A Hearty Issue

Wow! I’m a longtime small-market gardener who sells at our local farmers’ market. I struggle in the summer to get through all of The Nation’s magazines; I barely have the time to keep up with them. But the special issue “The Future of Food” [Oct. 30] was like reading a copy of Acres U.S.A. (This is an eco-agriculture magazine that keeps us up to date on what’s going on in the organic- and sustainable-farming communities.) The writing was as thorough as any Acres article on the Monsanto and GMO issues. All of the short articles in the forum “The Future of Food” were on target. The Kernza article [“Hacking the Grain”] was superb and, though we don’t grow grains, had me wanting to try it! “What Is the Recipe for Home?” was sad and yet heartwarming, and I’ll be trying the fatteh recipe. It was an amazing issue of well-researched and well-documented articles. Many, many thanks for getting this information out to an audience that might not have been as aware! Jan Dawson bellefontaine, ohio

Shell Games

David Dayen’s special investigation “Jamie Dimon and Other People’s Money” [Oct. 23] is fundamentally flawed in its premise.

Dayen sings the praises of Larry Schneider, a vulture debt buyer who has filed a whistle-blower suit and separate racketeering case against JPMorgan Chase. My own report shows that Schneider repeatedly foreclosed on family after family. He threw families from their homes at Christmas, abandoned homes to municipalities, and appealed one foreclosure all the way to the Minnesota Supreme Court, where he lost.

Unmentioned in Dayen’s article is that Schneider already lost the whistle-blower case. Judge Rosemary Collyer ruled that the loans in question were written off years before the 2012 fine. Therefore, it was impossible for Chase to claim credits for the write-offs.

In an ongoing appeal, the Department of Justice adds, “The United States declined to intervene in this suit and does not take the position that Chase failed to comply with the terms agreed to in the National Mortgage Settlement.” The DOJ’s disagreement with the core assertion, which is crystal clear, is also conspicuously absent in Dayen’s piece.

There were a small number of cases where Chase did write off loans it sold. Missing from The Nation’s piece is that Chase offered to buy back every erroneously forgiven loan at a 50 percent premium. Also missing is that Schneider, the vulture debt buyer, refused to sell.

Dayen interviewed one family, the Warwicks. He omits that Schneider purchased their $160,413 loan for only $10,500. Chase mistakenly forgave it and told the Warwicks. When alerted, Chase promptly offered to buy the loan back from Schneider at a premium so the bank could properly forgive it. Schneider refused, and Chase eventually repurchased the loan at full face value, after the Warwicks had been paying Schneider for three years.

Michael Olenick paris, france

David Dayen Replies

I don’t think of Larry Schneider as a saint. I do not endorse how he chooses to run his business, nor did I “sing his praises” in the article. But his case illuminates the actions of a far more powerful institution, which I found newsworthy regardless of the messenger. Whoever Larry Schneider is, he purchased a bundle of loans from JPMorgan Chase, which proceeded to continue to pursue collection on those loans and keep payments intended for Schneider for itself. Then Chase forgave a number of the loans as part of an attempt to obtain credit for federal mortgage settlements. I don’t think it’s worth dismissing that conduct because of the business practices of the investor who was subjected to it.

This pattern of facts was not limited to Schneider; Chase’s own internal documents identify 108 loans from 21 different third-party investors, out of a sample of 500 (over one in five). Contrary to Mr. Olenick’s assertion, Chase did not offer to buy back nearly half of the 108 erroneously forgiven loans. Furthermore, the scale of JPMorgan Chase’s erroneous loan forgiveness exceeds that initial population, as Schneider identifies hundreds more of his loans that Chase subsequently forgave. Chase has only admitted to the first 108.

Mr. Olenick’s allegation about Schneider’s whistle-blower case is a complete misreading of Judge Collyer’s ruling. He’s referencing a part of the ruling that involves the Home Affordable Modification Program, which I never referred to in my story. In fact, we know the date on which the forgiveness letters I reported on began: September 13, 2012, several months after the signing of the National Mortgage Settlement. The letters all reference “a recent mortgage servicing settlement reached with the states and federal government,” i.e., the National Mortgage Settlement.

Judge Collyer’s rationale for dismissing Schneider’s National Mortgage Settlement claim is entirely a technical matter about failing to follow certain dispute-resolution steps. The Justice Department found that reasoning so shoddy that it submitted an amicus brief in the appeal asking to throw out the ruling, and sought time in oral arguments to make its case. So one of the most deregulatory Justice Departments in history found the ruling to be dangerous and overly generous to JPMorgan Chase. Given Judge Collyer’s history of accepting arguments from financial institutions (see MetLife v. Financial Stability Oversight Council, among others), this is not surprising.

Finally, the idea that Chase offered restitution for a portion of its conduct and should therefore be absolved of all blame is in fact Chase’s own argument in legal pleadings. I believe Chase’s actions here were egregious: selling loans and continuing to collect on them, and then forgiving loans it had no interest in whatsoever. I think these actions should be scrutinized, up to and including Jamie Dimon’s involvement. I have little expectation that this will occur, but I thought it important to reveal.

David Dayen los angeles

Stars and Semiautomatics

Stephen Kroninger’s “OppArt” version of the US flag on page 8 of the October 23 issue hit me right in the gut and our dominant culture right on the nose. “OppArt” isn’t quite appropriate, however: Kroninger’s “flag” is Op-Op-Pop-Pop-Bang-Bang Art. Steve Coffman dundee, n.y.

Correction

A graphic on page 39 of the “Future of Food” issue [Oct. 30] misrepresented the percentage of beef in the United States that is packed by National Beef. The actual number is 13, not 15, percent.