Investigations into the origins of the credit and housing crisis have revealed that it was a confluence of cheating.
AIG, the mega insurance company and hedge fund, bundled bad mortgage loans with good and wrapped the resulting loan package with a AAA safe credit paper of approval. Under pressure from the banks that securitized housing loans, ratings agencies developed an underwriting formula that would stamp these products as safe. Some mortgage brokers falsified credit applications for home loans or encouraged home buyers to do so. Home buyers fudged their income and expenses to buy houses that they could not afford.
Dan Ariely, a behavioral economist who wrote Predictably Irrational, reveals the results of several experiments on cheating in this video, beginning from about the 5 minute marker and ending at the 13 minute marker in the video.