David Dayen at Firedoglake took a look at the latest version of the proposed foreclosure fraud settlement this morning, and (surprise, surprise), it’s still “woefully inadequate”.
In a nutshell, those who lost their homes to fraudulent proceedings would get about $1500–about enough to pay a security deposit on a nice place in the midwest or a studio apartment (maybe) in Manhattan. Of course, there would be other aspects to the settlement. For example, a largely redundant refinancing program that will ultimately benefit the banks and a principal reduction program that will barely scratch the surface of the nationwide underwater mortgage problem.
And, of course, the banks would get a whole lot of protection in return: though homeowners could still pursue individual claims, the banks would get immunity from state and federal claims related to servicing, foreclosure practices and even origination practices.
The releases, then, are pretty comprehensive, on servicing, foreclosure and origination. Homeowners can sue, but the banks know well that they can outgun individuals in court much more easily than an entire state. Securitization abuses would still be fair game for the states, and this is seemingly being done to entice AGs like Eric Schneiderman into the fold, though that seems unlikely. Still, even with securitization fraud available, you’re talking about the AGs only able after the settlement to go to bat for rich investors, not individual homeowners fleeced by banks. And despite no meaningful investigations, all this would be given away for a relative pittance.
Read the full analysis here: Proposed Foreclosure Fraud Settlement Still Looks Woefully Inadequate