Progressive organizations who were hopeful that the foreclosure fraud investigative unit would do its job are still waiting for the promised investigators to be idenditified and begin work. Some groups are starting to believe they’ve been had, fearing the announced unit was just to buy them off. No kidding.

New York Attorney General Eric Schneiderman renewed his work on behalf of investors in the $8.5 billion Bank of America mortgage backed securities settlement yesterday. He filed papers with the New York state Supreme Court (a trial level court in New York), seeking to intervene in the case. His intervention begins to show the limiting effects of the broader mortgage fraud settlement.

CREDO, the online progressive organizing group, alleges in a new email to supporters that the Justice Department has not delivered the promised (and paltry) number of 55 staff members to the RMBS working group, the task force co-chaired by New York Attorney General Eric Schneiderman to investigate the mortgage securitization practices of the leading banks. No investigators means not investigations, and time is running out.

Stephen J. Baum, the New York-based foreclosure mill law firm which drew attention last year after photos cropped up from a Halloween party featuring its employees dressed as homeless people, reached a settlement with the New York Attorney General Eric Schneiderman over the filing of unverified, unsubstantiated and outright fabricated documents with state courts. Under the settlement, Steven J. Baum will pay a $4 million fine and its top two attorneys, Baum and Brian Kumiega, may not handle foreclosure cases for lenders or servicers in New York state courts for two years. This is on top of a $2 million fine Baum paid to the US Attorney for the Southern District of New York last October. Baum will share the fine with Pillar Processing, the document processor it used on the vast majority of cases.

Once again, Baum will not have to admit or deny wrongdoing in the case, and while this is the largest fine of a foreclosure mill law firm in the history of this foreclosure fraud saga, that’s not saying much.

A suit by Eric Schneiderman against MERS and three banks who used MERS was supposed to be carved out the larger settlement. It was unclear how you could allege the banks’ deceptive use of MERS led to the creation of false documents, and still release the banks on foreclosure fraud claims. You can’t. Schneiderman just settled the MERS suit with the three banks and two others, for a measly $25 million. And the Delaware and Massachusetts suits against MERS were folded into it as well.

Dayen’s news roundup from Tuesday evening, sans the GOP primary, with other stories about the foreclosure settlement, HUD IG reports, Ben Bernanke, Eric Schneiderman, Spain, banksters, Rebecca Brooks, Sarah Palin, health insurance exchanges, Afghanistan shootings, T. Boone Pickens, Goldman Sachs, Rush Limbaugh, labor, Dick Cheney avoids Canada, and much more.

We learned today that one prominent voice would not serve as staff director of the RMBS working group, the investigatory panel looking into securities fraud by the big banks. We don’t know who the working group will ultimately select. But Chris Whalen does give a theory as to how the working group, if Eric Schneiderman gets his way, could proceed.

We’re going to get a lot of theater in the next year, with big talk about enforcement actions. In that regulatory filing by Wells Fargo, they also highlight what are known as “Wells notices,” essentially early warnings that they are about to be sued by the SEC over mortgage backed securities disclosures. Of course, every recent SEC litigation on MBS issues has ended up with a settlement where the offending company didn’t have to admit or deny wrongdoing. Unless there’s a gung-ho prosecutor/director of the investigative unit, this probably won’t change.

There’s nobody who hates navel-gazing more than I, so I will try to dispense with this quickly. Glenn Thrush thinks I’m wrong to attribute the same perspective on Eric Schneiderman to Tom Miller, who dissed him on the record, and Shaun Donovan.

Whether you believe in Eric Schneiderman’s ability to deliver a legitimate investigation on mortgage securitization fraud or not, you have to admit that the united front on opposition to a settlement on foreclosure fraud collapsed the moment that he agreed to helm that federal investigatory task force. Now Iowa AG Tom Miller is publicly denigrating Schneiderman’s role in setting the terms, claiming he didn’t do much.