Born on November 16, 1931 and raised on Manhattan’s Lower East Side, Herbert M. Sandler graduated from the City College of New York in 1951 and Columbia Law School in 1954. After completing his education, he worked for the Waterfront Commission of New York Harbor and as an attorney at a small law firm in lower Manhattan.
Marion Sandler was born Marion Osher in Biddeford, Maine, on October 17, 1990. She earned a BA from Wellesley College in 1952 and an MBA from New York University in 1958.
In 1963, two years after marrying, the couple moved to California and opened the Golden West Financial Corporation, a risk-averse residential mortgage portfolio lender that they would operate until 2006. With their new holding company, the Sandlers were able to secure bank loans plus additional funds from Marion’s family to purchase, for $3.8 million, the Oakland-based Golden West Savings and Loan, which had assets of $38 million.
In 1975 the Sandlers combined Golden West S&L with another California firm, World Savings, which had 107 offices and $1.8 billion in assets. Taking advantage of regulations passed in 1981, the Sandlers’ World Savings Bank (WSB) steadily grew, specializing in the first-of-their-kind adjustable rate mortgages that allowed borrowers to defer paying their interest. By 2000, the WSB — with 450 locations, and assets of $58 billion — had become the second-largest savings-and-loan in America. On July 19, 2001, Nancy Pelosi inducted the Sandlers into the Bay Area Business Hall of Fame for their “dedication to the people of the Bay Area.”
In 1988 the Sandlers established the Sandler Family Supporting Foundation (SFSF) to fund a wide variety of leftist groups and causes. For example, during its first 15 years of operation, SFSF gave tens of millions of dollars to the ACLU and Human Rights Watch. By 2000, the Sanders had become philanthropic allies of George Soros, with whom they funded MoveOn.org and helped to establish and finance (with $37,224,000 from 2004-15) the Center for American Progress, on whose board of directors Marion served. In 2004, along with Soros and Peter Lewis, the Sandlers created America Votes in order to bolster Democratic get-out-the-vote drives during that year’s election season. In 2006, the Sandlers spent $30 million to found and finance Pro Publica, an investigative journalism outfit. Mr. Sandler went on to serve as chairman of ProPublica until 2016, and his family foundation gave the organization approximately $27 million between 2009 and 2015.
The Sandlers also showered many millions of dollars on such entities as the Natural Resources Defense Council, Earthjustice, the Sierra Club Foundation, the Rainforest Action Network, the Center for Climate Strategies, the PICO National Network, the Center for Responsible Lending, the Pew Charitable Trusts, the Center on Budget and Policy Priorities, the American Constitution Society, Free Press, the Tides Foundation, Media Matters for America, and George Soros’s Open Society Institute.
Around 2005-06, the Sandlers became founding members of George Soros’s Democracy Alliance, a group of ultra-wealthy leftists aiming to fund the establishment of a permanent political infrastructure of think tanks, media outlets, and activist groups designed to push America ever farther to the political left.
In November 2007, The Los Angeles Times quoted Mr. Sandler stating: “I am deeply opposed to wealthy people who exploit the poor, powerful people who prey on the weak, and government representatives who betray the trust of the people they supposedly represent.” This, Sandler explained, was what motivated him to pursue his philanthropic endeavors: “It starts with outrage. You go a little crazy when power takes advantage of those without power. It could be political corruption….”
Notwithstanding their professed aversion to corruption, the Sandlers had close connections to the notoriously corrupt community organization ACORN and to the Center for Responsible Lending (CRL), an ACORN ally that championed the Community Reinvestment Act (CRA) and the proliferation of highly risky subprime mortgage loans before the financial meltdown of 2008. In 2002 the Sandlers co-founded CRL and gave it $20 million over the next six years. And from 2001-08, the Sandler Family Foundation also gave ACORN and its various front groups — particularly the American Institute for Social Justice and Project Vote — at least $7.7 million.
Ex-ACORN employees later reported that the Sandlers had paid ACORN to dispatch protesters to harass Wells Fargo Bank, a major competitor of the Sandlers’ Golden West, and publicly accuse it of engaging in predatory lending practices. As the Capital Research Center details:
“In 2003, ACORN published a report accusing two Wells Fargo units, Wells Fargo Financial and Wells Fargo Funding, of predatory lending and other unethical business practices. In New Mexico, ACORN filed 14 complaints against the bank, alleging unfair business practices. In 2004, ACORN initiated a nationwide class action lawsuit against the bank, accusing it of ‘a broad range of unfair and deceptive lending practices, including misleading borrowers about the real terms and conditions of their loans, bait-and-switch sales tactics, and routinely failing to inform borrowers with good credit that they [could] qualify for credit at significantly better rates and fees than those charged them by Wells.
“On the date the suit was filed, ACORN held a march and rally in Los Angeles involving 2,000 ACORN members. ‘ACORN will not allow Wells Fargo to continue to swindle and steal from our communities,’ said ACORN’s then-national president Maude Hurd. ‘We will fight until they stop their abusive loan practices, and the Wells stagecoach is no longer delivering misery to homeowners.’ Two weeks before, ACORN filed a separate class action lawsuit in Illinois, accusing the bank of ‘collecting fees on high rate loans in excess of what is permitted by state law.’
