State attorneys general and federal officials held an all-day negotiating session Wednesday on the nation's foreclosure crisis with five of the nation's largest banks, seeking to resolve allegations of wrongdoing that law enforcement officials say have impacted millions of Americans facing foreclosure.
Iowa Attorney General Tom Miller called the meeting at the Justice Department "a good first step" in bringing about changes in foreclosure practices, but Miller said the two sides have a long way to go.
In brief remarks to reporters, Miller declined to say whether the participants focused on possible fines or monetary penalties on the banks.
"It was far-ranging and productive," Miller said of the discussion. State attorneys general from Delaware, Virginia, North Carolina and Illinois also were participants, along with representatives for 10 other state attorneys general.
The Justice Department and Miller are spearheading a coordinated law enforcement effort to ensure that large mortgage services work with borrowers to find alternatives to foreclosure. The five banks participating in Wednesday's talks were Bank of America, Wells Fargo, Citibank, Chase and GMAC.
Associate Attorney General Tom Perrelli and Miller have been leading talks with the banks since last fall on the extent to which financial institutions have been using flawed documents to foreclose on some home borrowers.
Federal investigators and the offices of state attorneys general have been looking into the filing of false affidavits in foreclosures and the practice of financial institution employees engaging in robo-signing, that is, approving documents in foreclosures without reading them.
Foreclosure-fraud class action lawsuits are piling up against major banks across the U.S. The class actions, which could be expanded nationally, seek damages for homeowners whose properties were illegally foreclosed upon by banks using fraudulent documents.
Perrelli and Miller led the discussions at the Justice Department.