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Aaron Glantz

Kamala Harris Subpoenas Fannie, Freddie

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By |November 17, 2011 5:06 p.m. |In Housing

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Aaron Glantz/The Bay Citizen
Attorney General Kamala Harris
The LA Times reports that investigators from the California attorney general's office have subpoenaed information from mortgage titans Fannie Mae and Freddie Mac as part of a wide-ranging inquiry into lending and foreclosure practices in the state.
Harris, San Francisco's former District Attorney, has made mortgage fraud one of the hallmarks of first year in office -- launching a Mortgage Fraud Strike Force, prosecuting attorneys who scam troubled homeowners, and walking away from the table in national settlment talks with the nation's largest banks because she thought the demands of other states were too weak.
Shum Preston, a spokesman for the California attorney general, said he could not confirm the LA Times report, which cited "a person familiar with the matter" in reference to the subpoenas:
The subpoenas ask the government-controlled finance companies to answer a series of questions about their activities in California, including their roles as landlords who own thousands of foreclosed properties. The attorney general's office is also seeking details of Fannie and Freddie's mortgage-servicing and home-repossession practices, according to a person familiar with the matter.In addition, investigators want to learn more about the companies' purchases and sponsorship of securities holding "toxic mortgages" in the Golden State, said the person, who was not authorized to speak on the matter and requested anonymity.
Fannie and Freddie own approximately 70 percent of all home loans in the United States and have emerged as a major roadblock for homeowners seeking to work with banks to write down the principal on loans for underwater borrowers.
Community groups immediatley cheered the move. In a statement, the non-profit California Reinvestment Coalition said "Fannie and Freddie have refused to update policies that would help homeowners at risk of foreclosure and tenants at risk of eviction to stay in their homes."
In addition to praising Harris, the coalition also called on the Federal Housing Agency, which regulates Fannie and Freddie, to "take heed immediately and adopt practices that help people prevent foreclosure and stay in their homes."
Aaron Glantz
Aaron Glantz covers housing, real estate, development, and veterans issues for The Bay Citizen. Before joining TBC, Glantz spent seven years covering the war in Iraq and the treatment veterans receive when they come home. ... View Profile
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