Demetrio M. Scopelliti

Homeownership symbolizes the American dream. The home we live in often represents how we choose to live our lives. As Winston Churchill once said, “We shape our dwellings, and afterwards our dwellings shape us.”

As the 2000s unfolded, economic growth and public policies designed to increase homeownership led to a housing boom. By 2006, the “housing bubble” began to burst. In late 2007, the economy fell into recession. The housingmarket continued to soften, people began to lose their jobs, and the banking industry was in crisis.

This Spotlight on Statistics looks at consumer expenditures on household items, employment in residential construction and housing-related industries, prices for household items and commodities, and injuries in occupations involved in building and maintaining our homes.

Preet Bharara, the prosecutor with a legendary record of convicting insider trading cases, says people should lay off Wall Street for the crisis

The Guardian-

Here’s something you don’t expect to hear from a man who made his reputation by jailing bankers and becoming the “scourge of Wall Street”: ask him if fraud existed during the mortgage crisis and his answer is “the evidence is not there.”

The words come from Preet Bharara, the US attorney for the southern district of New York, who prosecuted more Wall Streeters for insider trading than anyone who came before him. Worth magazine this week named Bharara at the top of its “100 Most Powerful People in Finance”. Bharara seems to like his high profile, and appears to be gunning for an even bigger one: he suggested that the new US attorney general of the United States should share all of the priorities of Bharara’s own office.

In boasting about his record of putting white-collar criminals in jail, Bharara repeated a common – but outdated – Obama Administration line, that the mortgage crisis was not fuelled by fraud.

“This is by reputation and track record the most aggressive office in white-collar crime in the country ever,” Bharara modestly told Worth, “and if we’re not bringing a certain kind of case, it’s because the evidence is not there. Pure and simple”.

[THE GUARDIAN]

Photograph: Seth Wenig/AP

I hope Elizabeth Warren gets involved…

Yahoo-

Many thousands of Americans who lost their homes in the housing bust, but have since begun to rebuild their finances, are suddenly facing a new foreclosure nightmare: debt collectors are chasing them down for the money they still owe by freezing their bank accounts, garnishing their wages and seizing their assets.

By now, banks have usually sold the houses. But the proceeds of those sales were often not enough to cover the amount of the loan, plus penalties, legal bills and fees. The two big government-controlled housing finance companies, Fannie Mae and Freddie Mac, as well as other mortgage players, are increasingly pressing borrowers to pay whatever they still owe on mortgages they defaulted on years ago.

Using a legal tool known as a “deficiency judgment,” lenders can ensure that borrowers are haunted by these zombie-like debts for years, and sometimes decades, to come. Before the housing bubble, banks often refrained from seeking deficiency judgments, which were seen as costly and an invitation for bad publicity. Some of the biggest banks still feel that way.

[YAHOO]

via- Lauren Tratar

Quotations from former Presidents, Senators, Economists, and highly respected people whose reputations and credibility have withstood the test of time provide the proof that illuminates THE TRUTH of what is happening in our country right now! Insiders at the Fed, the largest Banks and Wall Street are hijacking our country right before our eyes while we are engaged in petty bickering – exactly what they want us to do for it diverts our attention and thus dilutes our power. If you care about your country and this world, it is time to unite, learn what is REALLY happening and help to make a difference!

.

Why are we not surprised?

Oregon Live-

A Portland couple who received a loan modification and an apology from Nationstar Mortgage last year to settle their wrongful-foreclosure claims now say the company is trying to foreclose again even though they made all their monthly payments.

Michael and Judy McEldery of Northeast Portland found themselves facing foreclosure last year when they say Nationstar Mortgage — as a pretext to initiate the process — delayed applying one of their payments until after its due date.

The couple sought to block the foreclosure, and Michael McEldery, 67, followed up with claims the company had engaged in elder abuse, unlawful trade practices and breached its contract with him. The company agreed to apologize and modify the loan and bring it current to settle the case, said Michael Fuller, the McElderys’ attorney.

