Bank of America to resume foreclosures
A Bank of America customer uses an ATM at a branch in Hollywood on October 19, 2010. Two top US banks are moving on the offensive as they struggle to put the foreclosures quagmire behind them, but the scandal continues to menace the financial sector. Bank of America, the country's largest bank by assets, said it was lifting freezes on more than 100,000 foreclosure cases in 23 states, insisting it had not found any flaws in their processing. Bank of America, which had announced a nationwide moratorium on foreclosures to review its paperwork on October 8, nevertheless said the freeze will stay in place for now in the remaining 27 states.
TEXT OF INTERVIEW
JEREMY HOBSON: Bank of America is resuming foreclosures in almost two dozen states this week. The bank had halted foreclosures nationwide after discovering problems with paperwork. B of A now admits it has found misspelled names and incorrect data. Marketplace's Nancy Marshall Genzer is with us live from Washington with more on this.
Good morning, Nancy.
NANCY MARSHALL GENZER: Good morning, Jeremy.
HOBSON: So Nancy, they admit there were mistakes, but they're going forward with foreclosures?
GENZER: The bank says it did find some of these types of errors, but only in a small number of cases. And the mistakes include things like a lack of signatures and files that are missing. Some borrower's names were misspelled. The bank says no homes were foreclosed upon in error. So, it's going ahead with foreclosures in the 23 states right now.
HOBSON: Nancy, you're in Washington, is the government going to do anything about this?
GENZER: Well Jeremy, you may have heard there's an election next week.
HOBSON: Is that right?
GENZER: Yeah. And democrats have been saying, "Hey look," the financial reform law they pushed through Congress will prevent this kind of thing. You could say the foreclosure problems are a first test for the new law. The New Financial Stability Council is trying to get a handle on this latest twist in the foreclosure saga. There are worries it could cause another crisis for banks, but this council has only met once so far. And here's another thing, Jeremy -- most of the action right now is at the state level. And that's because these foreclosure mistakes involve state property laws. The 50 attorneys general nationwide are conducting an investigation.
HOBSON: Okay, Marketplace's Nancy Marshall Genzer in Washington, thanks.
GENZER: You're welcome.