AG expands mortgage probe to trustees

TRD New York /
Jun.June 13, 2011 05:56 PM

New York Attorney General Eric Schneiderman is expanding his investigation into the U.S. mortgage industry, having teamed up with Delaware Attorney General Joseph Biden III in requesting information from Deutsche Bank AG and the Bank of New York Mellon about their roles as trustees overseeing mortgage securities for investors. As the New York Times reported, trustees were administrators — not originators or servicers — of the loans, and thus had not previously been under much scrutiny as part of other nationwide investigations into what fueled the industry’s boom and bust. But trustees were supposed to make sure that all documentation was accurate and accounted for — a responsibility that has already been called into question by a probe into shoddy foreclosure practices by some of the nation’s largest mortgage servicers. Those servicers are currently negotiating a settlement with a group of state attorneys general, but if Schneiderman and Biden find that trustees were also falling short on their oversight duties in the securitization process, it could mean even more expensive litigation is on the horizon for big U.S. banks. Bank of New York Mellon and Deutsche Bank were the two largest banks that acted as trustees. [NYT]

Related Articles

Related chairman Stephen Ross with 30 Hudson Yards, 1633 Broadway and 55 Hudson Yards (Credit: Getty Images, Paramount, Wikipedia)

Here were NYC’s largest real estate finance deals of 2019

A&E Real Estate Holdings principal Douglas Eisenberg and the properties (Credit: The Rego Park 18 Portfolio)

Deutsche Bank provided A&E $97M in financing for big Rego Park buy

55 Hudson Yards, Facebook CEO Mark Zuckerberg (Credit: Google Maps and Getty Images)

Here’s how much Facebook is paying at Hudson Yards

Jerry Rotonda (Credit: LinkedIn)

Former Deutsche Bank exec has defaulted on $3M loan, lawsuit says

From left: London, Shanghai and Paris

The TRD weekly global digest

Related CEO Jeff Blau, Deutsche Bank CEO Christian Sewing, and Time Warner Center at 10 Columbus Circle (Credit: Getty Images and Wikipedia)

Deutsche Bank shrinks footprint at future Columbus Circle home amid global downsizing

Have no fear? Debt brokers say Deutsche Bank quelled concerns about real estate lending

Have no fear? Debt brokers say Deutsche Bank quelled concerns about real estate lending

Garth Ritchie (Credit: Getty Images)

Head of Deutsche’s I-banking arm to step down