California to join multistate probe of banks' foreclosure practices
California will join a multistate investigation of whether banks violated laws by cutting corners while foreclosing on homes, a spokesman for Atty. Gen. Jerry Brown says.
The task force is headed by Iowa Atty. Gen. Tom Miller, who, as reported in this L.A. Times story on the investigation, has taken the lead in previous mortgage-related probes conducted by coalitions of state officials.
Thirty-eight states took part in a recent conference call on the probe, although it's not clear how many will sign on.
But the Golden State is in: "California has decided to join the other attorneys general in the multi-state group," a spokesman for Brown said Tuesday in an e-mail to The Times.
An official announcement on the investigation and participating states was likely to be made Wednesday morning, officials said.
Several large banks, including home-lending giants Bank of America Corp. and JPMorgan Chase & Co., have acknowledged paperwork errors, such as legal affidavits signed by employees who failed to read the documents. But they contend the errors were procedural and that the underlying facts in these cases justified foreclosures.
A Bank of America spokesman said that the typical BofA foreclosure involves a borrower who hasn't made a mortgage payment in 18 months. A third of the Charlotte, N.C., bank's foreclosures are of homes that the borrowers have abandoned, spokesman Dan Frahm said.
--E. Scott Reckard