US Senate Subcommittee Paints WaMu as Subprime Poster Child

In a Senate subcommittee panel hearing last month, Washington Mutual (WaMu) was painted as the poster child in the financial crisis sub prime lending debacle. Here are some excerpts from another source reporting on it:

"Washington Mutual built a conveyor belt that dumped toxic mortgage assets into the financial system like a polluter dumping poison into a river," said an outraged Levin (pictured). In its wake, WaMu and its peers have left the financial equivalent of a Superfund site that will take years and billions of dollars to clean up.

In the end, Levin's evidence and vivid imagery of WaMu's "toxic conveyor belt" leaves the lasting impression. And he rightfully points out that WaMu did not act alone. "Down river, there was Wall Street, with its huge appetite for these mortgage-backed securities," said Levin. "They bottled that polluted water, slapped a label on it from the credit rating agencies that said it was safe drinking water, and sold it to investors."

And let's not forget the watchdogs. On Friday, the inspectors general for the Treasury Department and the FDIC are expected to release a report criticizing the two agencies' oversight of Washington Mutual.