FDIC Statement on Enforcement Orders Against Large Servicers Related to Foreclosure Practices

FDIC Statement on Enforcement Orders Against Large Servicers Related to Foreclosure Practices

April 13, 2011
Media Contact:
Andrew Gray (202) 898-7192
Email: angray@fdic.gov

The Federal Deposit Insurance Corporation (FDIC) today issued the following statement commenting on the enforcement orders against large servicers related to their foreclosure practices:

“Today, the three primary federal regulators of the nation’s 14 largest mortgage servicers published final enforcement orders against these institutions based on the findings of a review of their foreclosure policies and practices. While the FDIC is not the primary federal regulator for any of the largest mortgage servicers, the FDIC participated in this interagency horizontal review, at the invitation of the primary regulators, as the back-up regulator to protect the interests of the deposit insurance fund and to provide resources and support for this important review. The FDIC was also a signatory to one of the orders as the primary federal regulator of an insured depository whose loans were serviced by an affiliated servicer under the holding company. The effect of this order is to require the bank to ensure that its affiliated servicer takes corrective measures to fully address deficiencies identified in the interagency review.”

“The findings of the interagency review clearly show that the largest mortgage servicers had significant deficiencies in numerous aspects of their foreclosure processing. These deficiencies included the filing of inaccurate affidavits and other documentation in foreclosure proceedings (so-called “robo-signing”), inadequate oversight of attorneys and other third parties involved in the foreclosure process, inadequate staffing and training of employees, and the failure to effectively coordinate the loan modification and foreclosure process to ensure effective communications to borrowers seeking to avoid foreclosures. The interagency review was limited to the management of foreclosure practices and procedures, and was not, by its nature, a full scope review of the loan modification or other loss-mitigation efforts of these servicers. A thorough regulatory review of loss mitigation efforts is needed to ensure processes are sufficiently robust to prevent wrongful foreclosure actions and to ensure servicers have identified the extent to which individual homeowners have been harmed.”

“In its role as the primary federal regulator of a large number of state nonmember banks, which collectively service less than four percent of residential mortgages, the FDIC has been reviewing and conducting targeted exams to determine whether any of these institutions have engaged in the types of practices identified at the major servicers. To date, the review has not identified “robo-signing” or any other deficiencies that would warrant formal enforcement actions. The FDIC will continue to monitor these servicers, as well as the performance of institutions servicing loans through FDIC securitizations or resolution programs.”

“The enforcement orders incorporate some important requirements that, if fully implemented, will help prevent a recurrence of the serious problems with foreclosure processing revealed by the regulators’ review. In particular, the FDIC supports the inclusion in these orders of a single point of contact for homeowners to give homeowners a single person to work with throughout the stressful and often confusing loan modification and foreclosure process. Assigning a single point of contact will also provide for greater servicer employee accountability and, as such, will serve as an important quality control to ensure that modification and foreclosure activity are conducted in full compliance with applicable federal and state laws. Having a single point of contact will not prevent all foreclosures, but it will reduce the numbers of avoidable foreclosures as well as operational risks associated with foreclosure processes that violate the servicers’ legal obligations. It is essential that the implementation of the orders require specific, measurable actions of these servicers to address the deficiencies identified in the interagency review. The FDIC will continue to work with the primary federal regulators of these servicers to promote this result.”

“The enforcement orders issued today are important, but they are only a first step in setting out a framework for these large institutions to remedy these deficiencies and to identify homeowners harmed as a result of servicer errors. While today’s orders put these large servicers on a path to improving their management of the foreclosure process, they do not purport to fully identify and remedy past errors in mortgage-servicing operations of large institutions. Much work remains to ensure that the servicing process functions effectively, efficiently, and fairly going forward. Importantly, these enforcement orders do not contain monetary remedial measures. There is evidence that some level of wrongful foreclosures has occurred. It is important that servicers identify any harmed homeowners and provide appropriate remedies. This is essential to managing litigation and reputation risk, as well as fairness to borrowers. In addition, the FDIC continues to fully support the separate federal and state collaboration between the State Attorneys General and federal regulators led by the U.S. Department of Justice. The enforcement orders announced today complement, rather than preempt or impede, this ongoing collaboration.”

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16 Responses to “FDIC Statement on Enforcement Orders Against Large Servicers Related to Foreclosure Practices”
  1. Jason Werner says:

    Yeah, and it’s their member banks committing those crimes.

  2. lisamarie says:

    You know I’m sitting here wracking my brain and wondering is there more of them or more of us. Theres more of us. We need to WAR with these bastards!

  3. l vent says:

    The World Bank announced today rising food prices are going to cause more worldwide impoverishment.. They are the bastards that caused it. Sounds like another threat from the NEW WORLD ORDER. Sounds like maybe they are the ones who are starving because their evil plans suck. After all what did they think, they could get blood from an orange? Dummies. They are the ones that made their own well run dry. Good for the greedy bastards.

  4. Peggy Johnson says:

    So what is this? Mr. Big Pimp Bankster is off the hook? — Then every house in America foreclosed by the pimp’s use of phony documents is O.K.? SOUNDS TO ME LIKE WHORE HO– USES RATHER THAN FORECLOSED HO– USEs EXIST under the control of the pimp bankters to keep fucking us around. I am not a Whore are you? Then don’t insult my dignity nor intelligence. The last time I checked, fucking in public was illegal — obviously not when it comes to the pimp banksters — They get to do it to us all day every day while any and everybody stands around watching. Hmmm – Is the country being run by freaks? Hmmm – However without the pimp’s whore houses, who can then be legally fucked – So I say to every homeowner who has been raped by these theives, liars, and pimps. lets all have a huge orgy together and – Burn Baby Burn! AND START A REAL REVOLUTION THE OLD FASHIONED AMERICAN TEA PARTY WAY! YEAH, FUCK YOU BACK MR. PIMP BANKSTER!!!!! — HAVE A SIP OF YOUR OWN BREW YOU BASTARDS!

