Why Did IndyMac Implode?
A report quotes customers and ex-employees claiming the firm fudged incomes and pressed for
dubious loans
This article is for subscribers only.
When IndyMac Bancorp (IDMC) began sinking last year from mortgage losses, CEO Michael W. Perry pinned much of the California thrift's woes on outside forces: speculators, plunging home prices, and the collapse of the Wall Street machine that purchased its mortgages.
But advocacy group Center for Responsible Lending suggests a different reason in a 22-page report it published before IndyMac was seized by regulators on July 13. Says Michael Hudson, a CRL senior investigator: "There was a culture of top-down pressure to push through as many loans as possible—and to ignore the problems."