Frustrated at experiencing bank violations of legal requirements, community organizations attended shareholder meetings to protest. Organizations from California and New York traveled to Tampa on May 21st to speak out at JPMorgan Chase’s annual shareholder meeting and demand accountability by the bank.
The groups, which hold shares in JPMorgan Chase, detailed the harms the bank causes to communities throughout the country through its abusive and discriminatory mortgage lending and foreclosure practices.
The groups supported resolutions that would require the bank to disclose its lobbying activities and spending and to separate the positions of Board Chair and bank CEO. JPMorgan Chase has lobbied heavily against financial reform despite its failure to impose regulations written to ensure that the bank treats homeowners in foreclosure fairly and to prevent significant proprietary trading losses.
“CRC’s survey of mortgage counselor’s shows JPMorgan Chase is failing borrowers by discussing loan modification while proceeding with foreclosure, not notifying borrowers of documents needed and losing documents,” said Alan Fisher, Executive Director of the California Reinvestment Coalition.
“We believe the strategic ability of the Bank to respond to potential lawsuits and customer needs is hampered by Jamie Dimon filling the strategic role of Board Chair at the same time as the tactical role of CEO.”
“The bank’s abysmal track record in lower income communities highlights the need for strong regulatory oversight. Despite this, JPMorgan Chase spends millions and employs dozens of lobbyists to weaken critical financial reform legislation and regulation that would protect communities from lending and foreclosure abuses and curb risky trading practices that put the American economy at risk,” said Alexis Iwanisziv, Research and Policy Analyst at NEDAP, an economic justice organization based in New York City.
According to a report issued by the California Reinvestment Coalition “California families and neighborhoods have been suffering greatly under the weight of the foreclosure crisis. This last year has brought major policy developments to California, including the $25 billion Attorney Generals National Mortgage Settlement (NMS) and the landmark Homeowner Bill of Rights (HBOR) legislation.
The NMS requires the five largest servicers to provide considerable consumer relief and honor important foreclosure processing reforms. HBOR, which imposes new servicer obligations and gives consumers the right to sue their servicer in court, was cited as the reason for the large drop in foreclosure starts in California in February and again in March. As NMS settlement progress reports are released and real estate trends are examined, the lingering question is whether the NMS and HBOR have successfully changed bank practices so that homeowners struggling to avoid foreclosure have a fighting chance to do so.”
The legislation outlines specific performance standards for the banks. The report by the California Reinvestment Coalition’s Kevin Stein examines the performance of each bank in light of the regulations. The CRC works throughout California with non profit organizations charged with working with homeowners in accessing loan rewrites from the banks. The most recent survey sites data illustrating non compliance in several areas.
- First, the banks are supposed to have a single point of contact. The report states that more than 70% of the counselors found that the banks were neither accessible, consistent nor knowledgeable.
- Second, the report found that in 60 % of the cases Chase, B of A, Wells Fargo and Citibank, while having the client go through loan modification the banks were still trying to foreclose on them.
- Third, CRC found that the banks were not completing the loan modifications and leaving clients hanging.
- Fourth, the report states that the banks were taking longer to complete the loan modifications in accordance with the regulatory timelines.
- Fifth, the banks were losing the papers for the loan modifications frequently.
- Sixth, in 60% of the cases the major banks were actually losing the documents that the client had filed.
- Seventh, they denied the loan modifications based on specious standards and outside regulatory standards.
Banks tended to make higher numbers of sub prime loans in poorer neighborhoods during the lending frenzy of 2006 – 2009. According to the report by CRC,the “big five” continue the pattern of discriminating against poor neighborhoods by making fewer loan modifications in poorer neighborhoods.
According to the CRC report:
“When asked which servicer asked was most difficult to work with, most counselors named Wells Fargo, with Bank of America coming in a close second. Counselors report modest improvement in certain areas. HBOR’s private right of action and the threat of litigation for illegal bank practices, as well as the strong work of the California Monitor of the NMS, deserve credit for imposing added measures of servicer accountability in our state.”
Alan Fisher, the Executive Director of CRC,and other CRC staff have attended every bank shareholder meeting and was able to do so because the CRC Board of Directors bought shares in each bank over ten years ago. He stated:
“it is critical that the CEO’s, Board members and major shareholders of the mega-banks hear the voices of communities that continue to be ignored and suffer foreclosures and lack of credit access that is causing deep divisions in neighborhoods and families.”