Big banks declare moratorium, file 25 new Cuyahoga foreclosures on same day
Last Friday, February 13, Citigroup issued a press release that said:
To reiterate the commitment made by Chief Executive Officer Vikram Pandit to the House Financial Services Committee on February 11, 2009… Citi has initiated a foreclosure moratorium on all Citi owned first mortgage loans that are the principal residence of the customer as well as all loans Citi services where we have reached an understanding with the investor. The moratorium is effective February 12, 2009, and will extend until President Barack Obama has finalized the details of the loan modification program or March 12, 2009, whichever is earlier. The company will not initiate or complete any new foreclosures on eligible customers during this time.
Within hours the news of Citi’s “foreclosure moratorium” was being broadcast across the globe by CNN, Reuters, Bloomberg, Forbes, the Wall Street Journal, the AP, etc.
Apparently, however, it didn’t reach the ears or inboxes of Citimortgage’s attorneys in Ohio… who filed nine new foreclosure cases Friday in Cuyahoga County Common Pleas Court, including at least three against apparent owner-occupants.
Local law firms representing JP Morgan Chase, Bank of America and Wells Fargo seem to have experienced similar communication difficulties. By Friday these banks all released statements similar to Citi’s, including a letter sent Thursday by JP Morgan CEO Jamie Dimon to House Financial Service Committee Chairman Barney Frank. Yet on that same day, according to the Common Pleas Court docket, lawyers for all three filed went ahead and filed new foreclosure cases in Cuyahoga County — including cases against owner-occupied homes.
The Court’s online docket shows a total of 56 foreclosures filed on Friday. In addition to Citimortgage’s nine, they include nine on behalf of Bank of America (including subsidiaries Countrywide and Lasalle); six on behalf of Wells Fargo/Wachovia; and one on behalf of Chase Financial, an arm of JP Morgan. That’s 25 out of the day’s 56 foreclosure cases, filed by the same four banks whose executives spent the day telling reporters about their new “moratorium”.
Having spent a couple of hours checking each case through public records and the phone book, I think I can say with confidence that at least ten of those 25 cases (and at least one for each of the banks) is a foreclosure on an owner-occupied home.
Well. The court’s closed today for the holiday, but tomorrow it’ll be business as usual at the Clerk’s counter. Plus it will be Sheriff’s sale day (with at least eleven Wells Fargo cases still listed for auction, seven from Citimortgage, and six from BOA/Countrywide). So by Wednesday we should have a pretty clear idea what this “moratorium” is worth.
Stay tuned. Meanwhile I strongly recommend this Business Week article (h/t Ed Morrison at BFD).