Grrr...'Whistleblower Lawsuits Against Banks Extinguished in Foreclosure Fraud Settlement' - FDL

[WillyT]

Whistleblower Lawsuits Against Banks Extinguished in Foreclosure Fraud Settlement
By: David Dayen - FDL
Sunday March 11, 2012 11:47 am

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I think my disgust over federal housing policy is just about complete. As you know, we’re still waiting for the actual terms of the foreclosure fraud settlement, more than one month after the announcement. But more information has dribbled out, not much of it to the good. Michael Hiltzik rounded up some of the more troubling issues. He mentions that OCC penalties will get folded into the settlement, basically charging $0 for their violations. The Federal Reserve did the same thing. He mentions the Ted Gayer study showing that only 500,000 borrowers will even be eligible for the principal reduction in the settlement, half of what HUD and other regulators promised. And he adds that the Treasury Department restored all HAMP incentive payments for servicers who failed to meet their obligations under the programs. As Hiltzik writes, “If the banks had shown as much forbearance toward their struggling borrowers as these three agencies have shown toward the banks, the foreclosure settlement wouldn’t have been necessary in the first place.”

But it gets worse. Remember those whistleblower lawsuits announced last week, alleged fraud in how Bank of America abused HAMP? iWatch News expanded on those reports, http://www.iwatchnews.org/2012/03/09/8359/new-whistleblower-cases-allege-continued-bank-fraud showing the different strategies BofA used to delay and deny loan modification claims for eligible borrowers:

The suit claims Bank of America:

Told borrowers and regulators that a complaint was “under review” while internally classifying the files as incomplete.

Parked cases with terminated or vacationing employees and sent payments to a “partial account” instead of crediting them to the loan, artificially inducing or prolonging a delinquent status.

Tried to persuade borrowers that did qualify for HAMP to take a proprietary loan that came with much less favorable terms, a violation of the bank’s agreement with the government when it took the bailout money.

<And...>

Well, guess what. The whistleblower suits were folded into the settlement, http://www.housingwire.com/article/ag-settlement-clears-bofa-hamp-lawsuit which is why they were recently unsealed:

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Much More: http://news.firedoglake.com/2012/03/11/whistleblower-lawsuits-against-banks-extinguished-in-foreclosure-fraud-settlement/

[woo me with science]

1. K&R Wake up America. The assaults continue on a daily basis.

The assaults on us are now systematic, sustained, and bipartisan.

Occupy. It has never been more important.

[dixiegrrrrl]

3. Yes, indeed.

"If there’s anything approaching accountability in the Obama Administration’s actions against the banks, I’m not seeing it."

Actions, not words, remember?

[saras]

2. I kind of miss the sixties left bombing a bank a day for a year...

..after courteously asking the actual humans to leave so as to not get hurt...

but I miss a lot of things about that era, and it's not coming back.