“Fannie’s internal review found no evidence that homeowners had been improperly placed in foreclosure, but it said that foreclosure attorneys working on Fannie’s behalf in Florida had “routinely made” false statements in court in an effort to more quickly process foreclosures, among other warnings”
Reports Fault Regulator of Fannie, Freddie
Regulators don’t have enough examiners for mortgage-finance giants Fannie Mae and Freddie Mac, and have struggled at times to develop risk controls for the companies, according to two reports to be released Friday by the inspector general of the Federal Housing Finance Agency.
One of the reports implied that better risk controls at Fannie Mae could have helped avoid potential foreclosure abuses that erupted into public view a year ago, forcing banks to slow down and revamp their mortgage-handling processes.
The inspector general reached that conclusion because it said Fannie missed deadlines set by its regulator, the FHFA, to implement an operational risk-management program. Those failures, it added, had potentially prevented the company from addressing problems identified in an internal Fannie review from 2006 on potential foreclosure abuses by law firms that handle foreclosures.
The FHFA disagreed with some of the inspector general’s findings and allegations.
The 2006 review was conducted by an outside law firm for Fannie after a shareholder raised concerns about the industry’s foreclosure-handling practices. That report’s findings were first reported by The Wall Street Journal in March.
Rest from the WSJ here..
The shareholder who raised concerns…
Our friend Nye Lavalle…
His 2004 REPORT ON PREDATORY LENDING & SERVICING PRACTICES & THEIR EFFECT ON CORPORATE
COMPLIANCE, CONDUCT, ETHICS & ACCOUNTING is below…