Big banks must clean up their mess
June 17th, 2014
“Hannah Senft, Candy Savannah and Ron Taylor have been neighbors for more than 20 years in Georgetown South, a community of 800 town homes in Manassas, Virginia. It’s a diverse, working-class suburban neighborhood about 30 miles from the White House.”
“And it’s being decimated.”
Thus begins a powerful Op Ed calling for requiring banks to rebuild communities they destroyed through predatory loans and resulting foreclosures published today in the The Hill, a daily newspaper/On-Line news site read extensively by Congress, their staff, and other Federal officials. The Oblate JPIC Office has been working with VOICE to try to get JP Morgan to agree to participate in the rebuilding of the devastated Northern Virginia communities.
The Op Ed details the suffering still experienced by communities hit by numerous foreclosures, but says: “… there is a sliver of hope: In November 2013, the U.S. Department of Justice (DOJ) secured a $13 billion settlement from J.P. Morgan Chase over its issuance of toxic mortgage-backed securities, including $4 billion for consumer relief. VOICE worked with Sen. Mark Warner (D-Va.), federal officials and other allies to include an option in the settlement for the bank to fulfill this obligation through grants to capitalize community equity restoration funds.”
“As a result, JP Morgan recently pledged $100 million over five years to help Detroit. This is a good start, but it’s far from enough. JP Morgan entities made $117 billion in predatory loans in the U.S. and had $300 million in foreclosures in Prince William County [Virginia] alone.”
“We cannot depend on the altruism of banks to rebuild our communities. J.P. Morgan and other lenders should be required to reinvest at a scale equivalent to the harm they caused.”
“DOJ is using the J.P. Morgan settlement as a template to pursue $50 billion in future settlements from other banks. Attorney General Eric Holder and Deputy Attorney General Tony West must make capitalizing a $5 billion National Community Equity Restoration Fund mandatory under all future settlements.These funds would be directed to cities and suburbs hardest hit by foreclosure to redevelop blighted neighborhoods, to buy back homes with distressed loans in danger of foreclosure, and to build new homes to give a second chance at the American dream to families whose homes were taken from them by the banks.”
“VOICE has already secured $30 million in commitments from Bank of America, General Electric and the Virginia Housing Development Authority to rehabilitate blighted properties and develop new housing in neighborhoods like Georgetown South. To date, J.P. Morgan Chase has refused to participate.”
“Used properly, the DOJ settlements create a powerful opportunity to help rebuild devastated communities like Georgetown South and others nationwide and to find justice for the millions of Ron’s still struggling. The question is: Will President Obama and Attorney General Holder compel bankers to really clean up their mess?”
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Related keywords: financial crisis, jp morgan chase, sub-prime mortgages
