Two Banks Agree on Fines to End OCC Foreclosure Enforcementby
U.S. Bancorp will pay $10 million, Santander $3.4 million
Lenders were among several failing to meet earlier accords
U.S. Bancorp will pay $10 million and Banco Santander SA agreed to turn over $3.4 million to settle Office of the Comptroller of the Currency complaints over missteps in how the banks handled regulators’ orders to fix faulty foreclosure practices.
The fines stem from violations of 2013 accords over mortgage-servicing flaws, the OCC said in a statement Tuesday. The new penalties close out a series of restrictions the companies were placed under in June after they failed to live up to earlier agreements related to loans mishandled after the 2008 financial crisis.
U.S. Bank and the Santander U.S. unit formerly known as Sovereign Bank were among a group of mortgage 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 and to fix their practices.
Several of them later fell short in meeting those settlements, according to regulators. The OCC, which oversees national banks, penalized six of those companies in June, restricting their purchases of servicing rights until they fulfilled their agreements. Tuesday’s deal frees Minneapolis-based U.S. Bancorp and Madrid-based Santander from those constraints.
The OCC’s actions underline that Santander has “implemented a significant number of practices to improve how our mortgages are serviced,” according to a statement issued by the bank. Dana Ripley, a U.S. Bancorp spokesman, said his company is pleased to have the dispute resolved.
Last month, JPMorgan Chase & Co. faced a similar action, paying $48 million to resolve its own failures. Bank of America Corp., Citigroup Inc., PNC Financial Services Group Inc. and OneWest Bank -- acquired by CIT Group Inc. last year -- are among the firms that 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 still face restrictions on mortgage servicing.