Obama's subprime pal: Penny Pritzker

The Chicago Sun-Times reports:

White House hopeful Barack Obama talks a lot on the campaign trail about how failing banks have used subprime loans to victimize customers.

"Part of the reason we got a current mortgage crisis has to do with the fact that people got suckered in to loans that they could not pay," he told a crowd in Reading, Pa., last week. "There were a lot of predatory loans that were given out, a lot of teaser rates. Banks and financial institutions making these loans were making money hand over fist."


One of the banks that went under after making a lot of subprime loans -- leaving 1,400 of its customers without part of their savings -- was Chicago's Superior Bank.

At the helm of Superior Bank at least some of the time was Obama's national finance chairwoman, Penny Pritzker, an heiress to the Pritzker fortune.

Obama's campaign notes that Pritzker stepped down as chairwoman of the bank's board in 1994, seven years before it failed. She then went on the board of the bank's holding company.

But a letter obtained by the Chicago Sun-Times shows that until the end, Pritzker appeared to be taking a leadership role in trying to revive the bank with an expanded push into subprime loans.

Pritzker wrote in May 2001 that her family was recapitalizing the bank, and she pledged to "once again restore Superior's leadership position in subprime lending." The bank shut down in July 2001.

Pritzker's attorney Kevin Poorman and Obama's campaign spokesman emphasized that not all "subprime lending" is the "predatory" kind that Obama and White House rival Hillary Clinton rail against. The kind of subprime lending Superior was doing in 2001 was not predatory, Poorman said.

But at least some of the 1,400 victims who are still owed money seven years after the bank failed say Pritzker is the wrong person for Obama to put in charge of the campaign's finances when part of his campaign is about reforming the banking industry.

"They still owe me $113,000," said Fran Sweet, 63, of Downers Grove, who deposited her $480,000 retirement account at Superior a month before it collapsed. "To the Pritzkers, this is nothing. They probably think, 'Why pay her back?' That's nothing. But we're all upset that someone who made these decisions could be in that position."

This is Penny Pritzker of the famous Chicago Pritzer family.For a look on how the Pritzer's are tied to The Chicago Mob and Sydney Korshak.