- Lender fell short on 2013 settlement terms with regulators
- Final fine concludes accusations of mishandled foreclosures
JPMorgan Chase & Co. will pay $48 million to settle the last in a series of missteps in its handling of foreclosures after the 2008 credit crisis, according to the Office of the Comptroller of the Currency.
The largest U.S. bank by assets will be fined for failing to meet terms of a 2013 accord over mortgage-servicing flaws, the agency said in a statement Tuesday. The new fine will close out JPMorgan’s OCC obligations from the earlier order, under which it had previously faced $2 billion in penalties and payments to borrowers.
The bank was among a group of major U.S. servicers accused of mishandling loan papers or robo-signing -- fraudulently endorsing affidavits used in foreclosures. After an aborted effort to force the banks to review individual files for wrongdoing, most of the companies agreed in 2013 to pay a combined $10 billion in settlements with regulators and to fix their practices.
Several of them, including JPMorgan, failed to live up to their promises in those settlements, according to regulators. Last year, the OCC found JPMorgan was continuing to “engage in unsafe and unsound practices” and had failed to meet 10 of 98 requirements in the 2013 settlement, including new practices for communicating with borrowers and putting its final compliance policies in place.
The OCC, which oversees national banks, already penalized JPMorgan and five other companies in June, restricting their purchases of servicing rights until they fulfilled the rest of their agreements. Tuesday’s deal frees JPMorgan from those constraints.
“Our mortgage employees have worked very hard over the last several years to make changes that will further enhance the customer experience and we’re pleased by the outcome of the OCC’s assessment of our work,” Elizabeth Seymour, a JPMorgan spokeswoman, said in an e-mailed statement.
Bank of America Corp., Citigroup Inc., PNC Financial Services Group Inc. and OneWest Bank -- acquired by CIT Group Inc. last year -- had already met their requirements, the OCC said last year. Other banks -- including Wells Fargo & Co., the biggest U.S. mortgage lender -- failed to satisfy the agreements and have had their servicing activities restricted. Wells Fargo and HSBC Holdings Plc were expected to face the toughest restrictions because of the volume of unresolved work, Morris Morgan, the OCC’s deputy comptroller for large banks, said in June.
U.S. Bancorp and Santander Bank NA are others firms that fell short, and the OCC said it was weighing further enforcement action. On Tuesday, the OCC also said EverBank Financial Corp. had finished its settlement requirements, though it must pay a $1 million fine for not doing so earlier.
Under the 2013 accords, more than a dozen servicers provided almost $4 billion in checks to individual borrowers. The mailing list included more than 4 million people who faced foreclosures in 2009 and 2010, whether or not their cases involved wrongdoing.