SEC Rules Banks Must Allow Audit of Foreclosure Practices

New York City Comptroller John Liu announced this week a victory for the members of the New York City Pension Funds who have long been calling for banks to conduct an independent audit of their mortgage foreclosure practices.

The NYC Pension Funds called for an audit of the banks' practices in ""November"":http://dsnews.comarticles/new-york-city-comptroller-requests-banks-perform-independent-audit-2010-11-19 and again in ""January"":http://dsnews.comarticles/new-york-city-comptroller-issues-second-request-for-disclosure-from-banks-2011-01-11 to no avail,

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but this week the Securities and Exchange Commission (SEC) ruled that the request from the shareholders must be upheld.

""Bank of America"":http://www.bankofamerica.com and ""Citigroup"":http://citigroup.com will have to put the group's request on the ballot at their annual shareholder meetings this spring. ""Wells Fargo"":http://wwww.wellsfargo.com never contested the group's request and already agreed to put the request on their ballot.

""JP Morgan Chase"":http//www.jpmorganchase.com argued that another group of shareholders had already filed a similar request for an audit and was allowed to remove the NYC Pension Fund's request from its spring agenda.

""An independent examination of bank foreclosure practices is needed to reassure shareholders and protect pensioners and taxpayers,"" Comptroller Liu said. ""The necessity for this becomes even clearer as the weeks and months tick by and more New Yorkers face losing their homes to foreclosure. Regrettably, the banks have failed us on this and even went so far as to try and kick us off the ballot, but the shareholders have prevailed.""