Obama promised justice to abused American homeowners. Have they gotten it?
By Yves Smith
Editor’s Note: In his 2012 State of The Union address, President Obama spoke of American homeowners abused by unscrupulous banks and financial institutions. Have they gotten justice? What follows is the first in a new series examining foreclosure settlements and the disturbing patterns of incomptency, malfeasance, and conflicts of interest which have marked their execution. Yves Smith of Naked Capitalism takes a deep dive into the mire of America’s mortage industry and investigates the continued suffering of the public at the hands of greedy predators.
On January 7, 2013, ten servicers entered into an $8.5 billion settlement with the Office of the Comptroller of the Currency and the Federal Reserve, terminating a foreclosure review process which was set forth in consent orders issued in April 2010. Borrowers who had had foreclosures that were pending or had completed foreclosure sales in 2009 and 2010 could request an investigation by independent reviewers, selected and paid for by the servicers but subject to approval by the OCC.