U.S. mortgage task force to act soon

by 21 Sep 2012

(Reuters) - The mortgage task force formed by President Barack Obama to probe misconduct that contributed to the financial crisis will soon take legal action, New York Attorney General Eric Schneiderman said on Thursday.

Schneiderman, a co-chair of the task force, would not say whether cases would be brought against individuals or financial institutions. He also would not comment on whether criminal charges would be filed.

But he said his office would take action and that he expected his federal counterparts on the task force to do so as well.

"We'll see actions being taken sooner rather than later," said Schneiderman, speaking in an interview at his office in New York.

The Residential Mortgage-Backed Securities Working Group was formed in January, to probe the pooling and sale of risky mortgages in the runup to the 2008 financial crisis. Obama said he was creating the group to "hold accountable those who broke the law" and "help turn the page on an era of recklessness."

Schneiderman said he believes it is still necessary to go after the "bad actors" to restore confidence in the financial markets.

"It's important to convey the sense that no one is above the law. There's a set of rules to which all will be held accountable, including big players on Wall Street," Schneiderman said.

Schneiderman noted that only days earlier protesters had gathered in a park nearby to mark the first anniversary of the Occupy Wall Street movement.

Last year, Schneiderman fought to limit the scope of a $25 billion settlement with major banks over foreclosure abuses. He wanted authorities to retain the ability to probe misconduct in the securitization of mortgages, the area now being investigated by the task force.

The task force includes the Justice Department, the Securities and Exchange Commission, the Department of Housing and Urban Development and the Internal Revenue Service.


  • by Kim | 9/21/2012 3:34:16 PM

    Will this "new" action help homeowners whose mortgages were put into a CWMBS Trust? We've been trying for 3 years to get a modification. We're current; never missed a payment, but because of the extreme reduction in our incomes, our mortgage payment is 50% of our income. The bank told us that we qualified under the MHA program. They sent us denials that didn't make sense. Each department told us different things. The Hope Hotline, HAMP Solutions - all of these agencies that are supposedly there to help homeowners never did anything. They'd just say that they couldn't make the bank do anything - even if they weren't following the guidelines. They'd escalate our application and have us re-apply over and over. Anyway, after 3 years, the bank told us that even though we qualify, our investor won't let them help us.

    Will this new program help us? It's not right that the government gave the banks so much money and they won't help responsible homeowners that need help and have done the right thing. The bank put our mortgage in this trust without our approval. It's not fair that we can't modify our mortgage because of their action - not ours. We're not asking for a handout (like they got). We should be able to get a HAMP modification like other homeowners that meet the guidelines. We've been told to QUIT paying our mortgage and then we'd get help. That's not right.


Should CFPB have more supervision over credit agencies?