WASHINGTON (Legal Newsline) – HSBC Bank USA NA and its affiliates settled for $470 million with the Justice Department, the Department of Housing and Urban Development (HUD), the Consumer Financial Protection Bureau and numerous state attorneys general over allegations of mortgage origination, servicing and foreclosure abuses.
“This agreement is the result of a coordinated effort between federal and state partners to hold HSBC accountable for abusive mortgage practices,” Acting Associate Attorney General Stuart F. Delery said. “This agreement provides for $370 million in creditable consumer relief to benefit homeowners across the country and requires HSBC to reform their servicing standards. The Department of Justice remains committed to rooting out financial fraud and holding bad actors accountable for their actions.”
HSBC will provide the monetary relief to consumers as well as provide payment to federal and state parties. It will additionally be bound to mortgage servicing standards. Under the agreement, it has further agreed to allow independent monitoring of its compliance with the agreement.
“Mortgage servicers have a responsibility to help struggling borrowers remain in their home, not to push them into foreclosure,” General Counsel Helen Kanovsky of HUD, said. “This agreement is another example of how multiple agencies in the federal government and state attorneys general across the country are working to make sure the mortgage industry treats consumers fairly.”
The agreement will be filed as a consent judgment in the U.S. District Court for the District of Columbia and resolves potential violations of civil law.