usan Sandler, the daughter of billionaire banking giants Herb and Marion Sandler, announced Monday that she is investing $200 million in “racial justice groups” as part of an effort to build a liberal infrastructure in states “undergoing rapid demographic change” such as Texas, Florida, and Georgia. The move from Sandler, a longtime donor to Democratic candidates and groups, is the start of a transition away from the short-term world of supporting campaigns to a long-term effort at building power, according to the Times.
The source of Sandler’s cash injection is her parents’ subprime mortgage company, Golden West Financial Corp., which was sold to Wachovia Bank in 2006 for a reported $25 billion. The couple built its fortune by offering millions of adjustable-rate mortgage loans to individuals, many of whom couldn’t afford them and eventually defaulted on their homes.
While the Sandlers came away with billions of dollars, many blame the loans they offered for causing the burst of the U.S. housing bubble and resulting financial crisis of 2007. The defaulted loans cost Wachovia billions of dollars, forcing it to merge with Wells Fargo, which eventually agreed to pay a $50 million settlement to borrowers who were misled by the Sandlers.