HSBC to pay $470 million for mortgage abuses

The U.S. Department of Justice announced on Friday, February 5, that the Department, the Department of Housing and Urban Development, the Consumer Financial Protection Bureau and the attorneys general of 49 states and the District of Columbia reached a $470 million agreement with HSBC Bank USA NA and its affiliates (collectively, HSBC) to address mortgage origination, servicing and foreclosure abuses.

In conjunction with that agreement, the Board of Governors of the Federal Reserve System announced its assessment of a $131 million penalty against HSBC North America Holdings, Inc., and HSBC Finance Corporation for deficiencies in residential mortgage loan servicing and foreclosure processing. The Board may remit (cancel) up to the full amount of this penalty to the extent HSBC satisfies the Department of Justice settlement or by providing funding for nonprofit housing counseling organizations. If HSBC does not satisfy the full $131 million penalty amount within two years, the remaining amount must be paid to the U.S. Department of Treasury.

See our Penalty Page entry for additional details.