Bankruptcy Attorney to Bernanke: Get a backbone!

WARREN, Mich., June 13, 2011 /PRNewswire/ -- A prominent Bankruptcy attorney is calling on Washington not to back down on banking reforms.

Michael Greiner, a Detroit area Bankruptcy attorney who founded the website www.myeasy7.com, warned people that the banks and their Washington allies are already taking steps to further weaken the already weak regulations imposed on them as a result of the current financial crisis. At a conference of bankers in Atlanta the other day, JP Morgan Chase CEO Jamie Dimon confronted Federal Reserve Board Chairman Ben Bernanke about banking regulations, saying that they are too burdensome on the banks. Bernanke responded favorably to Dimon's points, and since then a growing chorus of bankers and their Washington allies have been calling to dismantle the recently-passed Dodd-Frank banking reform bill.

"I don't know why anyone is listening to these guys," Attorney Michael Greiner said. "After what they did to our economy, they're lucky they're not in jail."

Greiner said that more banking reforms are needed, not fewer. "Our regulatory structure was picked apart in the 1980's and 1990's," Greiner said. "The result is the great recession of the 2000s. These banks are making tons of money. Jamie Dimon's bank Chase is making a $20 billion profit this year. I'm not going to feel sorry for these guys after what they did to our economy. Nobody should."

Greiner detailed three steps he believes Congress should take immediately to help get our economy on track. "The banks oppose these steps," Greiner said, "but at this point, who cares":

1. Pass bankruptcy reform legislation that will allow bankruptcy judges to reset residential mortgages: The current economic crisis has largely been driven by the real estate crisis. Real estate values have dropped farther and faster than in the Great Depression. But banks' solution to this crisis has been more foreclosures. Greiner said that the Bankruptcy Code allows judges to reset the amount owed on commercial mortgages to the value of the real estate. Greiner said that legislation to allow judges to do the same with residential mortgages would help bring this crisis to an end. "Finally, we would have a way to force the banks to be reasonable," Greiner said.
2. Require banks to lend more aggressively to small businesses and homeowners: The banks are making huge profits now because they took the TARP bailout funds and held onto that money, according to Greiner. He said that the government, as part of its relationship to the banks through the FDIC, the Small Business Administration and the Federal Reserve could require banks to lend more funds for small business expansion and for the purchase of new homes. These steps, Greiner said, would help get our economy going again.
3. Break up the banks: "Anti-trust means nothing. The smallest banks are now too big to fail," according to Greiner. Until we make sure that no bank is too big to fail, we will always be at risk of having to bail them out again.

"The banks have spent millions lobbying against these steps," Greiner said. "They are now trying to get their way bit by bit without anyone noticing. Unless we keep our eyes on the banks and their Washington buddies, we will find ourselves in another meltdown all over again."

Greiner is the founder and President of the Financial Law Group, a Detroit-area law firm specializing in Bankruptcy. He has represented thousands of individuals, businesses and creditors in Bankruptcy. He is also the writer of the recently-published Bankruptcy 101: An Insider's Guide to Filing Chapter 7 Bankruptcy on your own without an Attorney, and he is the creator of the website myeasy7.com (www.myeasy7.com) which assists individuals in filing Chapter 7 Bankruptcy without an attorney. He blogs at www.myeasy7.com/blog.

SOURCE MYEASY7.COM