Thank you for your support of California Reinvestment in 2014

Dear CRC Supporters,

We are writing to thank you for your support during the past year and to ask you to consider supporting CRC’s advocacy in 2015 with a small donation.

Your donation of $25, $50, $75, or more, will power our advocacy on behalf of our members, who are helping people throughout California to buy their first home, set up a matched savings account, open a safe checking account, start a small business, or to live in a home that’s safe and affordable.

To give you an idea of what your donation can do, we’re including a brief recap of the work CRC engaged in during 2014:

1. ATM Fees: In March, CRC released our $19 million ATM fee report, documenting how CalWORKs recipients are losing precious benefit dollars to ATM fees they incur to withdrawal their benefits.  We also sent a letter to regulators (along with 79 of our allies), raising media attention and documenting the many problems the REO to Rental scheme is creating for tenants, first-time homebuyers, and communities.

2. Housing Counselor Survey: In May, CRC’s 10th survey of California housing counselors, which includes 11 stories of homeowners who worked with CRC member Housing and Economic Rights Advocates, was featured on NPR’s Morning Edition. NPR interviewed an Oakland homeowner who faced a number of obstacles in trying to keep her home after the death of her spouse. CRC briefed regulators on the report and survey findings.

3. Payday Lenders: In August, as part of “Shark Week,” CRC and our allies held a rally in front of a San Franciso payday loan store, drawing attention to the harm caused by these loan sharks, and the important opportunity for the CFPB to regulate these loans in 2015.

4. Community Reinvestment Plan: In September, as a result of advocacy by CRC and our members and allies, Banc of California announced a public, five-year community benefit and reinvestment plan as part of its acquisition of 20 Banco Popular branches.

5. Bank Merger: In December, using a Freedom of Information Act request, CRC identified that OneWest bank has already received over $1 billion from the FDIC and expects to receive another $1.4 billion as part of controversial shared loss agreements with the FDIC.  We announced these new findings at a press conference and rally at the bank’s headquarters, and along with our over 50 members and allies, will continue pressing the bank regulators to hold hearings on this proposed Too Big To Fail bank merger.

As you can see, we’ve been busy this year.  If you also believe that banking services should be available to all communities, and that predatory products and services must be eliminated, please consider making a donation to CRC today.

We are a small and nimble organization and your investment allows CRC to amplify the issues faced by our members and their clients to bank regulators, policymakers, the media, and the banks themselves. With your support, CRC members successfully advocate for stronger community reinvestment by the banks and for policies and laws that protect low-income consumers.

Thank you for your support,

The CRC Team

Paulina, Kevin, Liana, Andrea, Sean, Jess, and Divya

Saving Homes in Bankruptcy Webinar on January 13th 2015

The HBOR Collaborative presents a webinar on Saving Homes in Bankrupty on Jan 13, 2015 at 12pm (PST)  Register now: Registration Page

Bankruptcy is one of the most effective tools for preventing foreclosure. From the automatic stay to the ability to cure mortgage arrears, bankruptcy can help save homes. But the power of bankruptcy goes beyond these two critical provisions. Any advocate working to preserve homeownership needs to know what bankruptcy can and cannot do for clients in financial distress. We will highlight the various ways in which bankruptcy can help clients keep their homes.

Presenters: Sarah Bolling Mancini and Tara Twomey, National Consumer Law Center

San Francisco-based housing advocacy center, the National Housing Law Project (NHLP), and its project partners, Western Center on Law & Poverty, the National Consumer Law Center, and Tenants Together (the HBOR Collaborative) provide free assistance to California consumer attorneys on the state’s new Homeowner Bill of Rights (HBOR) and other state and federal foreclosure-related laws. The HBOR Collaborative’s free services include education, advocacy, technical assistance, litigation support, a listserv for attorneys, and extensive web-based attorney resources.

