Federal regulators have reached settlements with two major Wall Street firms and a British lender requiring the companies to pay more than three-quarters of a billion dollars to resolve claims over “deficient practices in mortgage loan servicing and foreclosure processing.”
The agreements settle enforcement actions brought by the Federal Reserve and the Office of the Comptroller of the Currency and are similar to the $8.5 billion insettlements reached earlier this month with ten other mortgage servicing companies. With the latest agreements, mortgage companies have been hit with more than $35 billion in fines and settlement costs related to the types of improper notarization and document signing practices at the heart of the “robo-signing” crisis.
Under the terms of the latest settlements:
- Goldman Sachs and Morgan Stanley will pay $557 million in payments to borrowers, debt forgiveness and loan modifications.
- British-based HSBC will pay $249 million in similar compensation.
According to a statement from the Federal Reserve, government regulators are working to reach similar agreements with other mortgage servicers.
Michael Lewis is Managing Editor at the National Notary Association.