[OREGON LIVE]

Justia Opinion Summary

In 2004, Charles Adams conveyed a portion of his parcel of property to himself and his sister, Dorothy Adams, as joint tenants. Dorothy subsequently executed a promissory note to American Bankers Conduit and conveyed a mortgage on her interest in the property as security on the note. Dorothy defaulted on the loan in 2008. In 2012, U.S. Bank sought to place an equitable lien on Charles’s interest in the property. After a trial, the superior court entered a judgment on the merits in favor of Charles. The Supreme Court vacated the judgment and remanded for entry of dismissal, holding that because the complaint was not timely filed the action should have been dismissed pursuant to 14 Me. Rev. Stat. 752. Remanded.

MAINE SUPREME JUDICIAL COURT

U.S. BANK NATIONAL ASSOCIATION AS TRUSTEE FOR
BEAR STEARNS ASSET BACKED SECURITIES 2006-AC2

v.

CHARLES ADAMS et al.

Like it or not, this is absolutely true. He knew what was happening and he knew they were his biggest donors. They made him President.

Raw Story-

In an interview with Salon’s Thomas Frank, Massachusetts Senator Elizabeth Warren lashed out President Barack Obama and his administration for repeatedly protecting Wall Street’s interests over those of the American people.

She began, however, on a somewhat conciliatory note, saying that “Democrats have not done all that they should, but at least we’re out there fighting for the right things,” whereas “Mitch McConnell has announced that if he gets the majority in the Senate, his first objective is to repeal healthcare and his second is to roll back the financial reforms, and in particular to target the Consumer Financial Protection Bureau — the one agency that’s out there for American families, the one that has returned more than four billion dollars to families who got cheated by big financial institutions.”

“When I think about the president, for me, it’s about both halves,” Warren continued. “If Barack Obama had not been president of the United States we would not have a Consumer Financial Protection Bureau. Period. I’m completely convinced of that.”

[…]

And yet, she added, “[a]t the same time, he picked his economic team and when the going got tough, his economic team picked Wall Street.”

[RAW STORY]

IN THE SUPERIOR COURT OF
PENNSYLVANIA

HSBC BANK, NA AS TRUSTEE
Appellee

v.

AMY C. DONAGHY
Appellant

EXCERPT:
Accordingly, viewing the record in the light most favor able to the non- moving party and resolving all doubts as the existence of a genuine issue of material fact against the moving party, we conclude that the trial court erred in granting Appellee’s motion for summary judgment on its foreclosure complaint. There is a factual dispute as to whether Appellee complied with Sections 20 and 22 of the mortgage agreement.

Judgment reversed. Case remanded. Jurisdiction relinquished.

King5-

Robin Cox thought she was well on the way to rebuilding the south Seattle home where she raised seven children.

But a mysterious padlock on her front door changed everything.

The construction crew that was rebuilding her home after a devastating 2013 fire notified Cox that they couldn’t get in the house.
Cox soon learned that her mortgage servicer, Bank of America, had placed new locks on her doors.

“I was like, ‘What’s going on? What is this? Why is this here?'” said Cox.

[KING5]

YouTube-

It turns out the “robo-signing” of foreclosure affidavits is just the tip of the iceberg.

In what one judge called “robo-testimony,” falsely attested-to statements by bank document custodians have been submitted in courts around the country by banks trying to win judgments against delinquent credit card debtors.

Apparently, tens of millions of credit cards issued by banks have not been accompanied by good recordkeeping, either.

Chasing down delinquent borrowers in court requires original credit agreements and accurate payment histories to verify outstanding balances and claims.

As it turns out, banks aren’t providing them – either to the courts or to third-party debt collection companies that buy uncollected debts for pennies on the dollar.

As a result of these shoddy practices, judgments already granted to banks could be overturned and they could be sued by state attorney generals or pursued by the Consumer Financial Protection Bureau.

The same banks could even be potentially charged by the Justice Department under the Racketeer Influenced and Corrupt Organizations (RICO) Statutes for selling dubiously documented accounts to debt collection companies.

While some debtors will take comfort in what they read here, investors in banks may want to question how legal issues and regulatory investigations will impact their stocks.

Questionable bank documentation submitted to courts may be the reason JPMorgan Chase & Co. (NYSE: JPM) abruptly abandoned over 1,000 debt collection lawsuits in April 2011.

However, debtors whose pending cases were dismissed aren’t out of the woods yet. All of Chases’ suits were dismissed “without prejudice,” meaning Chase can re-file the cases in the future.
A Debt Collector’s Dirty Trick
The only relief long-delinquent borrowers have is the statute of limitations imposed by most states on debt collection.

