Liar's Loan Scandal

The Liar's Loan Scandal involved borrowers providing false or exaggerated information on mortgage applications to obtain loans they couldn't afford. Banks, often lax in verifying details, approved these loans, expecting the borrowers to repay. When many borrowers defaulted, it led to significant financial losses for lenders and contributed to the 2008 financial crisis. The scandal highlighted issues with underregulation, risky lending practices, and lack of oversight in the housing and finance sectors during that period.