Coalition Asks Banks to Come Clean
A coalition of seven public pension systems called on several of the nation’s largest banks to immediately undertake independent examinations of their mortgage and foreclosure practices, including their loan modification and foreclosure and securitization procedures.

The coalition, which represents about $5.7 billion in pension investments in the banks, has become increasingly concerned about the ongoing foreclosure crisis. They have requested reviews from Bank of America, Citigroup, JP Morgan Chase, and Wells Fargo, and have asked the banks to report their findings in their 2011 proxy statements this spring.

"The banks' boards cannot continue to pretend the foreclosure mess is the result of technical glitches and paperwork errors," says New York City Comptroller John C. Liu, on behalf of the coalition of five New York City Pension Funds. "There is a fundamental problem in their procedures that endangers not just home owners, but shareholders, and local economies.”

Echoing those statements, New York State Comptroller Thomas P. DiNapoli said in a public statement issued about the coalition’s request that "millions of families have lost their homes, and the investments of the million members of the Common Retirement System have been put at risk. As investors, we need to understand what happened. A full and open examination of the procedures used to foreclose on millions of families is the only way to make sure our investments are protected and no one is ever wrongfully evicted from their home."

The Congressional Oversight Panel estimates that banks' potential mortgage liability could total $52 billion, which largely encompasses the four banks the coalition has contacted.

Source: “Press Release: $432 Billion Pension Fund Coalition Demands Bank Directors Examine Foreclosure Practices,” Dow Jones Business News (Jan. 9, 2011)