The Treasury rewards JPM, BOA, and Wells Fargo for fraud in the home modification nightmare known as HAMP by merely delaying their bonus incentive payments by a few months.
Nothing to see here...move along.
The Treasury Department is restoring permanent Home Affordable Modification Program payments to JPMorgan Chase.
Early last year, the Treasury reviewed past grievances such as lost paperwork, poor borrower responses, improper evaluations, and others.
The three largest servicers Bank of America, Chase and Wells Fargo needed substantial improvement under HAMP, and the Treasury temporarily withheld incentive payments to each.
Wells was the first lender to earn back its payments early in 2011, followed by BofA in the third quarter. According to the fourth-quarter report released Friday, the Treasury said Chase finally made enough improvements. As a result, the withheld payments will be restored.
The Treasury will give back $89.1 million to Chase withheld since June 2011. BofA received $81.7 million in HAMP payments back for rebounding in the third quarter report.
"Today the Treasury made it official that no bank will ever be penalized for the almost limitless misconduct committed under this program," said former Special Inspector General for the Troubled Asset Relief Program Neil Barofsky in an interview with HousingWire. "They've sent a disgraceful message."..
Barofsky, now a senior fellow at New York University, said not even Schneiderman has the authority to go after HAMP violations, which he saw often while in charge of SIGTARP.
"If they violated contracts with the Treasury, then only the Treasury will be able to go after them," Barofsky said. "But by not enforcing any rules under the program, they've created the ultimate moral hazard."
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