Statutes of limitation, which are typically between two and 15 years, are by themselves no guarantee that debt collection agencies, which buy accounts from banks, won’t try to still collect.

Some debt collection companies entice delinquent borrowers who are beyond their statute of limitation requirements to make payments by offering to reduce the whole amount owed.

Their aim is to get the borrower to make even a single payment. It’s an old trick.

By paying anything on a debt that is past the statute of limitations, the debt is brought back to life again and the statute of limitations clock starts all over from the date of the new payment.

It’s why debtors are browbeaten and enticed to make payments through mailings, harassing calls, and “transfer of balance” offers for new credit cards, which requires old debts to be rolled into the new credit agreement.

The industry term for restarting the clock on old debts is called “re-aging.”

The Federal Trade Commission’s Bureau of Consumer Protection calls it illegal and abusive.

Last month the FTC and the Justice Department settled with one of the country’s biggest debt collection companies in a case with repercussions for the entire debt collection industry.

Asset Acceptance Capital Corp., which the FTC had charged with violations of federal law – including that it “failed to tell debtors they couldn’t be sued” when they tricked them into making payments to “re-age” old debts – was fined $2.5 million without admitting or denying wrongdoing.

The FTC, upon fining Asset Acceptance, announced additional enforcement actions are pending.

They are now joined by the Consumer Financial Protection Bureau, which has the authority to go after banks for abusive collection tactics.

“It was Graber, though, who quietly muscled the deals through behind the scenes.” Not Eric Holder…so what did Holder do? NADA.

Bloomberg-

Geoffrey Graber, the 41-year-old Justice Department attorney tasked with holding Wall Street accountable for the financial crisis, has a message for his prosecutors: Always be closing.

In the past year, Graber has won almost $37 billion in penalties from some of the world’s largest banks, a record haul for prosecutors. To colleagues, he compares his job to that of Blake, the notorious motivational speaker played by Alec Baldwin in David Mamet’s 1992 film Glengarry Glen Ross, who chastises real estate salesmen for failing to lock in deals.

“My role was to identify the most promising cases and accelerate those,” Graber said in an interview. “We’ve done our best to put a short fuse on this.”

[BLOOMBERG]

Photographer: Andrew Harrer/Bloomberg

Article began on the wrong foot. The DOJ has NEVER prepared for any rounds PERIOD.

Lets not forget.. AG Holder plans to leave right at the same time the Statue of Limitations ceased. Coincidence?

NY Times-

The Justice Department is preparing a fresh round of attacks on the world’s biggest banks, again questioning Wall Street’s role in a broad array of financial markets.

With evidence mounting that a number of foreign and American banks colluded to alter the price of foreign currencies, the largest and least regulated financial market, prosecutors are aiming to file charges against at least one bank by the end of the year, according to interviews with lawyers briefed on the matter. Ultimately, several banks are expected to plead guilty.

Interviews with more than a dozen lawyers who spoke on the condition of anonymity to discuss private negotiations open a window onto previously undisclosed aspects of an investigation that is unnerving Wall Street and the defense bar. While cases stemming from the financial crisis were aimed at institutions, prosecutors are planning to eventually indict individual bank employees over currency manipulation, using their instant messages as incriminating evidence.

[NEW YORK TIMES]

ANN FREIDAY, Appellant,
v.
ONEWEST BANK, FSB, Appellee.

Marc James Ayers of Bradley Arant Boult Cummings LLP, Birmingham, Alabama, for appellee.

STEVENSON, J.

Ann Freiday appeals from a final summary judgment of foreclosure. We find that the trial court erred in granting summary judgment because there remains a genuine issue of material fact as to whether OneWest complied with conditions precedent to foreclosure.

In June of 2012, OneWest filed a verified foreclosure complaint against Freiday. As a part of this complaint, OneWest stated that “[a]ll conditions precedent to the acceleration of the note and foreclosure of the mortgage have occurred or have been performed, waived or excused.” OneWest later filed a motion for summary judgment, with an affidavit of indebtedness attached to the motion. A copy of a default letter was also attached to the motion, but it is unclear whether this default letter was considered an exhibit to the affidavit of indebtedness or was simply a stand-alone document attached to the motion.

