NEW YORK - Government officials Friday warned Wall Street that it will be held responsible for the practices of the subprime lenders it helps to finance.
In the third of five joint regional forums on predatory lending, the Washington officials said large Wall Street firms should be held accountable for the terms of loans that go into securitized pools. "It's not going to be enough to say, 'We didn't know,' " said Andrew Cuomo, secretary of Housing and Urban Development.
"We have a situation where the bottom-feeders in society are reaching up to the titans of society. We need to break that link," said Sen. Charles E. Schumer.
The forum was held in the World Financial Center, home of Merrill Lynch & Co. and Lehman Brothers, which was recently named a co-defendant in a class action against subprime lender First Alliance Corp. of Irvine, Calif. The Association of Community Organizations for Reform Now picketed outside the firms' offices, chanting, "Black or poor, we pay more."