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Consent Order_us Bank Na

Consent Order_us Bank Na

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Categories:Types, Business/Law
Published by: Michael Alex Wasylik on Apr 17, 2011
Copyright:Attribution Non-commercial


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In the Matter of:
))U.S. Bank National Association ) AA-EC-11-18Cincinnati, Ohio )and )U.S. Bank National Association ND )Fargo, North Dakota ))
The Comptroller of the Currency of the United States of America ("Comptroller"),through his national bank examiners and other staff of the Office of the Comptroller of theCurrency ("OCC"), as part of an interagency horizontal review of major residential mortgageservicers, has conducted an examination of the residential real estate mortgage foreclosureprocesses of U.S. Bank National Association, Cincinnati, Ohio and U.S. Bank NationalAssociation ND, Fargo, North Dakota (collectively, "Bank"). The OCC has identified certaindeficiencies and unsafe or unsound practices in residential mortgage servicing and in the Bank’sinitiation and handling of foreclosure proceedings. The OCC has informed the Bank of thefindings resulting from the examination.The Bank, by and through its duly elected and acting Board of Directors ("Board"), hasexecuted a "Stipulation and Consent to the Issuance of a Consent Order," dated April 13, 2011(“Stipulation and Consent”), that is accepted by the Comptroller. By this Stipulation andConsent, which is incorporated by reference, the Bank has consented to the issuance of thisConsent Cease and Desist Order ("Order") by the Comptroller. The Bank has committed totaking all necessary and appropriate steps to remedy the deficiencies and unsafe or unsound
practices identified by the OCC, and to enhance the Bank’s residential mortgage servicing andforeclosure processes. The Bank has begun implementing procedures to remediate the practicesaddressed in this Order.ARTICLE ICOMPTROLLER’S FINDINGSThe Comptroller finds, and the Bank neither admits nor denies, the following:(1) The Bank is among the largest servicers of residential mortgages in the United Statesand services a portfolio of 1,400,000 residential mortgage loans. During the recent housingcrisis, a large number of residential mortgage loans serviced by the Bank became delinquent andresulted in foreclosure actions. The Bank’s foreclosure inventory grew substantially from 2008through 2010.(2) In connection with certain foreclosures of loans in its residential mortgage servicingportfolio, the Bank:(a) filed or caused to be filed in state and federal courts affidavits executed by itsemployees making various assertions, such as the amount of the principal and interest due or thefees and expenses chargeable to the borrower, in which the affiant represented that the assertionsin the affidavit were made based on personal knowledge or based on a review by the affiant of the relevant books and records, when, in many cases, they were not based on such personalknowledge or review of the relevant books and records;(b) filed or caused to be filed in state and federal courts, or in local land recordsoffices, numerous affidavits that were not properly notarized, including those not signed oraffirmed in the presence of a notary;2
(c) failed to devote to its foreclosure processes adequate oversight, internalcontrols, policies, and procedures, compliance risk management, internal audit, third partymanagement, and training; and(d) failed to sufficiently oversee outside counsel and other third-party providershandling foreclosure-related services.(3) By reason of the conduct set forth above, the Bank engaged in unsafe or unsoundbanking practices.Pursuant to the authority vested in him by the Federal Deposit Insurance Act, asamended, 12 U.S.C. § 1818(b), the Comptroller hereby ORDERS that:ARTICLE II
(1) The Board shall maintain a Compliance Committee of at least three (3) Bank orHolding Company directors, of which at least two (2) may not be employees or officers of theBank or any of its subsidiaries or affiliates. In the event of a change of the membership, thename of any new member shall be submitted to the Examiner-in-Charge for Large Bank Supervision at the Bank (“Examiner-in-Charge”). The Compliance Committee shall beresponsible for monitoring and coordinating the Bank’s compliance with the provisions of thisOrder. The Compliance Committee shall meet at least monthly and maintain minutes of itsmeetings.(2) Within ninety (90) days of this Order, and within thirty (30) days after the end of each quarter thereafter, the Compliance Committee shall submit a written progress report to the3

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