The “settlement agreement” between state attorneys-general, the Obama Administration and five large banks over unlawful home foreclosures was front-page news everywhere this morning. Only one problem: you can’t get a copy of the agreement itself. All we have is a few hand picked details promising “relief” to defrauded borrowers, and pledges by the banks that they’ll obey the law from now on.
Check out the special web site, which proudly trumpets the “landmark settlement,” the “historic”agreement and the “landmark relief,” but offers only a factsheet entitled “Servicing Standards Highlights” that purports to summarize the deal, and a bunch of phone numbers for the banks and the AGs.
Everything else is “coming soon.”
This is an outrage, and frankly, the news media and all the rest of the pundits out there ought to have demanded the full and complete document before heralding the settlement as a major event. To my astonishment, most of the reports I read today failed to note that the actual settlement agreement has not been released to the public.
Ever heard of the lawyer’s favorite maxim, “the devil’s in the details”? The banks here were accused of failing to comply with legal technicalities like proving that they actually held the mortgage to the homes they foreclosed on. When it comes to themselves, the bankers know those details matter: You can be sure that their lawyers have negotiated and reviewed every single comma. Shouldn’t American taxpayers and homeowners, who have borne the terrible brunt of these banks’ gross irresponsibility and greed for the last three years, had a chance to review the proposal before our elected officials signed on the dotted line?
I’ve seen this kind of stunt many times before – for example, a settlement of a lawsuit that was described by the parties in a press release as returning $500 million in overcharges to insurance customers. Months later, the settlement agreement itself is quietly filed with the court, and surprise! You had to fill out a ten page claim form to get your money, and the insurance company got to keep whatever’s left. (As a lawyer for one of the policyholders, I joined with Consumer Watchdog in an objection to the settlement.)
It is no little irony that many people lost their homes because they didn’t read the fine print of the loans, or couldn’t understand what it meant. But when it comes to the settlement of the fiasco, no one can read it even if they want to. We have nothing in print, fine or otherwise, beyond the press materials.
Remember you heard it first here: there’ll be lots of surprises when we finally get to look at the details of this deal.