Freiday answered and raised numerous affirmative defenses, including a failure by OneWest to comply with conditions precedent. After a hearing on OneWest’s motion, the trial court entered final summary judgment in favor of OneWest.

The standard of review of an order granting summary judgment is de novo. Dominko v. Wells Fargo Bank, N.A., 102 So. 3d 696, 698 (Fla. 4th DCA 2012). “`Before a plaintiff is entitled to a summary judgment of foreclosure, the plaintiff must either factually refute the alleged affirmative defenses or establish that they are legally insufficient to defeat summary judgment.'” Frost v. Regions Bank, 15 So. 3d 905, 906 (Fla. 4th DCA 2009) (quoting Knight Energy Servs., Inc. v. Amoco Oil Co., 660 So. 2d 786, 788 (Fla. 4th DCA 1995)).

As previously noted by this court, “`[m]erely attaching documents which are not `sworn to or certified’ to a motion for summary judgment does not, without more, satisfy the procedural strictures inherent in Fla. R. Civ. P. 1.510(e).'” Finnegan v. Deutsche Bank Nat’l Trust Co., 96 So. 3d 1093, 1094 (Fla. 4th DCA 2012) (quoting Bifulco v. State Farm Mut. Auto. Ins. Co., 693 So. 2d 707, 709 (Fla. 4th DCA 1997)). In Finnegan, the bank filed a motion for summary judgment and later filed copies of unsworn default letters that had allegedly been sent to the homeowner. This court reversed the entry of summary judgment, and held that the trial court should not have considered the unsworn letters as evidence. It further observed that the affidavit filed by the bank in support of its motion failed to address whether the bank complied with conditions precedent. Id. at 1094; see Bryson v. Branch Banking & Trust Co., 75 So. 3d 783, 786 (Fla. 2d DCA 2011) (reversing summary judgment of foreclosure when the bank filed “unauthenticated copies of default letters,” and noting that the default letters were not “self-authenticating because extrinsic evidence to establish its truthfulness is still required”).

Similar to Finnegan and Bryson, the default letter attached to OneWest’s motion for summary judgment was not properly authenticated. Neither the motion for summary judgment nor the affidavit of indebtedness mentions anything about OneWest’s compliance with conditions precedent, and it is unclear from the affidavit whether the letter was considered a part of an exhibit that was attached to the affidavit. See Dominko, 102 So. 3d at 698-99 (“Just as the Second District concluded in Zervas, we find that Wells Fargo `did not establish that the record would have no genuine issue of material fact where it did not address the notice of acceleration in the motion for summary judgment or accompanying affidavits.'”) (quoting Zervas v. Wells Fargo Bank, N.A., 93 So. 3d 453, 455 (Fla. 2d DCA 2012)). Thus, because the default letter was not competent evidence, the trial court should not have relied on the default letter when considering OneWest’s motion for summary judgment.

Accordingly, since there remains a material issue of fact as to whether OneWest complied with Paragraphs 15 and 22 of the mortgage, we reverse and remand for further proceedings.

Reversed and Remanded.

WARNER and GERBER, JJ., concur.

Not final until disposition of timely filed motion for rehearing.

Medium-

One of the reasons that no one went to jail for the elite control fraud that caused the financial crisis is because of the pervasiveness of the criminality. You couldn’t send one guy to jail without having that guy very publicly rat out everyone else. To get to a high level on Wall Street you had to be dirty, like in a corrupt police department. No one trusts the one guy who won’t take bribes. Which brings us to Maurice “Hank” Greenberg, the former AIG CEO who is now, for lack of a better word, ratting everyone else out.

AIG, of course, is the massive insurance company which was bailed out by the government, with the Fed taking an 80% ownership stake in 2008. The AIG bailout was a strange deal, and it was renegotiated many times over the years. In a normal clean financial company resolution, AIG shareholders would have gotten wiped out. In the bailouts for Goldman, Morgan Stanley, and most of the big banks, shareholders got to keep their shares. AIG shareholders, by contrast, got to keep a little bit of what they had, a sort of split the baby in half deal. Hank Greenberg, as a shareholder, is extremely angry that he was treated this way. He thinks that he was not given equal treatment to Goldman shareholders, and in that he’s right. Most of us think that he should have been wiped out, and Goldman’s shareholders should have been wiped out too, so there’s little sympathy for this very rich man. But it’s utterly true, and everyone (even the most bank-friendly journalist Andrew Ross Sorkin) is acknowledging that it is true, that the government treated AIG shareholders differently. Greenberg is alleging, with good reason, that the motive here was quite sordid.