The HBOR Collaborative also provides internet webinars and live trainings in areas throughout California. Past webinar materials are archived on our website. To learn more about California HBOR, access HBOR resource materials, and to register for this and any future trainings, consumer attorneys should go to

Consumer attorneys can also contact HBOR collaborative staff for individual assistance with questions and cases via our webpage,

The HBOR Collaborative and its services, including this free training for attorneys, are funded by a grant from the Office of the Attorney General of California from the National Mortgage Settlement to assist CA consumers.

There is no charge for this webinar.

All time listings are in Pacific (California) time.
1.5 hours of MCLE will be provided by NHLP.

For more information email

After registering, you will receive a confirmation email containing information about joining the webinar.

Community Leaders Hold Press Conference at OneWest Bank Headquarters

OneWest Protest Picture (3)

A large group turned out for press conference and rally today

Earlier today, Los Angeles Community leaders gathered in front of the headquarters of OneWest Bank to share new information about the amount of corporate subsidy OneWest has received from the FDIC.

We want a strong CRA plan

Namoch Sokhom from PACE

Community leaders and affected homeowners called on bank regulators to hold public hearings about the proposed merger of OneWest and CIT Group, and urged the bank leadership to implement a moratorium on foreclosing on widowed homeowners whose deceased spouses had reverse mortgages.

TARP bailout Checks

$2.3 billion in TARP for CIT + $2.4 billion in FDIC subsidy for OneWest. Almost $5 billion in subsidy for the two banks!

Kevin Stein, associate director of the California Reinvestment Coalition, comments: “Now we know why the bank CEOs refused to tell us how much they’ve received from the FDIC. This is an embarrassing amount of subsidy for the FDIC to give to the billionaire owners of this bank, especially when the bank leadership refuses to create a strong community reinvestment plan. Given this new information, the Federal Reserve must hold public hearings in Los Angeles. The community deserves an opportunity to give input on the outsized corporate subsidies, the ongoing enrichment of billionaire investors, and the lack of public benefit with this proposed merger.”

Don't be a grinch OneWest (Sandy)

Sandy Jolley speaks about reverse mortgage foreclosures

Sandy Jolley, a reverse mortgage consumer advocate who has worked with senior homeowners and their families who have been harmed by reverse mortgages, including some whose mortgages were serviced by Financial Freedom, a OneWest subsidiary. She spoke at the conference today, explaining: “It’s been a busy holiday season for OneWest Bank, with at least three different cases of the bank moving to foreclose on seniors and widows, including a 103-year-old. Today, we’re calling on the bank CEOs to stop playing Grinch and to implement a moratorium on foreclosing on widowed homeowners.”

Stop foreclosing on seniors

Paulina Gonzalez, executive director at CRC

Paulina Gonzalez, executive director at the California Reinvestment Coalition commented: “An estimated 35,000 California families have been hurt by OneWest foreclosing on them during the past six years. As these middle class and working class families lose their homes, the FDIC has been writing checks to the billionaire investors who own OneWest. Is this really how it’s supposed to work?”


Orson Aguilar, executive director at Greenlining Institute

“The last thing California needs is yet another too-big-to-fail bank for the one percent, but that’s exactly what we’re going to get if this merger goes through as planned. Our diverse state deserves better” said Orson Aguilar, executive director of the Greenlining Institute.

Santa delivers message

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Additional Background: Representatives from the following organizations attended the press conference and rally:

  • The California Reinvestment Coalition,
  • Valley Economic Development Center (VEDC),
  • East LA Community Corporation (ELACC),
  • Montebello Housing Development Corporation,
  • Greenlining Institute,
  • ACCE,
  • PACE,
  • Affordable Housing Services,
  • Occupy Our Homes,
  • Occupy Fights Foreclosure, and
  • The Multi-Cultural Real Estate Alliance for Urban Change

A CIT Group/OneWest Proposed Merger Resource Page on the California Reinvestment Coalition website includes additional information about the proposed merger and why over fifty organizations are currently opposing the merger, urging the Federal Reserve and Office of the Comptroller of the Currency to hold hearings, and calling on the bank to stop foreclosing on widowed homeowners.

