Stop Settlement Slush Funds Act of 2016

Floor Speech

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Mr. ELLISON. Mr. Chair, I rise today in opposition to this bill. I offered an amendment to rename it Another Wall Street Request to Avoid Accountability for Fraud. But, my amendment for a more accurate title was not accepted.

Today, the majority wants to defund the organizations and attorneys that help people have a fighting chance against deep-pocketed multi- national corporations and banks.

Mr. Speaker, Congress returns after a seven-week district work period. During that time, I held many constituent meetings. Not one person asked me to weaken regulations on hedge fund managers or Wall Street bankers. And yet, Wall Street requests are what the majority prioritized for our first week back.

This bill would defund the network of housing counselors and legal aid attorneys who help homeowners facing foreclosure.

Homeowners who were tricked into buying a home with teaser rates that exploded into unaffordable payments.

Homeowners who deserved a chance to catch up after a missed payment or two but were unable to get a response from their lender.

And homeowners like Alan Schroit. Alan, a retired cancer researcher, visited his rental house in Galveston, Texas. He found the locks had been changed, the electricity shut off and a notice on the door said Bank of America was foreclosing on his home. Alan did not have a mortgage with Bank of America. Alan didn't even have a mortgage. His home was paid off. It took him 30 days to get someone at Bank of America to call him back.

Homeowners like Nilly Mauck who lost all her possessions when a company mistakenly evicted her instead of her neighbor.

Or homeowners like Charlie and Maria Cardoso who bought their retirement home with cash in 2005. While they continued living in their primary home, they rented their retirement home out. Their tenants came home one day to find the house cleared of all the possessions--again by Bank of America.

Nilly, Alan and Charlie and Maria's foreclosures were some of thirteen million between 2006-2010. Far too many of them were fraudulent, people foreclosed on by firms who did not have clear title to the property. A significant number of these foreclosures could have been prevented if the lenders involved had followed the law. The new book, Chain of Title, by David Dayen reports that across our nation, homeowners who should have received assistance with a loan modification, or allowed to cure a delinquency, instead were hit with outrageous late fines, sold over-priced forced-placed insurance, punished with monthly property inspection and other junk fees. Using robo-signing, their eviction papers were signed by people who had no ownership of the loan.

Congress and the states demanded change. Legal settlements pursued by the Department of Justice, the Department of Housing and Urban Development, the banking regulators and the states made sure that people have a fighting chance against deep-pocketed multi-national corporations.

And yes, to correct this massive wrongdoing required that Bank of America, JPMorgan Chase, Citigroup, Ally Financial and others pay fines. Some of those fines supported nonprofit agencies who knew how to get banks to respond to homeowners and follow the law. The funds supported legal aid attorneys who knew how to ensure the banking doing the eviction actually had a right to the property. When lenders foreclose on the wrong people, or lie about their ownership of a mortgage, there should be consequences.

When we require banks to fund housing counseling and legal aid agencies, we leveled the playing field. We realized it was unfair to require each individual person to figure out the unresponsive, complicated and too often predatory home mortgage market on their own.

I oppose gutting initiatives to help homeowners, small business owners and families do battle with global corporations who have defrauded them out of their home or business, polluted their water or land or harmed their health.

Therefore I will oppose H.R. 5063.

I urge my colleagues to do the same.

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