(Washington, DC - July 14, 2011) Congressman John Yarmuth (KY-03) called on his colleagues in the House Oversight and Government Reform Committee to take immediate steps to investigate illegal foreclosures on active duty members of the military. During a hearing of the committee featuring testimony from consumer advocate Dr. Elizabeth Warren, Congressman Yarmuth told the story of Chief Warrant Officer Charles Pickett. While serving in Operation Iraqi Freedom, Bank of America attempted to illegally foreclose on CWO Pickett’s home three times, even though he was current on his mortgage.
“While the men and women of our military bravely serve our country in battle overseas, they shouldn’t have to fight banks here at home trying to illegally evict their families and seize their homes,” said Congressman Yarmuth. “We need to investigate and end this reprehensible practice now.”
Yarmuth heard from Pickett during a joint forum on Tuesday held by Members of the House Oversight Committee and the Senate Commerce, Science, and Transportation Committee. Today, Yarmuth conveyed Pickett’s story to Dr. Warren, the consumer advocate selected by President Obama to establish the Consumer Financial Protection Bureau, asking Warren about the role that new agency can have in stopping this illegal practice.
From 2009 to 2011, Bank of America attempted to foreclose on CWO Pickett’s home on three separate occasions while he was deployed in Iraq and current on his mortgage payments. After two years of legal wrangling, Pickett was ultimately successful in halting foreclosure, though his credit was damaged and a line of credit he had previously obtained was closed.
It is estimated that thousands of members of the military have illegally faced foreclosure or have been overcharged by lenders in violation of the Servicemembers Civil Relief Act of 2003. Earlier this year, JP Morgan Chase, Morgan Stanley, and Bank of America paid millions in settlements to thousands of servicemembers who were wrongfully foreclosed on.
Democratic members of the Oversight Committee have requested further investigations into allegations of wrongful foreclosure by ten mortgage servicing companies.
“It’s easy to put out of sight what the real implications are of these financial misdeeds on military readiness. The number one reason for losing security clearance in the United States now is a problem over credit,” said Dr. Warren. “Servicemembers who are deployed abroad have talked to us multiple times about what it means to try to fight a war on two fronts – one in a foreign location and one back at home to try to take care of their family. This is wrong.”