"Three of the nation's largest banks said Friday that they expect to be sanctioned by the U.S. government for their foreclosure practices, securities filings show.
The disclosures come on the heels of reports federal regulators are nearing a multi-billion dollar deal to settle allegations that the biggest banks abused borrowers and illegally foreclosed on homes."
http://www.huffingtonpost.com/2011/02/25/banks-expect-penalties-foreclosure-probe_n_828552.html
Behaviorally speaking is this punishment?
Behaviorally speaking do you think this punishment will be effective?
Do you think the government could use differential reinforcement instead?
I don't know a lot about home loans and what it all entails. I also have not researched this topic enough to understand it. I have a lot of questions after reading that article.
I understand the banks are under investigation and are most likely going to have to pay a lot of money to the government for these faulty forclosures. However, why does the government get all of this money? They are not the ones who were taken advantage of, the homeowners were. Will the homeonwers that were wrongly forclosed get there homes back? I also think that banks are just another company like any other, they are going to make mistakes. I don't think they should have to pay this much out of pocket to the government in lawsuits when they should just investigate the forclosures and give back to the faulsified ones. If this goes through, and Well Fargo alone pays 1.2 billion dollars before the lawsuit, where will that put them and there customers.
This article only talked about Wells fargo (WF) particulary, and that they handle 1.8 trillion dollars in home loans. With that much, I think it would be inhuman to NOT make a few mistakes. Also, is WF the only bank being investigated? I think it is almost expected to have a small number of faulty forclosures. That being said, I still think that the bank should pay for their mistakes.
Yes, I think this is a form of punishment. Our books definition says, " a decrease in the strength of a response following the application or removal of a stimulus".
In this case, the behavior that decreses would be the amount of faulty forclosures.
A= banks handeling home loans
B= Banks illegally forclosing homes
C= Government investigating and suing banks
I think it will be effective for many banks, because they will take the extra initiative to be sure about foreclosers. However, I don't know how it will effect the banks being sued. They may go bankrupt and then the customers are affected too.
I am not sure how the government would differentially reinforce banks. If someone could elaborate that would be GREAT!
I also feel that this is a form of punishment as well. I feel that it is adding an aversive punisher though in the sense of the government suing the banks. I feel that the ABC of this incident are;
A=Banks doing home loans
B=illegally foreclosing homes
C=Government suing banks
I also do know a huge amount into this subject since I don't own a home or been interested in investment stuff too much quite yet. I also don't get why the government gets all this money from the banks for such things? This is also a confusing topic for me and I could use more information about it as well.
Like the few before me, I agree that this is a punishment:) I think that it is a punishment because it is getting rid of an aversive behavior. The government is punishing the banks by suing them, thus decreasing the likelihood of the bank to issue out loans.
The ABC's could potentially be:
A-banks giving out multiple home loans
B-banks then illegally foreclosing the home
C-The government then suing the bank.
Wouldn't it be that they were getting rid of a desirable behavior or adding an aversive behavior? This would be awful to not be able to trust your own bank.
I think this is a form of punishment because of the aversive behavior being eliminated. ( I feel like a huge repeat from the comments ahead of mine ):) Also though I feel that it can be a huge form of punishment that many clients of these national banks may potentially try to seek business elsewhere. Who wants to bank somewhere that they cannot completely trust? I don't! I am not going to lie I have the same ABC's as the other comments:
A: various loans given out
B: foreclosing illegally on homes
C: banks getting sued by government