Iowa AG hears it from N.Y.'s Congressional delegation

John O'Brien Aug. 30, 2011, 1:23pm


DES MOINES, Iowa (Legal Newsline) - Iowa Attorney General Tom Miller continues to feel backlash over his decision to remove his colleague from New York from a committee negotiating a nationwide foreclosure settlement.

Twenty-one members of New York's Congressional delegation wrote Miller on Thursday to express their disapproval of Miller's actions, which resulted in the removal of New York Attorney General Eric Schneiderman from the committee on Aug. 23.

Miller said Schneiderman has "actively worked to undermine" the efforts of the committee.

"Raising legitimate concerns about elements of the proposed settlement is a responsibility of every member of the executive committee and should never be the basis for silencing a viewpoint," the delegation wrote, according to the New York Daily News.

"Your removal of Attorney General Schneiderman sets a dangerous precedent for other attorneys general who, out of fear of what might happen, may choose silence over voicing valid concerns with particular aspects of the proposed settlement. Moreover, your attempt to banish opposition rather than address varying viewpoints undermines both the validity of the process and any settlement reached by the committee."

State attorneys general, the U.S. Justice Department, Treasury Department and the new Consumer Financial Protection Bureau are in the midst of negotiating a deal with the five mortgage servicers -- Bank of America Corp., Wells Fargo & Co., JPMorgan Chase & Co., Citigroup Inc. and Ally Financial Inc.

Miller, in a statement, pointed to Schneiderman's refusal to join a negotiation committee in June.

"Since that time, New York has actively worked to undermine the very same multistate group that it had spent the previous nine months working very closely with," the Iowa attorney general said.

"While we certainly respect the right of any state to choose to no longer participate in a multistate and to pursue another path, working to actively undermine a multistate while still a member of the executive committee simply doesn't make sense, is unprecedented and is unacceptable."

Schneiderman, like a handful of other state attorneys general, is currently doing his own comprehensive investigation into the mortgage industry.

John L. O'Brien, register of deeds for Southern Essex County in Massachusetts, called Miller's move a "travesty of justice."

O'Brien is calling for Miller to remove himself from the committee.

"Miller has received hundreds of thousands of dollars in campaign contributions from the very bankers and their associates that he purports to regulate. It seems to me that he has become the voice of Wall Street and he has abandoned Main Street," he said.

"If property rights mean anything in this country, the attorneys general will cease all talks with these banks immediately, and I am urging the American people to contact their attorney general and ask them to do just that."

The Iowa Citizens for Community Improvement also came out against Schneiderman's removal.

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