  5. PJDJ01 says:

    I get the impression that if Sheila Bair (FDIC) had her own way, she would not have signed this consent order. Rather it is Treasury Secretary Timothy Geithner (Mr. “I make up whatever rules I want”) that got Acting Comptroller of the Currency John Walsh to lead this whitewash, readily supported by Chairman Bernanke at the Fed. Sheila Bair signed on because she is an Obama Team Player who happened to loose out in the behind close door talks. As for Obama, he can just wash his hands of it.

    The shame is that Geithner truly believes the economic pain of dealing with moral misdeeds and legal fraud of the mortgage industry would be too much for the economy to withstand. While his values are shared by many, I just don’t believe that they are the values on which the country was built.

  6. boots says:

    blame this to all loan servicer that hired incompetent attorneys who just want to earned easy money without overseeing the documents that were filed in order to foreclose. anyway, these loan servicer and attorneys knew about this fabricated and fraudulent documents why do they need have to over see it?

    it was all fabricated any way so why bother?
    these foreclosure attorneys and their law firm must pay for allowing themselves to be used by loan servicer and banks to do do their fraudulent activities.

  7. Kate Johansson says:

    These deficiencies included the filing of inaccurate affidavits and other documentation in foreclosure proceedings (so-called “robo-signing”)

    Filing an “inaccurate” affidavit? I thought they were FRAUDULENT affidavits. WTF? Why do they keep sugar coating and making it all nicey nice? “So-called” “robo-signing?” Why is it “So called?” Why is it not just plain forgery and fraud?

  8. Why hasn’t anyone from MERS signed this agreement???
    Racine WI

  9. lisamarie says:

    Who would have ever believed our great country would stoop to this? How low will we go?

  10. J A says:

    I’m so glad Mr Gray included his email address at the top of this report. In order to help him see that there has been at least one instance of robosigning (but we all know there are millions), I will be emailing him shortly with a copy of what I have sent to the Florida attorney general’s office. I can’t wait to show him the hard cold evidence of an LPS “vice president” scrawling her name on the last piece of paper that truly stole my home from me after several months of fraud — the Warranty Deed constructed by FDLG’s inhouse title company — as though she were the “vice president” of my mortgage lender, with no official notarization of the document and no proper notary stamp with commission number.

    On another note, I honestly think the only ones who can hope to get any financial restitution will be the ones who can prove the fraud in their loan docs and foreclosure file. We all know that none of these govt entities are going to be kind enough to find all the people who have lost their homes due to fraud. It is up to us to be the squeaky wheel and to send them the proof in our own situation.

    If you’ve already lost your home like I have, I hope you have copies of all your paperwork because I think you’ll need it.

  11. l vent says:

    This is just some more FED speak for here is some more lying bullshit to try and cover up for all of the other fraudulent PONZI SCHEME bullshit.. The banks know the truth is our homes are paid for and have been since the closing. We were all just part of the PONZI SCHEME. These loans never existed which is proven way back in the Origination Fraud. RESCIND OUR FAKE MORTGAGE LOANS, GIVE THE STOLEN HOMES AND STOLEN WEALTH BACK TO THE PEOPLE. This evil plan is a complete failure. No more distractions, we know all about those ploys. Do not insult our intelligence. We The People owe no allegiance and we never will, to the UN/NEW WORLD ORDER. THIS IS THE UNITED STATES OF AMERICA and always will be. Our U.S. CONSTITUTION OVERULES THE FOREIGNERS AND THERE ARE LAWS THAT WERE PUT IN PLACE BY OUR FOREFATHERS THAT PROTECT OUR PROPERTY RIGHTS FROM THIEVES AND CRIMINALS WHO WANT TO STEAL OUR LAND THAT THEY DO NOT OWN. GOD BLESS AMERICA. DEATH TO THE MANIACAL, DIABOLICAL TYRANNY AND THE OPPRESSORS OF OUR AMERICAN FREEDOM. WE WILL OVERCOME.

  12. Katheryn says:

    What a friggin joke…….so forged affidavits, fraud, collusion with foreclosure mills are just a few of their “inaccurate” business procedures?????????????????????????????????????????????????????

    In a nutshell…they will have one person to whom we will deal with as they continue their theivery. It is getting to the time that we need real life “Robin Hoods”. Sadly, it seems that that is what it is coming down to. What’s good for the goose is good for the gander.

  13. l vent says:

    They better hurry up and chang the definition of the word DEFICIENCY in the dictionary to deficient(di-fish’ent) adj.: to decieve by covering up a pernicious crime, the defiliing and defrauding of large masses of people, victimizing a victim.

  14. pamelag says:

    Inaccurate affadavits! LIARS THIEVES. i am not surprised with the foxes in charge of the chickens. i am horrified

    • pamelag says:

      i pray for all who visit this website who are losing their homes thru the fraud. i am thankful that you ‘get it ‘because it is truly unbelievable. GOD BLESS AMERICA

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