Tags: Financial Overhaul

Regulators Balk at Demands for Foreclosure Reports

Thursday, 21 Jul 2011 12:54 PM

Banking regulators refused to commit to releasing details of their investigations into illegal foreclosure practices by the nation's largest banks.

Appearing before a Senate panel Thursday, Federal Reserve Chairman Ben Bernanke and Acting Comptroller of the Currency John Walsh said they had not decided whether to release reports on illegal practices by individual banks

Sen. Robert Menendez, D-N.J, had pressed them to release the reports, banks' individual action plans and agreements with the consultants that investigated the banks. Menendez cited an AP report this week that said banks are continuing to foreclose without doing the necessary paperwork, eight months after they had promised to stop.

"We will have to evaluate the individual documents and see if there is anything that would be of a confidential, supervisory nature," Walsh said, adding that his agency will release "some information."

Bernanke said the Fed plans to release a report that "will explain what the findings were and what the proposals were and what the reactions were." But he said he must consult with his legal team before releasing any information about individual banks.

Citing a legal opinion by his staff, Menendez said the regulators are permitted to release the information if doing so was in the public's best interest.

"It is not acceptable to violate the law, and it is not acceptable to do robo-signings," Menendez said.

County officials in at least three states say they have received thousands of mortgage documents with questionable signatures since last fall, suggesting that the practices, known collectively as "robo-signing," remain widespread in the industry, the AP reported Monday.

Last fall, the nation's largest banks and mortgage lenders, including JPMorgan Chase, Wells Fargo, Bank of America and an arm of Goldman Sachs, suspended foreclosures while they investigated how corners were cut to keep pace with the crush of foreclosure paperwork.

Since then, suspect paperwork has been filed not only with foreclosures, but also with new purchases and refinancings. Critics there is a systemic problem with the paperwork involved in home mortgages and titles. They say banks and mortgage processors haven't acted aggressively enough to put an end to widespread document fraud in the mortgage industry.

Bernanke and Walsh were testifying before a hearing to mark the one-year anniversary of a sweeping overhaul of the rules governing the financial system.

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Banking regulators refused to commit to releasing details of their investigations into illegal foreclosure practices by the nation's largest banks.Appearing before a Senate panel Thursday, Federal Reserve Chairman Ben Bernanke and Acting Comptroller of the Currency John...
Financial Overhaul
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2011-54-21
Thursday, 21 Jul 2011 12:54 PM
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