Justifying IndyMac: avoiding accountability through regulations.

Marcelino
Corniel lost his life in the Iraq war. IndyMac then lost between $71,000 and
$36,000 of the $370,000 life insurance policy Corniel purchased to
ensure the livelihood of his family.

.

I can’t say that I was shocked so much as I
was disappointed when I viewed reader responses on our website.
Some comments blamed Corniel’s mother, Elaine Lopez, for investing poorly, while others seemed
to equate losing a son in war with winning the lottery.

I don’t dispute that Lopez could
have invested her money more wisely, but at the same time it’s not like she went out and bought a Cadillac. Lopez placed $70,000
in a money market checking account and the remaining $300,000 in a
CD, from which she used the $1450 a month interest yield to sustain her
family.

I believe Lopez, when she says that
IndyMac Bank managers persuaded her not to withdraw the money by
claiming the addition of a third beneficiary would insure the entire sum.

The Monday after the news of Indy
Mac’s financial trouble broke, I went to Indy Mac and spoke with
patrons. My questions were met by belligerent customers who informed
me that bank representatives warned them against speaking with the
press, and cited the media as a cause for Indy Mac’s problems.
Funny, I don’t remember receiving a check from Indy Mac for managing
their stocks to 23 cents a share, what they were prior to any
article running.

Despite my Ivy League education, the
hours I spent reading regulations, the two interviews I conducted with
securities lawyers, and numerous calls to the Federal Deposit
Insurance Company, I still fail to understand how the FDIC is not
returning somewhere between $36,000 and $71,000 of Lopez’s money.

Sure, Lopez was nave for taking
the word of a bank manager. But I bet she wasn’t the only one to lose
money because of promises made by IndyMac representatives. It’s
possible that IndyMac’s employee’s weren’t intentionally deceiving Lopez. Maybe bank officials just didn’t comprehend the same regulations that
two securities lawyers, and a financial adviser failed to understand
well enough to answers my questions.  But should incompetence excuse so-called officials from accountability?

When did regulations start to cloud
our understanding of right and wrong? After all regulations are
created by men, frequently flawed, and certainly subject to change.

Some have argued that Lopez should feel
lucky to still have $300,000. Why? Because her son went to great
lengths to protect his family? The $370,000 wasn’t a gift from the
government or a death benefit, but something that Corniel payed for
with both his money and life.

Despite promises that he would be a
recruiter, and by the spring of 2005 Corniel was back in Iraq, stationed
with the 184th Infantry out of Fullerton, CA..The 184th
was sustaining heavy causalities when Corniel decided to purchase
the additional $170,000 in life insurance.

As an Iraq veteran, I knew a lot of
servicemen who declined to pay the $40 a month for the  $250,000 in Serviceman’s Group Life
Insurance. At the same time I was never aware of anyone who sought additional life insurance. But Corniel,
who was the patriarch of his family, wanted to ensure that his two
younger sisters and mother were taken care of in the event of his
death.

On New Years Eve  of 2005, most
23-year-old-Americans were drinking themselves into stupors while
Corniel was defending their freedom to do so. As a former Marine
attached to “Killer” company, Corniel had already seen a good deal
of combat. But unlike some men, he didn’t try to get a family
hardship discharge and avoid his second tour. Corniel sacrificed his
life for our freedom, with the knowledge his family would be able survive in his absence.

Corniel’s legacy was intended to send
his sisters to college, and support his illmother, not pad the bank
accounts of rich men, as some would argue his service did. I urge
Americans to remember Corniel as they drive their yellow ribbon
adorned sport utility vehicles. And think about the regulations that
qualify the loss of his legacy, while justifying the outlandish
incomes of IndyMac’s executives.  In the end you can blame Lopez for mismanaging the money, but don’t think it couldn’t happen to you.

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  • http://havish.wordpress.com/about-me/edumacation/ Miss Havisham’s Tea Party

    Terrible amount of lies going around, old chap.

    Malicious ones that rob and kill.

    I feel vetty sorry for this family.

  • Robert C. J. Parry

    Corniel was in my battalion. I did not know him, but distinctly remember the day he died.

    It’s shameful that anyone would mislead the mother of any dead person, but especially a soldier.

    But, I think, in the end, we will find ethics, morals and “doing the right thing” were not strong suits of Indymac.

  • A solider’s famly

    Our prays to Corniel’s family. He gave the ultimate to his countrymen. Shame on the execs at IndyMac. We’ve potentially lost 1/3 of our savings there too. Not to distract from the price Corniel and his family continue to pay, but how did Mutual of Omaha move in so quickly on the two banks closed by FDIC in Arizona on July 25?