Department of Justice
Office of Public Affairs
FOR IMMEDIATE RELEASE
Thursday, November 10, 2011
Department of Justice Announces Compensation for Servicemembers as Part of Settlement with Bank of America
WASHINGTON – The Justice Department announced today that, as part of its settlement with BAC Home Loans Servicing LP, a subsidiary of Bank of America Corporation, servicemembers whose homes were unlawfully foreclosed upon will each receive a minimum $116,785 plus compensation for any equity lost to compensate them for the bank’s alleged violation of the Servicemember Civil Relief Act (SCRA).
Bank of America agreed to pay $20 million to approximately 160 servicemembers who were illegally foreclosed on between 2006 and the middle of 2009. Under the agreement, Bank of America agreed to provide information about its foreclosures from mid 2009-2010 and will pay damages in the same minimum amount to those servicemembers whose homes were illegally foreclosed upon to compensate for the loss of their homes. The review is on-going.
“The men and women serving our nation should not have to worry about a bank foreclosing on their home while they bravely serve our country,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “The Justice Department will vigorously enforce the laws that protect servicemembers while they do the difficult and necessary work of protecting our country. We have and will continue to work hard to ensure that servicemembers receive the full protections of the law and relief they deserve in a timely fashion.”
On May 26, 2011, the department announced a settlement with BAC Home Loans Servicing LP, formerly known as Countrywide Home Loans Servicing LP, which resolved allegations that the bank unlawfully foreclosed on servicemembers’ homes in violation of the SCRA. This is the largest SCRA settlement ever reached by the department. The Department of Defense also provided critical assistance in identifying the servicemembers whose rights were violated.
Beginning on Nov. 14, 2011, letters will be sent to 157 servicemembers to notify them of the amount of money that they may receive under the settlement. The settlement agreement set a deadline for the end of November 2011 for the Justice Department to determine the amount of damages to which servicemembers may be entitled.
The SCRA provides critical additional consumer and other protections to the men and women serving our nation in the military – its enactment was a recognition that those who are making great sacrifices to protect us deserve our full support at home.
For more information on the Justice Department’s work to protect servicemembers, please visit www.servicemembers.gov
For all you non-military members, $1,500 for your stolen home…
Or as David Dayen puts it…
Let’s recall that the penalty for wrongful foreclosures slated to be paid in the foreclosure fraud settlement being bandied about right now, according to reports, is around $1,500. It is not out of a lack of respect for the men and women of the military when I say that they are not worth 78 times more in compensation for these crimes than everyday men and women abused by mortgage servicers.
And these are crimes, though the DoJ won’t follow through on that. The press release announcing the settlement very pointedly calls the incidents of wrongful foreclosures “the bank’s alleged violation of the Servicemember Civil Relief Act (SCRA).” In the same sentence it says that homes were “unlawfully foreclosed on,” but clearly this is yet another case where the bank won’t have to admit wrongdoing, and can just pay their way out of the problem. As the Justice Department states clearly, violating the SCRA, particularly through an illegal foreclosure while the servicemember is in service, is considered a criminal misdemeanor “which is punishable by a sentence of up to one year imprisonment.” (see page 7 of the linked pdf) Even this extraction of justice falls short.
The servicemembers caught up in this mess deserve that money, all $116,785 of it. And so do hardworking civilians who were duped into loans, ravaged by an Wall Street-caused economic meltdown and stonewalled or outright abused in their effort to save their homes.
Consider this. RealtyTrac announced yesterday that foreclosures were back on the rise, because “lenders corrected foreclosure paperwork and processing problems,” according to its CEO. This is a falsehood. There is plenty of documented evidence showing that robo-signing is still happening. In the states where banks cannot get away with robo-signing, they have all but stopped foreclosing. The backlogs in these states will take several decades to clear. What this all means is that many thousands of American homeowners each month are subject to the same violation that befell these servicemembers – illegal foreclosures. The military members, by virtue of the clout of their institution and a banking industry looking to burnish their public image, are getting a handsome sum from the banks for their troubles. The rest of the borrowers can go jump in a lake.
And this is becoming a pattern. The Senate yesterday passed the “Veteran Employment Displacement of Other Job Applicants Act,” which gives large tax credits to companies that hire veterans, giving them a leg up on any job opening without adding to job growth in any way. The same day, the First Lady announced a private sector commitment to hire 100,000 veterans. Considering that the private sector will collect between $5,600-$9,600 a head for the hiring, I guess so!
A veteran deserves a job, and a military family illegally kicked out of their home deserves as much compensation as possible. Also, the engineer who’s been out of work for two years, and the former teacher looking for a job, or the marketing manager, or the stock-room clerk, or the executive assistant – all of them should have that opportunity as well. And when the banks rip a home away from any one of these people, they deserve justice and accountability too.