WASHINGTON Jan 5 A U.S. congressional oversight
panel asked regulators to delay a multibillion dollar mortgage
settlement with 14 large banks so that the lawmakers could
review the deal, according to a letter made available on
"We would like more information about how the potential
settlement amount is to be determined in light of the potential
wrongdoing identified to date," said the Jan. 4 letter to
Federal Reserve Chairman Ben Bernanke and the Comptroller of the
Currency Thomas Curry.
The top Republican and Democratic lawmakers on the House of
Representatives Oversight Committee asked regulators how aid may
be distributed and in what form, and what may happen to
homeowner files that are still awaiting review.
The Wall Street Journal reported that the Federal Reserve
was holding up the settlement with banks to resolve allegations
that they unlawfully cut corners when foreclosing on delinquent
The settlement with five big banks - Bank of America
, Wells Fargo & Co, JPMorgan Chase & Co,
Citigroup Inc and Ally Financial - would be part of a
larger deal that the Office of the Comptroller of the Currency
hopes will include 14 banks and total about $10 billion, a
source told Reuters last week.
The deal would potentially compensate borrowers who went
through foreclosures in 2009 and 2010, and it was unclear why
the Fed had not signed off on it, the Journal said.
The terms under discussion would have 14 large banks pay a
total of $3.75 billion in cash and the balance in other forms of
borrower relief, the newspaper reported, citing people familiar
with the matter.
Spokesmen for the Fed and the OCC were not immediately
available for comment.
The Fed and the OCC have disagreed about exactly how
payments to consumers under the settlement would be determined,
the Journal said. Smaller banks that were concerned that the
settlement terms favor larger lenders also opposed the deal, the
A majority of the 14 servicers have already agreed to the
terms of the deal, which would be in jeopardy if it is not
completed this weekend, the Journal said.