To understand the backstory, let’s take a quick look at AIG’s role in the housign bubble. Broadly speaking, AIG sells insurance, and one of its divisions (AIG Financial Products) sold a very specific type of insurance called a credit default swap. If you were a big bank and you owned a mortgage backed security, you could buy a credit default swap against the possibility that the security would default. Then, because you owned this insurance, whatever that mortgage-backed security might contain, be it good loans or the most toxic dreck imaginable, it was as good as gold. Default? No problem, AIG had you covered. The problem was that AIG covered everyone in the market, so while the company had a really big balance sheet, it ended up being liable for sums that were larger than the amount of capital it held. There were other serious problems at AIG, such as its securities lending operation, but those aren’t as relevant to the story. And yes, technically speaking, a credit default swap wasn’t legally considered a type of insurance, it was considered a ‘derivative’. But that was just a legal fiction so that insurance regulators, who would have forced AIG to hold enough money to back its bets, couldn’t touch the company. A credit default swap is insurance.

[MEDIUM]

Herald Tribune-

In many cases, owners lose their homes — and lifelong savings, while attorneys profit.

“At heart, these are confidence scams,” said Lawrance Evans, director of Financial Markets for the Government Accountability Office, which studies foreclosure rescue fraud for Congress. “These schemes more than ever are involving attorneys. Attorneys sort of bring that air of legitimacy, and unfortunately, they’re still duping folks.

“It all sounds good until the music stops.”

 [HERALD TRIBUNE]

National Mortgage News-

Credit availability is being stifled in part by a fear that lenders will be forced to buy back loans they sell into the secondary market, according to John Stumpf, the chief executive of Wells Fargo.

Speaking at a National Press Club event on Wednesday, Stumpf discussed a range of issues, including the economic outlook and the current strict regulatory environment.

But he spent a considerable chunk of his remarks focused on why housing has not picked up despite a prolonged period of low interest rates. In addition to citing factors including high student loan debt and a tough job market, Stumpf pointed to credit availability as the main culprit.

[NATIONAL MORTGAGE NEWS]

IN THE SUPREME COURT OF OHIO

SRMOF 2009-1
TRUST
Appellee

vs

SHARI LEWIS, et aL *
Appellant.

“Pay no attention to the man behind the curtain.”
– L. Frank Baum, The Wonderful Wizard of Oz

REPLY ARGUMENT
SRMOF offers the Court three different propositions of law which it believes will validate the Court of Appeals’s decision and lead to a conclusion that it had standing to sue because of its acquisition of an interest in the mortgage. Some of the arguments are premised on the “complexity” of modern mortgage financing. Others are based on a limited reading of the Mortgage itself. Still others find life in circumstances not before the Court. What it does not do, however, is examine the actual verbiage of the mortgage. Neither does it explore the underpinnings of the general rules on which its arguments are based. Once that is done, once the curtain is pulled back, the issues before the Court become much simpler to resolve.

FACTS REDUX:

Much of SRMOF’s argument relates to the rights it claims it acquired under the Assignment of Mortgage from Selene Finance, LP in August 2011. Because so much of SRMOF’s argument revolves around the contractual language of the Mortgage and the path of the Note, Lewis asks the Court to carefully review the record. Doing so will outline why the rights that were transferred by and to the various parties involved in Lewis’s loan did not confer standing on SRMOF until long after suit was filed.

Where’s The Note?

The complete path of the Note is not shown by the record. ‘The record reveals that at only two points of time was the location of the note positively known. Lewis issued the Note to First Union Mortgage Corporation on November 21, 2001.
Appellee Supp. S-4.

First Union apparently endorsed the Note in blank, making it bearer paper (the date of the endorsement is unknown). “There is nothing in the record to indicate where the Note went after the endorsement. SRMOF came into possession of the original Note sometime between August 14, 2012 and August 24, 2012. Notice To Withdrawal of Amended Motion for Summary Judgment Appellee Supp. S-66.

