Democratic Leader Nancy Pelosi and Congresswoman Jackie Speier sent a letter today to Attorney General Eric Holder requesting he direct the Justice Department's Financial Fraud Enforcement Task Force to examine whether any violations of Federal law occurred in the processing of foreclosures in San Francisco.
The County of San Francisco's Office of the Assessor-Recorder recently commissioned a report assessing compliance with applicable foreclosure laws by certain entities in the mortgage industry operating in San Francisco.
Below is the full text of the letter.
February 17, 2012
The Honorable Eric H. Holder, Jr.
Robert F. Kennedy Department of Justice Building
950 Pennsylvania Ave., NW
Washington, DC 20530
Dear Attorney General Holder:
We are writing to request that you direct the Justice Department's Financial Fraud Enforcement Task Force to examine whether any violations of Federal law occurred in the processing of foreclosures in San Francisco.
The County of San Francisco's Office of the Assessor-Recorder recently commissioned a report, which is enclosed, assessing compliance with applicable foreclosure laws by certain entities in the mortgage industry operating in San Francisco. The report, based on a review of a random sample of mortgage loans that entered into foreclosure between January 2009 and October 2011, found that 99 percent of the San Francisco mortgages reviewed showed irregularities in the foreclosure process, and 84 percent showed potential violations of California non-judicial foreclosure laws. In addition, foreclosures involving mortgages that were part of the Mortgage Electronic Registration System (MERS), which are more likely to have been securitized, showed a high rate of conflicting information regarding the actual beneficiary, which raises questions about whether homeowners were denied their due process rights. We find these findings very troubling.
Because the report does not specify the mortgage servicers involved, it is not possible to determine whether affected borrowers can seek remedies under provisions in the multi-state mortgage settlement. However, even if some borrowers can seek redress through the settlement process, or through private rights of action, the irregularities and violations cited in the report convince us that further investigation at the Federal level is warranted to determine whether any violations of Federal civil and criminal laws might have occurred.
The Assessor-Recorder has already referred the report's findings to California Attorney General, Kamala Harris, for her review. We believe the severity of the report's conclusions also warrant a thorough review at the Federal level by the Task Force.
We appreciate the hard work of the Obama Administration and the state Attorneys General, including the helpful protections for borrowers secured by California Attorney General Kamala Harris, in achieving a multi-state mortgage settlement. We are hopeful that preserving the ability of the states and the Federal government to continue to pursue actions not covered by the terms of the settlement will ensure that homeowners who experienced losses unfairly, particularly where abusive practices were the cause, will be able to seek a remedy.
Thank you for your attention to this matter.
Member of Congress