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A top OCC official faced sharp questions about the ties between mortgage servicers and the consultants that are reviewing their past business practices.
December 13 -
Federal regulators have ordered 14 mortgage services to help borrowers that were harmed by foreclosure errors, but left it up to them to develop common remediation guidelines. The servicers and their consultants met in Washington this week to try and reach a consensus.
November 10 -
OCC head tells American Banker regulatory symposium that banks could face restitution after complaint reviews. Gruenberg, meanwhile, announces FDIC community-bank initiatives.
September 19
WASHINGTON — Four congressional Democrats have asked a watchdog agency to assess potential conflicts of interest between banks and the third-party auditors that are reviewing their past foreclosure practices.
Sen. Robert Menendez, Rep. Maxine Waters, Rep. Luis Gutierrez and Rep. Brad Miller requested that the Government Accountability Office conduct an assessment of the foreclosure review process established last year by federal banking regulators.
"A toothless foreclosure review is simply not enough," Menendez said Thursday in a press release.
"We need the GAO's independent assessment to ensure the process is fair to homeowners — especially since regulators are letting the big banks pick their own auditors. That's like letting the fox watch the henhouse."
In a letter to GAO, the Democratic lawmakers posed 14 specific questions that they want the watchdog agency to answer. The Democrats' attempt to involve GAO is part of their ongoing effort to pressure bank regulators into making the process tougher on banks.
During a congressional hearing last month, Menendez and other Senate Democrats hammered Deputy Comptroller Julie Williams for what they described as an overly cozy relationship between the banks and the third-party consultants that are conducting the reviews.
Williams pushed back against the criticism, saying that regulators had the ability to reject the banks' choice of consultants based on a review of their past work.
The review process was designed by the Office of the Comptroller of the Currency and the Federal Reserve Board following allegations of robo-signing and other improper foreclosure practices by banks.
Under the process, a homeowner whose home was in the foreclosure process in 2009 or 2010 can seek a review of his or her case, and can potentially receive compensation if the review finds evidence of harm as a result of errors or misrepresentations.
