Florida attorney general slams banks' foreclosure practices
Florida Atty. Gen. Pam Bondi's office has released a highly critical PowerPoint presentation explaining the legal issues surrounding the foreclosure fracas that erupted late last year.
See the full report here.
Titled "Unfair, Deceptive and Unconscionable Acts in Foreclosure Cases," the presentation includes alleged examples of fraud and does a good job explaining the complicated process of securitization and some of the missteps major financial institutions made when they wrote, packaged and sold mortgages during the boom years. It explains how those missteps have come back to haunt banks during the housing market's decline.
Several major lenders announced partial freezes in foreclosure last year after admitting that they had employed so-called robo-signers -- people who legally attested to the accuracy of foreclosure documents without reading them -- in the states where the courts oversee the process. Analysts are expecting that pause to be largely temporary, however, and are predicting a big surge in repossessions early this year.
Bank of America lifted its national foreclosure freeze last month. The bank was the only major lending institution to have declared a freeze in foreclosures nationally, including in the state of California, where robo-signing was largely a non-issue because the vast majority of repossessions take place outside of the court system.
Bank of America owns a large portion of California's troubled loans because of its purchase in 2008 of Countrywide Financial, the Calabasas mortgage lender that became the symbol for shoddy lending practices during the boom years. Bank of America is also the largest financial institution in the U.S.
An investigation into the practices of banks by 50 state attorneys general continues, and the investigation goes beyond robo-signing.
-- Alejandro Lazo
Photo: Florida Atty. Gen. Pam Bondi