Is Congress Really Set to Pass Legislation Written By A Citigroup Lobbyist?

Citibank Legislation

Does Wall Street have no shame?

Americans for Financial Reform, the Leadership Conference on Civil and Human Rights, The Other 98%, and other bank watchdogs are blasting Congress for potentially destroying a key protection that was included in the Dodd-Frank financial reform legislation.  Dodd Frank financial reform was passed in response to the Wall-Street induced financial meltdown, and aimed to curb the riskiest behavior that ultimately resulted in hundreds of thousands of jobs lost, retirement savings lost, and millions of people losing their homes to foreclosure.

If this “gift” is allowed to go through, banks will be allowed to use insured deposits and other taxpayer subsidies and guarantees to gamble in the derivatives market.  This practice helped create the 2008 financial crisis.

Under Dodd-Frank, bank holding companies are required to segregate, and independently fund their riskiest and most exotic derivatives trading.  This requirement means taxpayers won’t be on the hook if the banks engage in risky behavior again.

Until now.

Apparently a measure, written by Citigroup lobbyists, has worked its way into the stop-gap government funding measure.

What can you do about it?

Call your senators and let them know.  We don’t want the banks to be allowed to gamble with American citizens picking up the tab at the end.  The “Citigroup measure” included in the omnibus spending bill must be removed!

PS: As a reminder, Wall Street is counting on you to have a short memory.  Consider CIT Group, which received $2.3 billion under the TARP program.  At the time, taxpayers were told this “investment” was important because of CIT’s role as a small business lender.  A year later, CIT had made only 142 small business loans (that’s 1,053 fewer than the year before), and CIT also declared bankruptcy, wiping out its obligation to repay taxpayers.  Fast forward to 2014, and CIT Group is now trying to buy OneWest bank and create another Too Big To Fail Bank.  In addition to the $2.3 billion “gift” to CIT Group, there’s ongoing corporate subsidy tucked into this deal as well- take a look at the lucrative shared-loss deal that OneWest’s billionaire owners were able to secure from the FDIC: Is the FDIC Subsidizing a ‘Too Big to Fail’ Merger?

Community Members have 6 Big Problems With OneWest and CIT Group Merger

Have you heard about the proposed bank merger of OneWest (former IndyMac) and CIT Group?

Over fifty organizations OPPOSE the merger, citing a long list of concerns to the regulators who are reviewing the proposed merger.  You can read more about their concerns here: 50 Organizations Oppose Too Big To Fail Bank Merger in California

Here’s what community leaders have said about the CIT/OneWest, Too Big To Fail merger thus far:

1) Harmful foreclosures, including on seniors with reverse mortgages

OneWest, and its subsidiary, Financial Freedom (reverse mortgage servicer) have foreclosed on tens of thousands of foreclosures, hurting homeowners and destabalizing communities.  Worse, it’s highly likely that the bank is being reimbursed by the FDIC as these mortgages go into foreclosure.

Sandy Jolley, a reverse mortgage consumer advocate who has worked with senior homeowners and their families harmed by reverse mortgages, raised the issue of harmful foreclosures on seniors by OneWest at an EGRPRA meeting earlier this week with top regulators, including the Comptroller of the Currency, Thomas J. Curry; Kay Kowitt, the Deputy Comptroller for the Western District, Martin J. Gruenberg, Chairman of the FDIC; Barry Wides, Deputy Comptroller for Community Affairs, Office of the Comptroller of the Currency; and Maryann F. Hunter, Deputy Director, Division of Banking Supervision and Regulations, Board of Governors of the Federal Reserve System, and others.

She comments: “I’m interested to see how regulators will address harmful products and practices (like reverse mortgages) in the context of measuring whether or not banks are meeting community credit needs.”

