Apparently, $26 billion in fines and penalties and massive negative publicity was not quite enough to motivate four of the five banks involved in the state attorneys general foreclosure fraud settlement to actually change their ways. At least, that is the conclusion of a recently-published report authored by former North Carolina banking commissioner Joseph Smith. “It’s better than it was [but] it’s not as good as it needs to be,” said Smith, revealing that Wells Fargo, JPMorgan Chase, Bank of America, and CitiMortgage all reported failures in meeting servicing settlement parameters. Bank of America and Chase reported two failures each related to response times, while CitiMortgage and Wells Fargo reported one failure each related to document collection timeline compliance.
These failures certainly correspond with anecdotal reports fromBEIL readers, who have reported that their lenders have not been noticeably easier to work with since the settlement last February. “Timeliness is important to borrowers and to the people who advise them,” said Smith, adding that the four lenders will have a chance to correct their violations before they face millions of dollars in fines. Late in May, homeowners gathered at the Department of Justice to protest “the failed execution of various weakly-constructed legal settlements” involving foreclosure fraud, saying that “banks have been slow to fulfill the meager direct payments provisions of the settlements [while] they’ve spent much more heavily to get properties empty and ready for resale”. The protest culminated in the arrest of multiple homeowners after they moved past a police barricade and attempted to establish a sit-in at the Justice building in Washington D.C.
by Carole VanSickle