NEW YORK – Ex-Federal Deposit Insurance Corp. Chairman Sheila Bair is a top candidate among state officials to ensure banks comply with any settlement of a nationwide foreclosure probe, a person familiar with the matter said.
Bair, who led the FDIC from 2006 until this year, is supported by some states as a third-party monitor of any accord with mortgage servicers including Bank of America, though Citigroup opposes her selection, said the person. Selection of a monitor is one of the final issues to be worked out between the banks and state and federal officials, said the person and one other also familiar with the talks. Both declined to be identified because the negotiations are secret.
Bair, 57, now a senior adviser to the Pew Charitable Trusts, was approached about the job two months ago and turned it down, according to a third person who is familiar with the matter. She declined in part because of a book manuscript she is writing that is due in a few months, said the person, who asked not to be identified because the inquiry was private.
All 50 states last year said they were investigating bank foreclosure practices following disclosures that the companies were using faulty documents in seizing homes. State and federal officials leading the talks are seeking an agreement that provides mortgage relief to homeowners and sets standards for foreclosure practices.
The monitor would ensure compliance with any agreement, according to a settlement proposal offered to the banks. The position will include authority to access records and audit a servicers performance. Banks would be subject to penalties for failure to meet performance measures and timelines.