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Don’t end banks’ liability over foreclosures, Minn. official urges

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Minnesota Attorney General Lori Swanson has joined a vocal group of peers urging state and federal officials to resist giving banks broad legal liability as they negotiate a multi-billion dollar settlement over shoddy foreclosure practices.

“The banks should not be released from liability for conduct that has not been investigated and is not appropriately remedied in any settlement,” Swanson wrote in a letter sent to counterparts in numerous states, including Iowa Attorney General Tom Miller, who is leading the talks along with Thomas Perrelli, a top Justice Department official.

Specifically, Swanson echoed calls from other attorneys general, particularly those in New York and Delaware, who have insisted that any settlement over flawed foreclosure paperwork not release banks from separate claims over how they bundled and sold mortgages to investors. Miller has said he is working to craft a narrow release in the ongoing settlement talks and doesn’t intend to let banks off the hook for their securitization practices.

“We share a lot of common ground with Attorney General Swanson,” Miller spokesman Geoff Greenwood said Tuesday. “We appreciate her input.”

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