By David Dayen, a lapsed blogger, now a freelance writer based in Los Angeles, CA. Follow him on Twitter @ddayen
This morning the Government Accountability Office released their second report on the Independent Foreclosure Reviews.
Read more...As regular readers may recall, Promontory Financial Group was one of the huge winners from the joke on the public otherwise known as the Independent Foreclosure Review. The only accurate word in that label, it turns out, was “foreclosure”.
So how is Promontory using all its lucre? Buying up even more former regulators to further its reputation as a connected insider. Mary Shapiro had barely left the SEC when she was nominated for a board seat at General Electric, which despite its image as a manufacturer, has for over two decades had nearly half its revenues coming from financial services. And now Shapiro has been signed by Promontory to help arm-twist regulators not to do their job.
Read more...We have seen it for several years: foreclosure sales have become the hunting grounds for investors with two goals: hanging on to these homes until the Fed’s flood of money drives up their value, and renting them out. Thousands of smaller investors have piled into the game. And so have the giants. But now the second half of the equation is collapsing.
Read more...It’s clear the OCC is winging details it should have nailed down before settling.
Read more...Over the last two and a half years, Wells Fargo, like most of the major mortgage servicers, claimed that it had a “rigorous system” to insure that mortgage documents were accurate and complete. The reason this mattered was that there was significant evidence to the contrary. Foreclosure defense attorneys found repeatedly that, for securitized mortgages, the servicer or foreclosure mill attorney would present documents to the court that failed to show the borrower’s note (a promissory note) had been transferred properly to the trust. This mattered not only on a borrower level, but indicated that originators of the mortgage securitizations hadn’t bothered transferring the notes properly to the trusts that were to hold them. This raised the ugly specter of what was called “securitization fail,” that investors had been sold securities that they had been told were mortgage backed when they might in practice not be.
The robosiging scandal was merely the tip of the iceberg of mortgage and foreclosure problems that resulted from the failure to adhere to the requirements of well-settled state real estate law. The banks maintained that there was nothing wrong with mortgage ownership or with the records. All they had were occasional errors and some unfortunate corners-cutting with affidavits. If they merely re-executed all those robosigned documents, all would be well.
Wells Fargo’s own actions say the reverse.
Read more...The Wall Street Journal today stresses that a lot of Democratic congressmen are unhappy about the botched settlement process but are unlikely to do more than beef because the new Comptroller of the Currency, Tom Curry, was selected by Obama.
But the more people poke at the settlement, the more creepy crawlies emerge.
Read more...It’s really easy to have a fortress balance sheet if you can get other people to eat your losses
Read more...As a follow up to our series* on how Bank of America and its supposed independent consultant Promontory Financial Group, colluded to make a mockery of a process designed to provide compensation to borrowers who had suffered abuses in foreclosures during 2009 and 2010, we thought we would offer a few suggestions as to how to forestall future fiascoes of this sort.
Read more...Remember that big, ballyhooed mortgage settlement of early last year? The one where homeowners got $25 billion of relief (well actually only around $5 billion in cold cash, but why bother with pesky details?) The one made possible by Eric Schneiderman abandoning his fellow state attorneys general to grasp the brass ring of a do-just-about-nothing Residential Mortgage-Backed Task Force? The one that would make banks clean up their act and stop using robosigned documents and deal more fairly with borrowers?
Consent orders are seldom worth the paper they are printed on. The state/Federal settlement of early 2012 is no different.
Read more...By David Dayen, a lapsed blogger, now a freelance writer based in Los Angeles, CA. Follow him on Twitter @ddayen
Greetings, NC readers! Yves has been nice enough to open up her Internet home to me, and I intend to grab the opportunity from time to time. This offer turned fortuitous after I wrote a little piece from Salon on the “anniversary” of the securitization fraud task force, announced at last year’s State of the Union address. Well, Katrina vanden Heuvel, editor and publisher of The Nation, got very upset at my characterization of the task force
Read more...The OCC is bravely trying to spin the horrorshow of its botched foreclosure reviews as some sort of positive outcome. It is apparently now trying to present its dereliction of duty in figuring out how to compensate borrowers as no big deal.
Read more...I know a lot of readers miss Dave Dayen, who had a solid following at Firedoglake and among other things, covered the mortgage beat ably and energetically. He’s apparently been busy reporting, and just published a story in Washington Monthly on how the mortgage standards launched by the Consumer Financial Protection Bureau fall well short of what is necessary.
Read more...This post continues our discussion of the role of “independent” foreclosure review consultant Promontory Financial Group. Here we focus on what happened, or more important, didn’t happen in Promontory’s conduct of the reviews, and how that contrasts with the staggering fees the firm is widely believed to have earned.
Read more...This post continues our discussion of how Bank of America and its consultant, Promontory Financial Group, made concerted efforts to ignore and suppress evidence of harm to borrowers who asked for what was supposed to be an independent review of their foreclosure.
Read more...Wow, one of my big assumptions about mortgage putback cases has been turned on its ear, much to the detriment of Bank of America and JP Morgan. If you thought there were pitched legal battles on this front, a key ruling by Judge Jed Rakoff means you ain’t seen nothing yet.
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