Skip to main content

Sen. Elizabeth Warren
Sen Elizabeth Warren is already doing the work we elected her to do, the work that had Wall Street so scared of her being in the Senate. She's joined up with Rep. Elijah Cummings to investigate the Independent Foreclosure Reviews. These were set up by the Office of the Comptroller of the Currency (OCC) and the Federal Reserve two years ago to do case-by-case reviews of foreclosures that were caught up in the fraudulent robo-signing scandal.

But that's not really how it's worked out. David Dayen explains.

But the independent reviews turned out to be neither independent nor reviews. As whistleblowers have pointed out, the banks handpicked and paid the salaries of the reviewers, third-party consultants who have increasingly become a substitute for government bank examiners. The data from the borrower files, as well as the guidelines for review, all came from the banks, and in many cases the banks made the determinations of harm themselves, leaving the reviewers to merely check their work. Managers overseeing the consultants overlooked entire categories of borrower harm, even obvious ones like servicers rejecting loan-modification payments from a borrower with a signed agreement, or tallying up impermissible fees. The managers also steered the ground-level reviewers, most of whom were temporary employees with little or no expertise in mortgages or foreclosures, away from reporting significant mistakes. Banks could even appeal whatever errors did get through (borrowers, of course, could not). Meanwhile, the complex rules for scrutinizing the documents extended the time it took to examine each loan file, which was good news for the consultants who raked in well over $1 billion at last count.
Because of these issues, Dayen explains, the new head of the OCC stopped the reviews and determined it would provide compensation to the 3.8 million foreclosure victims from 2009 and 2010, to the underwhelming tune of less than $1,000 per foreclosure. That's not enough for Warren and Cummings. They've asked the agencies for "all performance reviews the two agencies conducted during the program before nixing it; the amount of money the banks paid their third-party reviewers; and the total number of reviews, along with the percentages of those in which errors were found." In other words, how about some transparency?
“Public confidence in the banking system has been badly undermined by a widespread concern that large financial institutions are not held fully to account when they break the rules—and that consumers are not sufficiently compensated,” Warren and Cummings wrote in their letter to the OCC and the Fed last week. “It is critical that the OCC and the Federal Reserve disclose additional information about the scope of the harms found to establish confidence in the sufficiency and integrity of the settlement.”
As Dayen says, this finally could be the beginning of the investigation into the industry over foreclosure fraud. It's not that Cummings hasn't been trying, but being in the minority party in the House has limited his reach. Elizabeth Warren on the majority side of the Banking Committee means that there will be congressional oversight of the industry, and that maybe, just maybe, middle class Americans will have a fighting chance against Wall Street. At the very least, we've now got an ally with power.

Originally posted to Joan McCarter on Wed Feb 06, 2013 at 01:47 PM PST.

Also republished by Daily Kos.

EMAIL TO A FRIEND X
Your Email has been sent.
You must add at least one tag to this diary before publishing it.

Add keywords that describe this diary. Separate multiple keywords with commas.
Tagging tips - Search For Tags - Browse For Tags

?

More Tagging tips:

A tag is a way to search for this diary. If someone is searching for "Barack Obama," is this a diary they'd be trying to find?

Use a person's full name, without any title. Senator Obama may become President Obama, and Michelle Obama might run for office.

If your diary covers an election or elected official, use election tags, which are generally the state abbreviation followed by the office. CA-01 is the first district House seat. CA-Sen covers both senate races. NY-GOV covers the New York governor's race.

Tags do not compound: that is, "education reform" is a completely different tag from "education". A tag like "reform" alone is probably not meaningful.

Consider if one or more of these tags fits your diary: Civil Rights, Community, Congress, Culture, Economy, Education, Elections, Energy, Environment, Health Care, International, Labor, Law, Media, Meta, National Security, Science, Transportation, or White House. If your diary is specific to a state, consider adding the state (California, Texas, etc). Keep in mind, though, that there are many wonderful and important diaries that don't fit in any of these tags. Don't worry if yours doesn't.

