the post. This fact—and reports that Obama is considering former Treasury Secretary Lawrence Summers for the same post—has prompted editorialsworrying that Yellen wouldn't be up to the job, as well as more subtle attacks on her lack of "gravitas."
Although Obama has spoken of the importance of diversity in his administration, his inner economic team is a boys' club, says Sheila Bair, a former head of the Federal Deposit Insurance Corporation who has pushed publicly for Obama to pick Yellen to run the Fed. The top administration jobs that most affect the financial industry, Bair explains, are the chair of the Fed, the secretary of the Treasury, the head of the New York Federal Reserve, and the comptroller of the currency. And although there have been a few women in other top economic policy positions in the Obama administration, none of these big four spots has ever been filled by a woman.