(Bloomberg) -- HSBC Holdings Plc will pay $32.5 million to settle claims that it failed to follow a U.S. regulator's orders to improve mortgage foreclosure practices that led to borrowers being harmed after the 2008 credit crisis.
The Office of the Comptroller of the Currency levied the fine after concluding that HSBC is now in compliance with the agency's orders going back to 2011. The London-based bank was one of many big U.S. mortgage servicers that reached agreement with regulators to review problems that led to borrowers facing improper foreclosures.
“We're pleased with the OCC's assessment of the enhancements we've made to mortgage servicing over the last several years,” Rob Sherman, an HSBC spokesman, said Monday in an e-mailed statement. The bank is now “more compliant and customer-friendly,” he said.
The OCC had accused HSBC in 2015 of failing to meet the demands it had agreed to, and the agency imposed some additional restrictions on the company's mortgage-servicing abilities until it fixed its shortcomings. The regulator also noted Monday that HSBC failed to properly file documents in bankruptcy cases after the orders, and the bank had to pay $3.5 million in remediation to borrowers.
HSBC was the last of the banks under OCC foreclosure orders. Wells Fargo & Co. paid $70 million in a similar settlement last year, and U.S. Bancorp paid $10 million. A subsidiary of Fidelity National Financial Inc. is in final talks to pay as much as $65 million to resolve its role in improper foreclosures, a person familiar with the talks has said, specifically the involvement of a firm bought by Fidelity National formerly known as Lender Processing Services Inc.
To contact the reporter on this story: Jesse Hamilton in Washington at jhamilton33@bloomberg.net. To contact the editors responsible for this story: Jesse Westbrook at jwestbrook1@bloomberg.net, Gregory Mott, Justin Blum
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