Former President Bill Clinton Referred to the Persisting Foreclosure Crisis as a Choking Chain Round the Neck of America
The biggest challenges Bank of America is currently facing are two – restoring its public image and dealing with the myriad of residential mortgages. Five years have passed since the housing crash and the bank is now facing billions of dollars in possible damages to be paid from investments that turned sour, claims McCarthy Lawyer Links, a consulting legal firm. Lawsuits against the bank kept on piling up. Most of these have been carried over from Countrywide – a financial unit that BofA took over after its financial collapse.
The face behind Bank of America’s image rebuilding operations is Anne Finucane. She handles problems relating to the reputation of the bank and not about legal decisions or banking. When she got the feeling that the public was becoming annoyed towards the bank, she started working with Brian Moyniahn (CEO) to erase fees from overdraft fees issued to the bank’s customers during a certain period. Following the introduction of more financial regulations, other banks trod the same path, albeit not as strongly. Last autumn, however, Finucane and her bank stumbled by introducing plans for the imposition of monthly fees of $5 on clients using a debit card for buying. It battered the public image of the bank at a critical point in time and the bank hastily withdrew this plan.
Last December, former president Bill Clinton raised the issue of the foreclosure crisis at a private meeting. He had words of praise for the efforts of BofA to make affordable terms of mortgage for some of the troubled house owners; he referred to the persisting foreclosure crisis as a choking chain round the neck of America. He said, “We’ve got to do something to clean these books up, and to do it in a hurry, in my opinion. I still think that’s the single most important thing we could do to loosen everyone up, go back to a free-market, full-employment economy and have the normal transactions occurring again”.
Finucane stated that she couldn’t agree more with him. Although early in life she did not show any penchant for banking, in 1995 she took up a job with Fleet Financial; she became its head in corporate matters as well as in marketing. She soon realized how risky irresponsible lending could turn out to be. The risky and costly mortgage loans that Fleet had purchased started going south, ultimately leading to regulators of the Georgiasuing Fleet to accuse Fleet Financial of predatory lending. In order to settle the lawsuit, Fleet had to pay over $100 million.
