Ky. AG: No protection for banks in mortgage probe
FRANKFORT, Ky. (Legal Newsline) - Kentucky Attorney General Jack Conway is now one of a handful of state attorneys general who say they are against giving banks protection against additional claims over and investigations into their mortgage practices.
Conway told Louisville's Courier-Journal he opposes any offer of government immunity to the financial institutions.
State attorneys general -- including Conway -- the U.S. Justice Department, Treasury Department and the new Consumer Financial Protection Bureau are in the midst of negotiating a deal with mortgage servicers Bank of America Corp., Wells Fargo & Co., JPMorgan Chase & Co., Citigroup Inc. and Ally Financial Inc.
The probe began in October with inquiries into so-called "robosigning" practices by several mortgage companies, and has since broadened into identifying and addressing additional alleged improper foreclosure practices.
"We are a little concerned the banks may not be taking us seriously," Conway told the newspaper Thursday. "We want them to know if they don't come up with an agreement we are going to take some actions."
The attorney general is the latest to come out against the ongoing settlement negotiations, particularly the issue of liability releases.
Delaware Attorney General Beau Biden and Massachusetts Attorney General Martha Coakley both have said they would hesitate signing a deal that could protect the banks from continuing mortgage investigations.
Nevada's Catherine Cortez Masto has said she was going to be "cautious" about whether to sign a settlement with the five banks, especially if it could impact her state's own litigation.
New York Attorney General Eric Schneiderman has argued that servicing is the at the center of the proposed $20 billion deal with the banks.
Last month, Schneiderman, who is currently doing his own comprehensive investigation into the mortgage industry, was removed from the committee negotiating a nationwide settlement with the lenders.
Iowa Attorney General Tom Miller, who is leading the committee, said Schneiderman "actively worked to undermine" its effort.
From Legal Newsline: Reach Jessica Karmasek by email at firstname.lastname@example.org.
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