Hard to Believe, but Treasury May Actually Fine Banks

The Washington Post is reporting that the Treasury will announce that it is withholding payments from Bank of America, Wells Fargo and Chase for failing to meet the basic requirements of the federal foreclosure prevention program.

For more than two years these big banks have strung homeowners along, forcing them to submit paperwork over and over, putting them on hold for hours, leaving them in limbo for months and ultimately denying hundreds of thousands of families a chance to hold onto their homes.

Here is a letter PICO National Network sent to Secretary Geithner 16 months ago demanding financial penalties against Bank of America. In the wake of receiving billions in taxpayer bailouts, each bank signed an agreement with the Treasury promising to offer loan modifications to eligible families. Instead they have chosen to run foreclosure mills. That's why only four percent of the money set aside to help struggling families avoid foreclosure has been spent.

Fines are a long overdue start in creating real accountability over the big banks, but Treasury needs to do a lot more to really staunch the flow of foreclosures.