Here’s two recent stories about OneWest foreclosing on three  seniors with reverse mortgages:

From American Banker: HECM Non-Borrowing Spouses Renew Class Certification Attempts:

One, Janice Cooper, is a 73-year-old federal government retiree in Southern California with severe heart disease. She also requires the assistance of a registered service dog. Her only income comes from Social Security and does not know where she will live if the foreclosure goes through, according to the court filing.

The other, Ernestine Harris, is a longstanding plaintiff in AARP Foundation litigation against HUD. She is 65 and legally blind, according to a declaration filed by her attorney, J. Rachel Scott.

From CBS Dallas Fort Worth: 103-Year-Old North Texas Woman Fights To Keep Her House

Now OneWest, which is based in California with a small office in Dallas, is attempting to foreclose on Lewis’ home after she accidentally allowed her insurance to lapse, a violation of the loan agreement.

Daniel Rodriguez, director of the community wealth department at East LA Community Corporation explains: “Regulators missed their opportunity to prevent banks like IndyMac from making predatory mortgages, and communities throughout Los Angeles were destabilized as a result. The regulators have an important opportunity with this merger to protect homeowners from further preventable foreclosures.”

Kevin Stein, associate director of the California Reinvestment Coalition, suggests the regulators take a closer look at OneWest’s foreclosure record as part of the merger approval process: “Thousands of seniors and other homeowners have been hurt by OneWest, and counselors throughout California have rated it as one of the worst servicers in the state. This merger is an opportunity for regulators to review the bank’s record, audit their practices, and ensure that additional homeowners weren’t harmed by practices inconsistent with their loss share commitments.”

2) Bank’s Community Reinvestment Record is Weak 

Kevin Stein associate director at the California Reinvestment Coalition, explains that CIT Bank is a poster child for banks trying to circumvent the requirement to reinvest in their communities. CIT Bank accepts deposits from communities around the US ($14 billion worth in the case of CIT Bank), but only reinvests the money in Salt Lake City, Utah, near its headquarters:  “CIT Bank accepts $14 billion in deposits from around the US (via the Internet), but gets away with only reinvesting that money into communities near its Salt Lake City headquarters.”

Michael Banner, Chief Executive Officer, of Los Angeles LDC, comments: “While its peer banks have 30% of their branches in our communities, only 15% of OneWest bank branches are located in low and moderate income census tracts. If OneWest is serious about this merger moving forward, we would suggest it take a reality check and look at what its peers have accomplished as benchmarks for the many areas where it can improve.”

Roberto Barragan, president of Valley Economic Development Corporation, comments: “Here’s two banks that wouldn’t be alive without the support of taxpayers and bank regulators, and yet, they’re not willing to outline a strong plan of reinvesting in the communities where they do business? Until they are willing to come to the table with the community, this is a no-brainer for regulators. No public benefit means no merger approval.”

3) OneWest originates a low number of loans to Asian Homeowners 

Hyepin Im, president and CEO of Korean Churches for Community Development comments: “Our communities are particularly concerned about the low level of mortgage lending by OneWest as compared to its peers. According to 2013 HMDA data, for the industry as a whole, 16% of mortgage loans in California went to Asian borrowers. In comparison, only seven percent of OneWest’s mortgages went to Asian borrowers. Regulators should take a close look at OneWest’s record in light of this proposed merger.”

4) The FDIC is providing ongoing Corporate Welfare to the Billionaire Owners of OneWest Bank

When the billionaire owners of OneWest Bank purchased the bank, they secured a lucrative “shared loss” agreement from the FDIC, meaning the FDIC is help covering the cost of soured loans that were originated by IndyMac Bank.