The lack of a Note did not, however, slow the wheels of the secondary mortgage market. On December 10, 2010, Wells Fargo Bank, N.A. executed a Lost Note Affidavit And Indemnification Agreement “in favor of Selene Finance.” Appellee Supp. S-50.

Contrary to SRMOF’s contention, the Lost Note Affidavit And Indemnification Agreement did not provide any information about the location of the Note since Lewis issued it. Neither was the document sufficient to grant to any person the right to enforce the Note.

The Mortgage Moves – A Lot.

Lewis executed the Mortgage on November 21, 2001. Appellee Supp. S- 7.

The Mortgage was granted to Mortgage Electronic Registration Systems, Inc., (MERS) “solely as nominee for Lender and Lender’s successors and assigns.” Id. “Lender” is defined as First Union Mortgage Corporation. Appellee Supp. S-8.’
The Mortgage was then assigned thrice.

A. Assignmerit No. 1- from MERS, “acting solely as nominee for First Union Mortgage Corporation” to “Wells Fargo.” (June 9, 2011). Appellee Supp. S-23.
This assignment was executed more than six months after Wells Fargo Bank, N.A. executed the Lost Note Affidavit And Indemnification Agreement.

B. Assignment No. 2 – from Wells Fargo Bank, N.A. to Selene Finance, LP (August 8, 2011) Appellee Supp. S-26

C. Assignment No. 3 – Selene Finance, LP to SRMOF 2009-1 ‘Trust (August 24, 2011). Appellee Supp. S-29.

1. AN INTEREST IN THE MORTGAGE IS NOT ENOUGH TO CONFER STANDING.

Lewis does not contest the general proposition that a mortgagee to whom specific rights are granted can sue for breach of the mortgage’s terms. This general principal, however, presumes two important facts. First, the mortgage must indeed grant rights to the mortgagee. In other words, the mortgagor’s duties must flow to the mortgagee, not to a third party for whom the mortgagee is acting. Second, the mortgagee whose rights have been violated must actually sue for a breach of its rights. Neither of those facts is present in this case.

[…]

Truth Out-

After learning that his home was in foreclosure in July 2013, James Cheeseman received an even more unpleasant surprise when he showed up in court the following January. He was told that his mortgage loan had been sold by JP Morgan Chase and purchased by a company he had never heard of before – LVS Financial.

Cheeseman had already applied for a loan modification from Chase and says he was still awaiting a response when the loan sale occurred – a move that he and his attorney argue violates New York State foreclosure laws. Cheeseman says that the new servicer, BSI Financial, then required him to fill out a whole new loan modification application. In mid-September, he learned that he had been denied.

Though he is asking the court for another shot at a modification, this curveball has caused considerable distress for Cheeseman, 47, and his mother Constance, 75, who have resided in the New York home that they co-own for five years.

“I was shocked; I thought that [the resale of bundles of bad loans] was over,” he says. “That’s what got the country into trouble in the 2008 [mortgage crisis]. But lo and behold, it’s still going on.”

[TRUTH-OUT]

What GAO Found

Through June 2014, the U.S. Department of the Treasury (Treasury) had disbursed about one-third of the $38.5 billion in Troubled Asset Relief Program (TARP) funds allocated to housing programs. However, the number of new borrowers added to the Home Affordable Modification Program (HAMP), the key component of the Making Home Affordable (MHA) program, began to decline in late 2013 after remaining relatively steady since 2012. Treasury has taken steps to assist more homeowners and also to address upcoming interest rate increases for borrowers already in the program (after 5 years, interest rates on modified loans may gradually increase to the market rate at the time of the modification). For example, Treasury has extended the HAMP deadline for a third time to at least December 31, 2016, and required servicers to inform borrowers about upcoming interest rate changes.

Treasury monitors HAMP denial and redefault rates, but its evaluation of data to help explain the reasons for differences among servicers is limited. GAO’s analysis of HAMP data found wide variation among servicers in reasons for denials of trial modifications. Some of these variations may be due to differences in servicer practices that would not necessarily be identified by Treasury’s compliance review process or analysis for reporting errors. GAO also identified wide variations in the probability of redefault even after controlling for differences in servicers’ loan, borrower, and property characteristics, using available data (see figure). Federal internal control standards state that analyzing relationships among data helps inform control and performance monitoring activities. Without more fully evaluating servicer data, Treasury may miss opportunities to identify and address servicer weaknesses and assist and retain as many borrowers as possible.

