This agreement holds the banks accountable for their wrongdoing on robo-signing and mortgage servicing. But from the beginning of Attorney General’s involvement in the negotiations, one of the top concerns was to make sure that the settlement did not immunize the banks from liability for other misconduct that may have contributed to the housing bubble and the housing market crash that precipitated the recession. This agreement achieved that goal. Among the critical legal claims the Attorney General fought for, and successfully preserved, this settlement does not:
- Release any criminal liability or grant any criminal immunity
- Release any private legal claims by individuals or any class action claims
- Release legal claims related to the securitization of mortgage backed securities that were at the heart of the financial crisis
- Release claims against Mortgage Electronic Registration Systems or MERSCORP
- End state attorneys general investigations of Wall Street related to financial fraud or the financial crisis.
The agreement settles only some aspects of the banks conduct related to the financial crisis (foreclosure practices, loan servicing, and origination of loans) in return for the second largest state attorneys general recovery in history and direct relief to distressed borrowers while they can still use it.