“In 2005, ACORN unveiled a study of the bank’s loans in 42 metropolitan areas that the group claimed showed ‘a huge racial and economic disparity between the company’s prime (less costly) mortgage lending and its higher-cost subprime lending.’ ACORN also demanded that the Federal Reserve Board remove the bank’s CEO, Richard Kovacevich, from its advisory council, ‘because of Wells Fargo’s discriminatory and predatory financial practices.’”
Further, onetime ACORN board member Marcel Reid has noted that during the Wells Fargo campaign, ACORN demonstrators got their marching orders from personnel affiliated with the Sandler-funded CRL.
In spite of their connections to the corrupt ACORN and CRL, the Sandlers, in contrast to their allies George Soros and Peter Lewis, were able to maintain a low public profile for many years. They suddenly made headlines in October 2006, however, when they sold their World Savings Bank for $24.3 billion to the Wachovia Corporation, in the process pocketing $2.4 billion and putting $1.4 billion into their foundation, thereby making it one of the thirty largest foundations in the America. At the time of the sale, the Sandlers’ World Savings Bank carried $122 billion in adjustable rate mortgages. The Capital Research Center explains the monumental significance of that statistic:
“Behind the scenes … World Savings Bank [starting in the 1980s] aggressively pushed an exotic form of mortgage called an option adjustable rate mortgage, or option ARM. World Savings gave it a cute name: ‘Pick-A-Pay.’ There was nothing cutesy, though, about the way it worked. The customer was given several alternatives for making a monthly mortgage payment. Ostensibly this gave homeowners more flexibility in handling their payments should they encounter money problems. In practice, however, Option ARMs lured borrowers into going deeper into debt. Some of the options offered payment amounts so low they didn’t cover the interest on the principal, and by allowing consumers to choose them, the mortgage holder encouraged borrowers to make regular monthly payments that actually put them deeper in debt, owing more and more to the bank with each passing month. Inevitably many borrowers did just that, and World Savings Bank’s portfolio soon swelled with ‘toxic’ loans.
“’This product is the most destructive financial weapon ever deployed against the American middle class,’ housing lawyer William Purdy told the New York Times…. Shortly after World Savings Bank was sold to Wachovia, the loans became a drain on the bank. In the first quarter of 2007 Wachovia reported losses of $2.3 billion. By the second quarter of 2008 it reported losses of $8.9 billion. Wachovia effectively ceased to exist by October 2008 when it was acquired by Wells Fargo in a forced government sale.”
This development, of course, brought more bad publicity to the Sandlers, as many analysts contended that the “soaring portfolio of World Savings” helped to sink Wachovia. Herb Sandler, however, defended his business practices: “I didn’t mislead anybody, and to the best of my knowledge, our company didn’t, though there may have been an isolated case here and there.” “If home prices hadn’t declined by 50 percent, nobody would be raising these questions,” he stated in 2008.
On October 4, 2008, Saturday Night Live aired a skit in which the Sandlers were depicted as predatory lenders. Under their names, SNL placed the caption “people who should be shot.” Compounding the Sandlers’ negative press was a Time magazine list that identified them as two of the “25 people to blame for the financial crisis.” The New York Times also labeled the Sandlers as “pariah[s]” — and on December 24, 2008, the Times reported that their mortgages were the “Typhoid Mary” of the housing crisis. Moreover, on February 15, 2009, CBS’s 60 minutes aired a segment that featured the World Savings Bank as one of the primary examples of how the mortgage industry had destroyed itself and unleashed an economic collapse on the United States.
On April 22, 2009, the Sandlers wrote a letter to New York Times executive editor Bill Keller, criticizing the paper’s news coverage of them. The Sandlers defended the adjustable rate mortgages that had defined their financial success, distinguishing between those which their bank had offered consumers and the kind that had caused so much economic disaster. While issuing some corrections, the Times defended its original reporting: “We still stand by our Golden West story and believe it was a very strong piece to pursue and that we framed it fairly.”
Marion Sandler died on June 1, 2012, after a long illness. Herb Sandler died seven years later, on June 5, 2019 in San Francisco.
Further Reading: “Self-Made Philanthropists” (NY Times Magazine, 3-9-2008); “Herbert M. Sandler” (HerbSandler.com); “Former Golden West CEO And Billionaire Marion Sandler Dead At 81” (Forbes.com, 6-4-2012); “Herb Sandler” (Keywiki.org).
No Shame on the Left: Herb and Marion Sandler Have Concealed Their Role in the Housing Crisis with Large Gifts to Left-Wing Causes
By The Capital Research Center
February 5, 2015
The Irresponsible Center for Responsible Lending
By Sean Higgins
The Education of Herb and Marion Sandler
By Jeff Horwitz
Once Trusted Mortgage Pioneers, Now Scrutinized
By Michael Moss and Geraldine Fabrikant
December 28, 2008