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Sunday 31 August 2014

HSBC payout over US house seizures

Published 18/01/2013 | 20:36

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HSBC has reached a deal to settle complaints that its US division foreclosed on homeowners who should have been allowed to stay

HSBC will pay 249 million US dollars (£156 million) to settle federal complaints that its US division wrongfully foreclosed on homeowners who should have been allowed to stay in their homes.

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The agreement with the Federal Reserve and the Office of the Comptroller of the Currency is similar to deals with 12 other banks that ended a review of loan files required under a 2011 federal action. Combined, the 13 banks will pay 9.3 billion dollars (£5.8 billion).

The settlements could compensate Americans whose homes were seized because of abuses such as "robo-signing", when banks automatically signed off on foreclosures without properly reviewing documents. The agreement will also help eliminate huge potential liabilities for the banks.

Consumer advocates say regulators settled for too low a price.

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