Goldman and Morgan Stanley reach $557M deal in “robo-signing” case

New York /
Jan.January 16, 2013 02:00 PM

Goldman Sachs and Morgan Stanley will shell out a combined $557 million to settle the federal government’s allegations that the banks foreclosed on homeowners who should have been allowed to stay in their homes, the Associated Press reported. The deal, announced today with the Federal Reserve, could compensate hundreds of thousands of homeowners who fell victim to “robo-signing,” when banks signed off on foreclosures without proper review.

About $232 million of the settlement funds will go to homeowners who faced foreclosure in 2009 and 2010; about 220,000 are eligible. The rest will be directed toward reducing mortgage balances and pardoning outstanding principal owed on houses that were sold for less than what mortgage borrowers owed.

Today’s deal is similar to one struck last week to the tune of $8.5 billion with Bank of America, JPMorgan, Wells Fargo and others. This group of banks will shell out $3.3 billion to nearly 4 million homeowners to end foreclosure review, with the remainder directed to mortgage modifications and principal forgiveness. [AP via Crain’s]Zachary Kussin


Related Articles

arrow_forward_ios
Morgan Stanley inks massive lease at Fisher Brothers’ Park Avenue Plaza
Morgan Stanley inks massive lease at Fisher Brothers’ Park Avenue Plaza
Morgan Stanley inks massive lease at Fisher Brothers’ Park Avenue Plaza
Morgan Stanley's John Klopp and Global Student Accommodation's Nicholas Porter (Morgan Stanley, GSA)
Morgan Stanley targeting student housing rebound with joint venture
Morgan Stanley targeting student housing rebound with joint venture
BRP Companies Gets $290M from Goldman Sachs for Queens Opportunity Zone project
BRP Companies Gets $290M from Goldman Sachs for Queens Opportunity Zone project
BRP Companies Gets $290M from Goldman Sachs for Queens Opportunity Zone project
Goldman Sachs CEO David Solomon and 1 Flatbush Avenue in Brooklyn (Getty, Hillwest, iStock)
Oh, honey: Goldman Sachs to add beehives to real estate assets across U.S.
Oh, honey: Goldman Sachs to add beehives to real estate assets across U.S.
1301 Sixth Avenue and Paramount Group's Albert Behler (Google Maps, Getty)
Wells, Morgan Stanley to provide Paramount’s $860M refi at 1301 Sixth Avenue
Wells, Morgan Stanley to provide Paramount’s $860M refi at 1301 Sixth Avenue
Co-head of Goldman’s Europe Tavis Cannell with the Paris building (Google Maps, Goldman Sachs)
Goldman Sachs spends $119M on Paris office, retail building
Goldman Sachs spends $119M on Paris office, retail building
973 Fifth Avenue and David Leuschen (Google Maps, Riverstone Holdings)
Former Goldman Sachs partner lists Upper East Side townhouse for $80M
Former Goldman Sachs partner lists Upper East Side townhouse for $80M
Entera CEO Martin Kay (Entera, iStock)
Single-family data startup Entera raises $32M
Single-family data startup Entera raises $32M
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...