House Sends Anti-Fraud and Financial Crisis Commission Bill to the President

Mortgage fraud has reached near epidemic levels -- with FBI mortgage fraud investigations more than doubling in the last three years. Corporate frauds, like the $65 billion Ponzi scheme perpetrated by Bernie Madoff, are being uncovered as the economy has worsened, exposing many investors to massive losses. This afternoon, the House passed the Fraud Enforcement and Recovery Act by a vote of 338-52 -- investsing in the Justice Department and other agencies to hire prosecutors, agents, and analysts to aggressively pursue mortgage, corporate, and other financial fraud.

This bill also creates an outside commission to investigate the causes of the current financial and economic crisis in the United States -- similar to the investigation of the Pecora congressional subcommittee that examined the Stock Market Crash of 1929. This outside bipartisan commission will produce a detailed and clear-eyed examination of what went wrong by the end of 2010. Not only is this critical to bring accountability to a financial system that has rewarded irresponsible risk, it will help inform Congress as we move forward with common sense reforms to prevent these crises from happening in the future.

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Speaker Pelosi on passage:

The Fraud Enforcement and Recovery Act will restore common sense to our mortgage lending industry and bring the highest standards of accountability and transparency to the use of taxpayer funds, preventing and prosecuting fraud in the use of TARP and economic recovery funds.

This bill will also establish a 10-member, congressionally-appointed 'Financial Crisis Inquiry Commission' to examine the causes of the financial and economic crises. While the Commission undertakes its investigation, Chairman Barney Frank and the House Financial Services Committee will continue their ongoing work to reform federal oversight of our financial markets, and to reform lending practices to protect consumers.

In addition to the Fraud Enforcement and Recovery Act, Congress is working this week to send President Obama the Helping Families Save Their Homes Act to prevent home foreclosures and the Credit Cardholders' Bill of Rights to end unfair credit card practices that lock consumers into debt. We are also working to send the President legislation bringing accountability to Pentagon spending with procurement reforms that will save taxpayers hundreds of billions of dollars by cracking down on waste and cost overruns.

With these initiatives, and the major legislation we have already passed, we are making great progress to move America in a New Direction, and starting to make possible a broadly shared and lasting prosperity for all Americans.