Banks fined for al­leged fore­clo­sure abuse

The Washington Times Daily - - Politics -

The Fed­eral Re­serve said Mon­day that it plans to fine eight ad­di­tional U.S. bank hold­ing com­pa­nies for im­prop­erly fore­clos­ing on home­own­ers.

The fi­nan­cial firms Ever­bank, Gold­man Sachs Group, HSBC Hold­ings PLC, PNC Fi­nan­cial Ser­vices Group, Metlife, Onewest Bank, SunTrust Banks and U.S. Ban­corp were not part of last month’s set­tle­ment over al­leged fore­clo­sure abuses.

Suzanne G. Kil­lian, a se­nior as­so­ci­ate di­rec­tor at the Fed­eral Re­serve, called the fines “ap­pro­pri­ate” dur­ing a con­gres­sional hear­ing in Brook­lyn, N.Y.

Ms. Kil­lian of­fered few de­tails about the size of the fines or when they will be levied.

The na­tion’s five big­gest lenders Bank of Amer­ica, Wells Fargo, Jpmor­gan Chase, Cit­i­group and Ally Fi­nan­cial last month agreed to a $25 bil­lion set­tle­ment with state and fed­eral gov­ern­ment agen­cies last month af­ter a 16month probe.

As part of that set­tle­ment, the five banks agreed to re­duce mort­gages for about 1 mil­lion home­own­ers.

They also will pay into a fund that will send $2,000 to 750,000 home­own­ers who were im­prop­erly fore­closed upon.

Sep­a­rately, gov­ern­ment reg­u­la­tors last April or­dered 14 mort­gage lenders and ser­vicers to re­im­burse home­own­ers who were im­prop­erly fore­closed upon.

Since then, let­ters have been sent to 4.3 mil­lion bor­row­ers who were at risk of fore­clo­sure dur­ing 2009 and 2010.

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