There was plenty of fanfare last August when Bank of America agreed to a record $16.7 billion settlement with the Justice Department over dubious mortgage practices. But now that the settlement has faded from the public eye, questions are arising about whether the promised assistance is actually getting to the right people and whether the bank will be allowed to claim credit for consumer relief that far exceeds its actual value, the New York Times reported today. As outlined in the settlement, Bank of America is required to make a wide array of loans more affordable for borrowers. The bank was expected to forgive or reduce the amounts owed on the first and second mortgages it held. In exchange, the bank would receive credit for these reductions in dollar amounts outlined in the settlement. Eric D. Green, a retired Boston University law professor, is the independent monitor charged with overseeing Bank of America’s performance under the settlement. He is responsible for validating the bank’s claims for credit under the consumer assistance part of the agreement. Green, who has served as a court-appointed mediator and special master in hundreds of cases, said the bank had not yet submitted claims for credit under the settlement. “We are working out the definitions and methodology of checking the credits the bank seeks,” Green said. Loans that have been discharged in bankruptcy will not be acceptable for credit, he said.
