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American Banker - Waters Asks for Investigation into B of A Foreclosure Tactics

News Article

Location: Washington, DC

By Victoria Finkle

Rep. Maxine Waters, the top Democrat on the House Financial Services Committee, is asking for an investigation into claims that Bank of America purposefully delayed borrowers from entering the Home Affordable Modification Program.

The California Democrat penned letters to several government officials on Tuesday, asking that they to look into the allegations made in an ongoing lawsuit, which were detailed in a report by Bloomberg last week.

"It has come to my attention via a June 14th Bloomberg article I have enclosed, that employees at one of the nation's largest servicers are alleged to have 'falsified records and were told to delay U.S. loan-assistance applications by requesting paperwork that the (bank) had already received,'" Waters said in letters to Christy Romero, special inspector general of the Troubled Asset Relief Program, Ben Bernanke, chairman of the Federal Reserve Board and Thomas Curry, comptroller of the currency.

She added: "The goal of the delay, according to the article, was to ensure that rather than receiving a HAMP modification, the borrower would be foreclosed upon. It has been noted in numerous studies that foreclosure is often the most profitable end result for a servicer that does not own the loan they are servicing. It goes without saying that this is an outright abuse of consumers and government mortgage assistance programs."

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