Congresswoman Maxine Waters (CA-43), Ranking Member of the Financial Services Committee, issued the following statement today regarding the $8.5 billion foreclosure review settlement between the OCC, the Federal Reserve Board and ten mortgage servicers:
"The settlement announced today between the Office of the Comptroller of the Currency (OCC) and the Federal Reserve Board and ten major mortgage servicers appears to mark an end to what was a deeply problematic Independent Foreclosure Review (IFR) process.
"In the 18 months since the Independent Foreclosure Review was announced, I have expressed concerns about the independence of the consultants selected to review homeowner files for potential harm, the complexity of the materials sent to borrowers, and a lack of outreach by servicers to impacted households, particularly to minority borrowers. My concerns were validated in a report I requested from the Government Accountability Office (GAO) in June of 2012, and I expect they will be further confirmed in an additional GAO report expected in early 2013.
"I’m pleased that the OCC has recognized these concerns and acknowledged that the IFR process was poorly designed and executed. However, the blanket settlement announced today raises several significant questions that must be answered before Congress and the public can have confidence in the new process. These include how the settlement amount was determined, how eligible households will be identified and contacted, and how aid will be distributed to these households. Moreover, I believe that the OCC must explain why the IFR process was abandoned. I hope that the end of the IFR process does not mean that there will never be public reporting on the scale and nature of the servicers’ system breakdowns. I fear that if the public and policymakers lack that information, it will constrain our ability to reform the mortgage servicing industry prospectively, something the Consumer Financial Protection Bureau is currently undertaking.
"I will continue to work with the OCC and the Federal Reserve Board to ensure transparency on this settlement and further explanation of the preliminary results of, and reasons for cancelling, the IFR process."