OCC Settles Civil Money Penalties

OCC Settles Civil Money Penalties Against Large National Bank Mortgage Servicers for $394 Million;
Penalty Assessment Coordinated with Servicers' Actions and Payments Under Federal-State Settlement

The Office of the Comptroller of the Currency (OCC) has announced agreements in principle with four large national bank mortgage servicers to settle civil money penalties in connection with the unsafe and unsound mortgage servicing and foreclosure practices that were the subject of comprehensive cease and desist orders issued by the OCC in April 2011.

OCC's announcment involves Bank of America, Citibank, JPMorgan Chase, and Wells Fargo.  The OCC’s actions were announced in coordination with the Board of Governors of the Federal Reserve System and the announcement of the federal-state settlement involving the U.S. Department of Justice, the Department of Housing and Urban Development, other federal agencies, and state attorneys general.

In the agreements in principle struck by the OCC with these mortgage servicers, the servicers do not contest the OCC’s ability to impose penalties aggregating $394 million, and the OCC agrees to hold in abeyance imposition of such penalties provided the servicers make payments and take other actions under the federal-state settlement with a value equal to at least the penalty amounts that each servicer acknowledges that the OCC could impose.  The amounts for each servicer are $164 million for Bank of America, $34 million for Citibank, $113 million for JPMorgan Chase, and $83 million for Wells Fargo.  If after three years, a servicer has not paid an amount equal to its respective penalty, the OCC will assess a penalty against the servicer for the difference between the aggregate value of the actions and payments under the agreement and that servicer’s OCC penalty amount.  Read more.