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Friday, October 15, 2010

Could the Alleged Bank Fraud Lead to Jobs, for the some Unemployed Americans'?

Sign Of The Times - ForeclosureImage by respres via Flickr
Financial institutions across the nation, might have to ramp up staff to deal with in impact of the question of processing possibly fraudulent foreclosure documentation, removing many America citizen's from their home. 

With the nations' unemployment rate standing at 9.6 percent, many unemployed job seekers are available, to assist the banks with their troubling issues.

Attorney Generals from all 50 states have launched an investigation into the foreclosure processes of the a large number of the nation's banks, including JP Morgan, Chase, Bank of America, Goldman Sachs via Litton Loans and Ally (Formerly GMAC) Financial. 

The banks have admitted to having unqualified workers "robo-signing" foreclosure documents without reading them. Calls on the accountability for the financial institution possibly violating laws as they foreclosed on delinquent borrowers, are beginning to increase.

Congressional Democrats, on an election recess period until the second week of November, have seized on the issue and begun calling for investigations or an immediate moratorium in their states. 

House Speaker Nancy Pelosi and other California Democrats have asked the Justice Department, the Federal Reserve and the Office of the Comptroller of the Currency to launch investigations into foreclosure fraud. Sens. Al Franken (D-MN.), Bob Menendez (D-NJ) and Jeff Merkley (D-OR), and Reps. Barney Frank (D-MS), Corrine Brown (D-FL), Luis Gutierrez (D-IL) and Dennis Moore (D-KS) have also asked government agencies and/or banks to investigate.

On October 3, Senate Majority Leader Harry Reid (D-NV.) wrote a letter to Ally Financial, Bank of America, Wells Fargo, Citigroup and JPMorgan Chase, urging them for a moratorium.

"I write to request that your mortgage-servicing division suspend foreclosures on Nevada home owners until systems are in place to ensure Nevadans are not being improperly directed into foreclosure proceedings," the letter reads via Huffington Post

A freeze on foreclosures has also been pushed by House of Representatives Congresspersons' Alan Grayson (D-FL.), John Conyers (D-MI.), Carolyn Kilpatrick (D-MI), Maxine Waters (D-CA),Debbie Wasserman-Schultz (D-FL.), Gabrielle Giffords (D-AZ), Elijah Cummings (D-MD) and Earl Blumenauer (D-OR).

The probe could mean a dramatic increase of hiring at banks that will need to take on more employees, to ensure that proper processes legal process are followed in the future.

Scott Talbott, the senior vice president for government affairs at the Financial Services Roundtable, a trade group that represents major banks, told The Street that banks are likely to hire more employees to read foreclosure files.

"Since the essential problem was that employees were overburdened by the volume of the foreclosures and didn't take the time to read the file before signing the affidavit, the fastest, most efficient, most accurate solution is to hire more employees to read the files," he said. 

However, banking spokespeople did not appear ready to announce a big hiring spree, at the present time.

"We have increased our foreclosure prevention staff from approximately 2,000 at the end of 2007 to more than 5,000 today," wrote Citigroup spokesman Mark Rodgers. 

"We continually review our staffing needs, but it is important to remember that the affidavits were prepared by appropriate personnel with knowledge of the relevant facts based on their review of the company's books and records," JP Morgan Chase spokesman Tom Kelly cited to The Street. "The issue was with the signatures and notarization," wrote spokesman Tom Kelly. When asked what it would do to address paperwork issues, he wrote, "we re-file as appropriate."

Considering the issues with possibly illegal foreclosures is suspected to backdate a number of years without the financial institutions acknowledging the alleged errors, until an exposed investigation by a Florida civil attorney; it is not surprising that they would elect to be non-committal on hiring, until Congress investigation process goes forward. 

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