L.A. suit calls Deutsche Bank a slumlord

Officials charge world’s fourth-largest bank with letting foreclosed properties lapse into disrepair. Bank officials say loan servicers are to blame.

Los Angeles prosecutors are calling Deutsche Bank one of the city’s largest slumlords, accusing it of allowing hundreds of properties it owns to fall into disrepair and breed crime.

The Los Angeles city attorney’s office filed a civil lawsuit Wednesday against the world’s fourth-largest bank, seeking hundreds of millions of dollars in penalties and restitution and an injunction forcing it to clean up its foreclosed properties in Los Angeles.

The Frankfurt, Germany-based bank has foreclosed on more than 2,000 homes over the last four years in neighborhoods across the city, according to the suit — many concentrated in the northeast San Fernando Valley, northeast Los Angeles and South Los Angeles.

Los Angeles officials say the bank has been a dreadful landlord and neighbor. Prosecutors say that during a yearlong investigation, they found evidence that Deutsche Bank had illegally evicted some tenants, let others live in squalor and allowed hundreds of unoccupied properties to turn into graffiti-scarred dens for squatters, gang members and other criminals.

Deutsche Bank response…

“As we have repeatedly advised the Los Angeles city attorney’s office, loan servicers, and not Deutsche Bank as trustee, are contractually responsible for both the maintenance of foreclosed properties and any actions taken with respect to tenants of foreclosed properties.”

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