5,000 Illegal Foreclosures On Military Families: Up Dated

(2 pm. – promoted by ek hornbeck)

Cross posted from The Stars Hollow Gazette

US lenders review military foreclosures

By Shahien Nasiripour in New York

Ten leading US lenders may have unlawfully foreclosed on the mortgages of nearly 5,000 active-duty members of the US military in recent years, according to data released by a federal regulator.

JPMorgan Chase and Bank of America this year reached legal settlements in which they agreed to pay damages to nearly 200 service members who claimed that their homes had been improperly seized.

Data released last week by the Treasury’s Office of the Comptroller of the Currency, which regulates national banks, shows that 10 lenders – including BofA, but not JPMorgan, which was not part of the study – are reviewing nearly 5,000 foreclosures of homes belonging to service members and their families to see if they complied with the law.

Dishonorably Discharged, with Pat Garofalo

Pat Garofalo reported this at Think Progress:

Back in April, JPMorgan Chase, which was not one of the 10 banks that the OCC examined, agreed to a $56 million settlement over allegations that it had overcharged members of the military on their mortgages. Chase Bank has even auctioned off the home of a military member the very day that he returned from Iraq. Two other mortgage servicers agreed in May to settle charges of improperly foreclosing on servicemembers.

Even without the banks illegally foreclosing, military members have been hard hit by the foreclosure crisis. Last year alone, 20,000 members of the military faced foreclosure, a 32 percent increase over 2008. The newly created Consumer Financial Protection Bureau is tasked with ensuring that military members are treated fairly by financial services companies – a job that is obviously necessary – but Republicans in Congress have, so far, refused to confirm a director for the agency, leaving it unable to fulfill all of its responsibilities.

Up Date: New York State Attorney General Eric Schneiderman has launched an investigation into military foreclosures under a NY State consumer protection law, the Martin Act, that gives him broad powers to investigate fraud.

Also, Congress is getting on the bandwagon, Sen. Jack Reed (D-RI), a member of the Senate Banking Committee, will be requesting hearings. From David Dayen at FDL:

It looks like even Congress is getting involved, or at least a few of them, because systematic illegal foreclosures on everyday people can be ignored, but systematic foreclosures on members of the military cannot. Jack Reed, a member of the Senate Banking Committee, will request a hearing on the matter. Brad Miller, who has actually been great on this issue and who sees it as a lever to open up a host of inquiries on foreclosure fraud, had a great statement yesterday:

   It is hard to see this as anything except a flagrant disregard for a law that has been on the books continuously since the First World War. The Servicemembers Civil Relief Act is very clear: if you’re in harm’s way in our nation’s military, you can devote your whole energy to our nation’s service without worrying what’s happening in a courthouse back home. And if you have a claim against someone in our military, you can wait until they get home and can defend themselves.

   The SCRA is not some obscure legal technicality that might just have escaped the attention of mortgage servicers. Those servicers are all affiliates of the biggest banks, but they’re huge and specialized. Servicing mortgages is all they do, and they really don’t have that many laws to keep up with. They have got to have known what the law required, and consciously decided that they could just ignore it, the same way they apparently decided it was okay to file false affidavits in legal proceedings.

   The continued failure to pursue criminal charges in the face of flagrant violations of the criminal law is destroying Americans’ faith in their government and democracy. In a democracy, no one is too big to prosecute.

Schneiderman is doing the job that we would expect Eric Holder to be doing. Just where is Mr. Holder? We know where the president is, campaigning.

1 comments

    • TMC on December 1, 2011 at 09:17
      Author

Comments have been disabled.