Probability of HAMP Redefault for Large Servicers and Others after Controlling for Certain Loan, Borrower, and Property Characteristics, as of March 2013

Finally, Treasury has implemented most of GAO’s past recommendations but has not fully implemented several that are intended to improve its oversight of the TARP-funded housing programs. For example, Treasury requires servicers to have controls in place for monitoring compliance with fair lending laws. But Treasury officials told us that they did not plan to assess these controls as GAO recommended because other federal agencies assess compliance with fair lending laws. Without such assessments, Treasury cannot determine whether servicers are complying with Treasury’s requirement. As stated previously, implementing this recommendation and others would improve Treasury’s oversight of TARP housing programs and help ensure that they assist and retain the greatest number of borrowers.

Why GAO Did This Study

Treasury introduced MHA in early 2009 and has allocated $38.5 billion in TARP funds to help struggling homeowners avoid potential foreclosure. The Emergency Economic Stabilization Act of 2008 requires GAO to report every 60 days on TARP activities. This 60-day report examines (1) the status of TARP-funded housing programs, (2) Treasury’s efforts to monitor and evaluate HAMP denial and redefault rates among servicers, and (3) the status of the implementation of GAO’s prior recommendations related to TARP-funded housing programs. To do this work, GAO reviewed program documentation, analyzed HAMP loan-level data, and interviewed knowledgeable Treasury officials.

What GAO Recommends

GAO recommends that Treasury conduct periodic evaluations to help explain differences among MHA servicers (1) in the reasons they gave for denying applications for HAMP trial modifications and (2) in HAMP loan modification redefault rates. Such evaluations would help inform compliance reviews of individual servicers and help identify any needed program policy changes. Treasury agreed to consider making changes to its analytical methods for evaluating data on denial and redefault rates among individual servicers.

For more information, contact Mathew Scirè at (202) 512-8678 or sciremj@gao.gov.

LA Times-

Given the government’s failure to bring criminal cases against bankers and other Wall Street figures for collapsing the U.S. economy in 2008, it’s been left to the little guy to strike back.

To be precise, one federal jury in Sacramento, which acquitted four allegedly fraudulent mortgage borrowers of criminal charges after hearing testimony that the executives at their banks pulled out all the stops to make fraudulent loans for their personal profit.

We’re a bit late to this story–the verdict was handed up at the end of August, Salon’s Thomas Frank had a good analysis of the case a few weeks ago. But because of its potential significance for mortgage fraud prosecutions going forward, and because it happened in the federal district known for its aggressiveness in pursuing borrowers for mortgage fraud, the case is worth a closer look.

[LA TIMES]

Image: Rich Pedroncelli / AP

Bill Moyers

Attorney General Eric Holder’s resignation last week reminds us of an infuriating fact: No banking executives have been criminally prosecuted for their role in causing the biggest financial disaster since the Great Depression.

“I blame Holder. I blame Timothy Geithner,” veteran bank regulator William K. Black tells Bill this week. “But they are fulfilling administration policies. The problem definitely comes from the top. And remember, Obama wouldn’t have been president but for the financial contribution of bankers.”

And the rub? While large banks have been penalized for their role in the housing meltdown, the costs of those fines will be largely borne by shareholders and taxpayers as the banks write off the fines as the cost of doing business. And by and large these top executives got to keep their massive bonuses and compensation, despite the fallout.

[BILL MOYERS]

image: Carolyn Kaster, The Associated Press

Bloomberg-

Ben S. Bernanke said the mortgage market is still so tight that he’s having a hard time refinancing his own home loan.

The former Federal Reserve chairman, speaking at a conference in Chicago, told moderator Mark Zandi of Moody’s Analytics Inc. — “just between the two of us” — that “I recently tried to refinance my mortgage and I was unsuccessful in doing so.”

When the audience laughed, Bernanke said, “I’m not making that up.”

[BLOOMBERG]

Image: Andrew Harrer/Bloomberg