Update: Here's the US housing regulator's lawsuit against the big banks.
Local interest: The government is NOT suing Wells Fargo, PNC or other banks with lots of Philly-area branches. It IS suing Ally Financial (GMAC), which is partly based in Horsham. It's suing, big-time, Bank of America, whose consumer loan operations employ thousands in Wilmington.
The U.S. government's impending lawsuit against alleged villains of the 2008 financial collapse - big banks like Goldman Sachs and JPMorgan that sold billions in bad home loans they pretended were good home loans - on first thought seems late, and maybe dangerous.
Where was the government in the mid-2000s, when these reckless loans were being written, packaged and sold? And what good does it do to hold the banks responsible now, when many of their bosses have left, bankers have repaid their government bailouts (with interest), and business confidence remains shaky and vulnerable to blockbuster federal lawsuits and other shocks?
Makes more sense when you consider the plaintiff - the Federal Housing Finance Agency - has had to oversee the worst, costliest, and major still-unresolved part of the 2008-09 bailouts - at Fannie Mae and Freddie Mac, which lost billions, not because they guaranteed a lot of bad loans, but because, to finance good loans, they invested heavily in highly-rated mortgage-backed bonds that turned out to be secretly rotten with weak credits.
Late is better than never; but this could and should have been prevented. Financiers, traders, lenders and borrowers were greedy; government failed to protect them from each other. So now, to court.