Is it really appropriate to use the same “should have known” language for people with negative equity or too high a mortgage payment that is has been used for a smoker with emphysema?
If so, should we also blame victims of medical malpractice for failing to understand their own medical procedures?
Of course we can blame any lay person for mis-applied trust, but what is the end result?
The regulatory environment that arose during the Great Depression (Securities Exchange Act of 1934, Securities Act of 1933,) came about to restore trust in stocks and the stock market. It’s a testament to their effectiveness that it took over seventy years for Wall Street to subvert them. There will always be people willing to break the law, the problem arises when you can commit fraud without technically breaking the law; as evidenced by stock brokers in the 1920’s and mortgage brokers in this decade.
Hopefully, we will have the same political will, as in the 1930’s, to close this loophole without the financial upheaval of yesteryear.