Reps. Conyers, Gutierrez, Capuano and Sens. Franken, Menendez Release GAO Report Investigating Foreclosure “Robo-signing”

Legislators Push for Nat’l Standards to Avoid Unfair Treatment and Wrongful Foreclosure on Homeowners

Thursday, May 5, 2011

A GAO report released today by U.S. Sens. Al Franken (D-Minn.) and Robert Menendez (D-N.J.), and Reps. John Conyers (D-Mich.), Luis V. Gutierrez (D-Ill.), and Mike Capuano (D-Mass.) confirmed reports that mortgage servicers had been fraudulently signing or notarizing affidavits allowing the completion of foreclosures without any personal knowledge of the cases, a process more commonly referred to as “robo-signing.” The legislators commissioned the report, entitled Mortgage Foreclosures: Documentation Problems Reveal Need for Ongoing Regulatory Oversight, to investigate news accounts that homeowners were being improperly foreclosed on.  In an effort to prevent future wrongdoings by mortgage servicers, the legislators today pressed banking regulators to implement safeguards recommended by the report that would ensure homeowners do not wrongfully lose their homes.

“We write today to urge you to develop a coordinated plan to ensure comprehensive oversight of federally regulated mortgage servicers and to reiterate our calls for national servicing standards that specifically address the foreclosure process,” the legislators wrote in a letter to banking regulators. “We have seen countless examples of servicers giving borrowers the run-around and continuing the foreclosure process when a loan modification has already been obtained.  Perhaps the most egregious cases of servicer wrongdoing have been violations of the Servicemembers Civil Relief Act by wrongly foreclosing on active-duty servicemembers.  Correcting these problems and ensuring they do not reoccur should be a priority for all of your agencies.”

The GAO report concluded that:

  • Despite various federal agencies’ having the authority to oversee mortgage servicers, past oversight of mortgage servicers’ foreclosure activities has been limited and fragmented;
  • It remains unclear how regulators and the new Consumer Financial Protection Bureau will share the responsibility of overseeing servicers, continuing the potential for poor and inconsistent oversight; and
  • National standards for mortgage servicers that address expectations for the foreclosure process could improve the ways servicers do business.

GAO recommends that banking regulators and the Consumer Financial Protection Bureau:

  • Develop plans for overseeing mortgage servicers; and
  • Include foreclosure practices in any servicing standards that are developed.

The letter from the legislators to Ben S. Bernanke, Chairman of the Board of Governors of the Federal Reserve System; John G. Walsh, Acting Comptroller of the Currency Office of the Comptroller of the Currency; Sheila C. Bair, Chairman of the Federal Deposit Insurance Corporation; John E. Bowman, Acting Director of the Office of Thrift Supervision, and Elizabeth Warren, Special Advisor for the Consumer Financial Protection Bureau can be read here.

The GAO’s full report can be found here.


10 Responses to “Reps. Conyers, Gutierrez, Capuano and Sens. Franken, Menendez Release GAO Report Investigating Foreclosure “Robo-signing””
  1. AliceN.Wunderland says:

    A single day of foreclosures equals a year of problems. Probably more like an hour equals a year. Keep letting it go Regulators, you ain’t see nothin yet.

  2. angry & NOT TAKING IT says:

    GAO recommends that banking regulators and the Consumer Financial Protection Bureau:
    Develop plans for overseeing mortgage servicers; and
    Include foreclosure practices in any servicing standards that are developed.

    i have a better idea . eliminate the mortgage servicers altogether .. problem solved.
    there are no payments due , this was a CONtinuation of the original [sin] [ the lie] mortgage note…. fukem

  3. indio007 says:

    This report is very unimpressive. They could have simply said “We don’t know anything yet”. Another gov’t entity sticks it’s head in the sand….

  4. l vent says:

    It is alot worse than they are revealing here. The entire mortgage industry was built on a house of cards and that house is collapsing. Dylan Ratigan reported today that the NFL lockout has alot to do with this very Mortgage Fraud Based, Ponzi Scheme Heist. This Ponzi Scheme was and is so extensive it is almost hard to comprehend its vast scope, The true magnitude of this Ponzi Scheme if it could be measured would no doubt be off of the richter scale.

    • anthony says:

      that is why NOONE is investigating into it in Florida it is the worst David J Stern caused two
      deaths one his Personal Assistant has a massive heart attack I WONDER WHYand he layedoff an
      employee of 14 years that needed Health Insurance because he had CANCER when the guy got laid off without notice two days later he died Stern just drops his files off at the courts and said I wuit how the hell do Attorneys get away with this if no one invesitigates this we need to protest this country is playing by its own rule everyone is involved Sterns employees worked from their houses and made up a time line of when the foreclosures were going through the process they were taught to lie if anyone took those timelines and deposed the employees that were doing them by lie detector the WHOLE picture would change the first week of the month these reports were sent to Wells Fargo and they were all made up why isn’t the government deposing these people with lie detectors ? If it were you and I we would be locked up DavidStern should have been Bin Laden’s human shield why go after bin laden when we have our own bin laden in
      South Florida

      • Anthony .. could you give us a few specific examples that we can verify through court records? That is, if Stern said something was happening timeline-wise to the banks, and was doing something different in real life, we can check the real timelines from our database of court records and say “yep banks .. you’ve been had; here is a count of the Stern activity and here’s the cases that prove it.” But we can’t do that unless we know what we’re looking for.

      • l vent says:

        Oh yeah, there are many bin ladens. They are all financial terrorists but terrorists just the same and they have killed people alot more insidioiusly, forced people to commit suicide, and even kill each other and injured alot more people than bin laden ever did. When people lose everyting sometimes they lose it. They have financially killed millions by stealing their homes and life savings and it was intentional and meant to cause permanent harm to all except those who were in on or are still committing the GIANT PONZI SCHEME SWINDLE AND HEIST, the top 1% and their minions.. Stern should have been locked up by now, you are right. Could there be any more evidence on this piece of s—? I thought there were sworn employee depositions against him and his firm. I think that dog Stern, will have his day soon.

      • anthony says:

        who can I contact in the government about this I told the AG and she did not do anything
        why didn’t she do anything I called the AG since last Oct and they do not do anything I know personally the ones that did it at Stern and I would like to speak to someone who is going to do something about itin the government or a large company Stern really did a number on a lot of us
        no one is going against him everyone said he is going to get his I just do not understand they are moving in on Marshall Watson and Diaz why isn’t Stern being mentioned anymore he left his files at the court his files are all messed up half were in abandoned desks and half were fudged
        yet he is still in his office and no one is bringing him to justice I would rather to talk to a government official regarding this and none seems to want to help

    • AliceN.Wunderland says:

      I agree, I vent, it tipped the richter scale years ago! They broke humpty dumpty and then they scrambled him and now they think they can put him back together again…do they have clue what they have done….I really don’t think they do.. and they are our brainiacs! And their homes have clouded titles too. O>M>G

      • l vent says:

        Alice, I think they are now, finally being forced to realize what they have done because millions are now fighting back and saying we know who did this to all of us. It is about time.

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