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Financial Services Law Insights and Observations

Report Claims to Show Widespread Foreclosure Irregularities In San Francisco



On February 15, the San Francisco Assessor-Recorder, Phil Ting, released an audit report conducted by Aequitas that found 84 percent of foreclosures sampled contained at least one violation of California’s foreclosure laws. The Assessor-Recorder argues that the results prove the need for state legislation to provide greater mortgage industry oversight, including legislation to address document recording transparency, dual tracking, and general foreclosure processes. The report sampled 382 foreclosures in San Francisco from 2009 through 2011, finding that 75 percent had a problem with the assignment of the deed of trust and 59 percent had assignments that were filed after the notice of default. The report also alleges findings of other unlawful foreclosure actions or “suspicious activity”, but Mr. Ting stressed that he is not asserting that “every distressed borrower is a victim and that the mortgage industry is collectively guilty of defrauding homeowners.”