The Monster: How a Gang of Predatory Lenders and Wall Street Bankers Fleeced America—and Spawned a Global Crisis

The rotten core of deceit and fraud that precipitated the collapse of the subprime mortgage industry receives a thorough examination from Hudson (editor of Merchants of Misery), a former Wall Street Journal staff reporter. This lengthy appraisal unambiguously attributes the 2008 financial collapse to "schemes that preyed on the weak with the help of large financial institutions," tracing the roots of the toxic system to late 1980s Orange County, Calif., where Ameriquest founder Roland Arnall pushed his employees to sell dubious high-interest mortgages at a hectic pace, and fraud, forgery, and hidden fees locked borrowers into loans they couldn't afford. At a rival subprime lender, FAMCO, salesmen followed "The Track" and "The Monster," techniques that made it all but impossible for borrowers to get out of financially ruinous deals. As business grew, Wall Street figured out how to package these high-risk loans and make money on reselling them, even as the original borrowers defaulted. With crisp prose and a brisk narrative, Hudson reveals a culture of willful blindness, baldly predatory behavior, and evasion of responsibility. (Oct.)