You can add a private note to this diary when hotlisting it:
Are you sure you want to remove this diary from your hotlist?
Are you sure you want to remove your recommendation? You can only recommend a diary once, so you will not be able to re-recommend it afterwards.
Rescue this diary, and add a note:
Are you sure you want to remove this diary from Rescue?
Choose where to republish this diary. The diary will be added to the queue for that group. Publish it from the queue to make it appear.

You must be a member of a group to use this feature.

Add a quick update to your diary without changing the diary itself:
Are you sure you want to remove this diary?
(The diary will be removed from the site and returned to your drafts for further editing.)
(The diary will be removed.)
Are you sure you want to save these changes to the published diary?

Comment Preferences

DeminNewJ, Bill in Portland Maine, copymark, slinkerwink, abarefootboy, Gooserock, Danno11, emal, greenbird, MouseThatRoared, Shockwave, Wintermute, eeff, LeftHandedMan, Creosote, Doctor Who, bronte17, 714day, PBnJ, shanikka, Frederick Clarkson, pedrito, denig, egarratt, Nate Roberts, splashy, artebella, Chrisfs, jdmorg, psnyder, TexDem, flatford39, hoplite9, chickeee, lcrp, Noisy Democrat, ybruti, Sembtex, ScienceMom, xyz, Emmy, Gowrie Gal, vcmvo2, ExStr8, Ckntfld, chimene, OpherGopher, sap, Simplify, YucatanMan, fixxit, eru, Beetwasher, Pam from Calif, Dem Beans, where4art, Gordon20024, kaliope, Lindy, Alan Arizona, Jim R, Jim P, begone, BachFan, irishwitch, 417els, cookseytalbott, smokeymonkey, KenBee, kck, Lefty Coaster, blueoasis, MJ via Chicago, philipmerrill, gpoutney, alwaysquestion, armadillo, CTLiberal, Preston S, el cid, sceptical observer, justiceputnam, onionjim, profh, Clive all hat no horse Rodeo, BeninSC, byDesign, yoduuuh do or do not, Wino, DvCM, Mary Mike, flumptytail, dclawyer06, Aunt Martha, bobswern, carpunder, hopi13, janatallow, Assaf, thewhitelist, TomP, cville townie, mconvente, also mom of 5, wayoutinthestix, Involuntary Exile, elwior, Cat Servant, monkeybrainpolitics, Lujane, tofumagoo, smartdemmg, triplepoint, Liberal Of Limeyland, Horsefeathers, petulans, elpacifico66, Parthenia, BYw, dmhlt 66, shortgirl, maggiejean, enemy of the people, Bule Betawi, multilee, cybrestrike, jennylind, kravitz, fromcascadia, stevenwag, sfarkash, jpmassar, Larsstephens, Words In Action, Railfan, Just Bob, Proud Mom and Grandma, renzo capetti, I Lurked For Years, Kristina40, DiegoUK, Betty Pinson, roystah, ericlewis0, Loose Fur, slice, annieli, MidwestTreeHugger, slowbutsure, trumpeter, Hohenzollern, thomask, muddy boots, Grandma Susie, MRA NY, VTCC73, Caddis Fly, SteelerGrrl, DRo, MichaelNY, Davui, PrometheusUnbound, No one gets out alive, BlueDragon, Siri, ahumbleopinion, SilverWillow, Eric Nelson, a2nite, This old man, kellius, radical simplicity, lunachickie, AverageJoe42, Glen The Plumber, Ray Pensador, Lily O Lady, Dallas L, countwebb, smokey545, jbob, Thornrose, poopdogcomedy, dear occupant, motherlu, alice kleeman, howabout, Jacoby Jonze, aughtomatic, footNmouth, Betterthansoap, Dodgerdog1, OldSoldier99, Capt Crunch

Subscribe or Donate to support Daily Kos.

Click here for the mobile view of the site