The Financial Times has a good piece of reporting on page one of today’s paper that advances the ball on the foreclosure scandal.
Up to now, Wells Fargo and Citigroup have been conspicuous among too-big-to-fail banks for keeping its foreclosure machine churning. JPMorgan Chase and Bank of America have both stopped foreclosures nationwide as they review their practices, as has GMAC aka Ally Financial.
Smart reporters notice that stuff and zero in on it. The FT‘s story will force the moratorium issue with Wells.
It reports that Wells used the now notorious robosigners to fraudulently speed through foreclosure documents:
In a sworn deposition on March 9 seen by the FT, Xee Moua, identified in court documents as a vice-president of loan documentation for Wells, said she signed as many as 500 foreclosure-related papers a day on behalf of the bank.
Ms Moua, who was deposed as part of a foreclosure lawsuit in Palm Beach County, Florida, said that the only information she verified was whether her name and title appeared correctly, according to the document.
Asked whether she checked the accuracy of the principal and interest that Wells claimed the borrower owed – a crucial step in banks’ legal actions to repossess homes – Ms Moua said: “I do not.”
It also has another deposition from a Wells robosigner in its accompanying inside story.
The FT, like the Journal has been behind on this story, at least in the paper itself. The FT‘s Tracy Alloway, writing for its Alphaville blog has been doing good stuff on the implications of the scandal for mortgage securities markets. It’s good to see the paper get in the ballgame a little more here.
So, above-mentioned smart reporters ought to be digging into Citigroup’s foreclosure practices right about now.
In fact, one question to ask is was there any major mortgage servicer that did things the right way? If so, why and how? That could be illuminating.
Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR’s business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu. Follow him on Twitter at @ryanchittum.