Courtesy of Pam Martens.
Thomas Curry, Comptroller of the Currency
The past week has delivered revelation after revelation suggesting that the foreclosure frauds perpetrated against the American homeowner by the too-big-to-fail (or prosecute) banks, have been deviously matched with a corrupted settlement that has members of Senate hearings shaking their heads in astonishment. Yesterday brought the latest example of Federal bank regulators serving as lapdogs of their charges.
The Senate Banking Committee’s Subcommittee on Housing, Transportation and Community Development held a hearing titled: “Helping Homeowners Harmed by Foreclosures: Ensuring Accountability and Transparency in Foreclosure Reviews, Part II.” Senator Merkley delivered the fireworks of the session.
Early this year, when the Office of the Comptroller of the Currency (OCC) and Federal Reserve Board (Fed) announced that they were abruptly halting the Independent Foreclosure Reviews they had ordered 13 banks and mortgage servicers to have conducted by independent consultants, the party line was that it was to bring more rapid restitution funds into the hands of potential victims of foreclosure abuse.
The settlement was to consist of $3.6 billion in cash being paid directly to more than 4 million aggrieved borrowers with another $5.7 billion in soft dollar assistance such as loan modifications, principal reduction and forgiveness of deficiency judgments. Yesterday’s bombshell, that the $5.7 billion may only amount to a paltry $12 million, was captured in this exchange at the hearing between Senator Jeff Merkley and Deborah Goldberg, Special Project Director of the National Fair Housing Alliance:
Senator Merkley: “In your testimony Ms. Goldberg, on page 10, you note that ‘on a loan with an unpaid balance of $500,000, a loan modification that provides any amount of principal reduction – be that $1,000, $10,000, or $100,000 – will yield $500,000 worth of credit for the servicer.’ It’s hard for anyone apart from this process to truly believe that if you do a $1,000 reduction you get $500,000 credit. Yet, are you saying absolutely that’s the way it works?”
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