There are indications that the investigations being carried on by all the attorneys general of the states and other departments of the federal government are heading towards multi billion dollar settlement with the banks.

But the homeowners and housing advocates are not happy with it – they want the banks to be criminally prosecuted and jailed apart from the monetary fine. Nothing short of this would act as a deterrent for future repeat action. In fact during the savings-and-loan crisis 1,100 bankers had been put behind bars.

The head of NAP (National People’s Action) George Goehl had taken heart from statements given out by Tom Miller the attorney general of Iowa about putting “people in jai”. But lately the tone of Miller has mellowed.

When asked by union leader Mike McCarthy in a town hall meeting in Des Moines when this was going to happen and these people would be imprisoned, the response from Miller was tepid. He said that the officials of the law enforcement department were talking it over with the banks regarding prosecution.

Miller had replied that he didn’t feel like talking what would be or not be in the agreement. He said, “That’s something that we have to hammer out with the Justice Department and with the federal people and with the banks in a negotiating session”.

Lisa Donner of Americans for Financial Reform (a group pressing for more regulation) said this was not the time to target small goals. Speaking to HuffPost she said, “The record of abuses is astounding. There’s a lot of leverage for regulators and there’s a lot at stake”.

Even within the Federal Reserve some officials whose prime duty is to see to the banking system’s stability rather than the protection of consumers are raising concerns about the foreclosure abuses.

Sarah Bloom Raskin, the Fed governor of Utah State during a speech last February said that the foreclosure mechanism had “broken” because of “widespread” problems. Raskin even said that the bankers had acted illegally during foreclosure operations – it being something unheard of coming from an official of the central bank. She had said, “Going forward the … industry must foster an operational environment that reflects safe and sound banking principles and compliance with applicable state and federal law”.

All the other regulators (Federal Reserve, Treasury, Office of the Comptroller of the Currency, FDIC and Consumer Financial Protection Bureau) refused to comment on this matter.