Since it’s just us business reporters here—just us chickens—let me illustrate what I mean with a quiz. Match the allegation with the institution. Answers are at the end of the piece.

Allegation

1. Handed out copies of the movie Boiler Room as a training tape

2. Partnered to sell its “PayOption Arms” with a brokerage owned by a five-time felon, whose convictions included gun-related charges

3. Forbade loan officers to check borrower income on certain loans

4. Ran an “art department” in its Tampa office, where documents were altered.

5. Settled allegations of institutionalized marketing deception that covered two million customers

6. Developed “FastQual,” a program designed to approve borrowers in twelve seconds

7. Incentivized brokers and loan officers through “yield spread premiums” and other compensation schemes to put borrowers into more expensive loans

8. Tapped two kegs of beer at weekly staff meetings

Institution

A. Citigroup

B. Countrywide

C. Ameriquest

D. IndyMac

E. Merit Financial

F. New Century

G. All of the above

This is not a take-home exam. If you don’t get more than two of seven, I think we have work to do.

From 2004, Countrywide led the market in rolling out new “products” that were basically bureaucratic ways of approving a loan to anybody. The complaint said Countrywide threatened to fire underwriters for (my emphasis) “attempting to verify a borrower’s ability to pay.”

As the bank said in ads aimed at brokers:

More ways to say yes! Qualify more of your borrowers with Expanded Criteria programs from Countrywide®, American’s Wholesale Lender®. Countrywide offers some of the most flexible documentation guidelines in the industry.

Remember, this was not some fringe player. It was the firm that around 2004 was the nation’s largest home-mortgage originator. The market leader.

The complaint has plenty of examples of people blown out of homes they already owned by Countrywide products. A sixty-four-year-old widow with payments of $300 a month on a thirty-year, fixed-rate loan is put in a “3/27 interest-only loan with a fixed rate for only the first three years of the loan.” Never mind what it is; she couldn’t afford the $800 payments before the rate adjusted, Illinois says.

Perhaps she was irresponsible, as David Brooks would have it, or mad as a hatter. But Countrywide itself admitted to regulators in 2007, the complaint says, that 60 percent of borrowers in subprime hybrid arms “would not have qualified at the fully indexed rate”—that is, when the rate went up, as it inevitably did...

I realize that borrowers who signed the notes can never be fully let off the hook; no one knows what went on in the room at each closing—although the reporting of the last several years certainly yielded plenty of examples of loans made to stroke victims, the retarded, the elderly, the illiterate, and people who don’t speak English. A fine piece in April of this year by The Indypendent, a New York alternative paper, for instance, describes how an eighty-six-year-old Brooklyn man diagnosed with dementia decided it was a good idea to refinance his 5.95 percent, thirty-year, fixed-rate loan with an option ARM, an instrument that BusinessWeek described as “the riskiest and most complicated home loan product ever created.”

But more broadly, it pays to remember that the borrower is the amateur in this equation, someone who might execute a mortgage twice in a lifetime. A lender will do it a hundred times before lunch.

So, that’s what we know: the lending industry used marketing deception—including boiler-room tactics—on a mass scale against a class of financially vulnerable borrowers (which subprime borrowers are, by definition) and other middle-class financial amateurs already laboring with stagnating incomes and rising costs for health care, education, and, of course, housing.

Yet to be explored fully is the extent of Wall Street’s role, the size of the transfer of wealth between classes—from millions of civilians to thousands of professionals—that resulted, and the social and economic consequences of it all.