There’s nothing new in the blockbuster mortgage fraud case New York’s attorney general filed against JPMorgan Chase last week. But despite being stale, it still counts as a bold, meaningful response to the financial crisis, because it’s more than anyone in Washington has been able to muster.
New York is just now going after JPMorgan for the housing bubble excesses of Bear Stearns, the investment bank that JPMorgan absorbed as the economy imploded four years ago. New York’s lawsuit alleges that Bear committed “systemic fraud on thousands of investors.” It claims JPMorgan bought Bear’s crimes along with the bank itself. But the meat of New York’s lawsuit — the bleak mortgage data, the gratuitously expletive-laden internal bank e-mails, and the sordid tales of a bank fleecing its own customers — has been public for years.