Paulina Gonzalez, executive director of the California Reinvestment Coalition comments: “Shared loss agreements are meant to protect our entire financial system, not to facilitate the enrichment of a few private investors who stand to gain immensely from this merger, while communities are left behind. Although the Loss Share Agreement may have been appropriate during the time of the financial crisis after IndyMac failed, the transfer of the Shared Loss Agreement to CIT Group as part of this proposed merger serves no public purpose or government interest, and only enriches investors. ”

5) On Creating another Systemically Important Financial Institution (Regulator Speak for Too Big To Fail)

“We don’t need another bank that is too big to fail,” said Michael Banner, Chief Executive Officer, of Los Angeles LDC. “We need to make sure that OUR communities don’t fail, by putting protections in place that insure improved access to capital to Main Street businesses and economic development projects that create much needed jobs and revitalize those communities that were hardest hit by the Wall Street induced financial crisis.”

6) No Clear Public Benefit from this Merger

“We see there are two sets of rules for Wall Street and Main Street,” comments California Reinvestment Coalition Executive Director Paulina Gonzalez. “Bank CEOs and investors will potentially ‘earn’ millions from this merger, despite no clear community benefits from the merger, and despite the fact this merger dramatically increases risks for the US financial system. Americans who are working two or three jobs to keep their head above water will have a hard time understanding how bank regulators would approve a merger that includes a plan for exorbitant executive salaries and planned corporate tax breaks and no guarantees of a clear public benefit.”

Kevin Stein, associate director at the California Reinvestment Coalition, adds: “CIT wants regulatory approval to buy OneWest, which will bring expected corporate profits, billions for investors, and millions for bank executives.

It also wants:

  1. To not to have to pay back $2.3 billion in TARP money it received from the US Government;
  2. To take advantage of merger’s expected profits and use tax gimmicks to lower its IRS bill;
  3. To have the FDIC agree to cover certain future losses; and
  4. To not offer a meaningful plan to serve and reinvest in the community.

Has a merger ever had so much public subsidy, so much private gain, and so little public and community benefit?”

If you’re concerned about this merger, please consider taking a few minutes to send an email to the regulators that will be making the decision about it.  You may receive a response that your “email isn’t timely.”  That’s okay.  It’s still important for regulators to hear from consumers and communities that will be impacted by this merger.  If you’ve had experiences with OneWest or Financial Freedom, please add that information in your message.  Here’s the link to send a message to the bank regulators:

Tell Bank Regulators: We need Public Hearings in LA on the OneWest and CIT Group Bank Merger


Community Bank Advocates Give Input on EGRPRA (Economic Growth and Regulatory Paperwork Reduction Act)

EGRPRA Hearing

Kevin Stein quips that the system, like his wrist, is broken.

You can watch the community panel here.  (discussion begins at 17:40 into the video)

Yesterday, community advocates attended a meeting in Los Angeles, hosted by the three main bank regulators, the Federal Reserve, the Office of the Comptroller of the Currency, and the Federal Deposit Insurance Corporation.  As part of the Economic Growth and Regulatory Paperwork Reduction Act of 1996, the meeting focused on identifying regulations that are outdated, unnecessary, or unduly burdensome while also balancing the regulator’s jobs to ensure the safety and soundness of the financial system.

After three panels with representatives from banks, a fourth panel consisted of community representatives.

Kevin Stein, associate director at the California Reinvestment Coalition, was one of the panelists.

A few takeaways from the meeting with community panelists include:

  1. The current rules need to be updated to reflect new bank practices.  Using CIT Bank as an example, some Internet banks are evading the requirements to reinvest in the communities where they accept deposits.  For example, while CIT Bank accepts $14 billion from around the US, it only reinvests those deposits near its Salt Lake City headquarters. See more here: Coalition Asks Bank Regulators: “Is There Community Benefit In OneWest And CIT Group Bank Merger?
  2. Dialogue is important between regulators, communities, and banks.  One good way to do this is through public community benefit and reinvestment plans.  To see an example of a recent one, look at Banc of California’s Community Benefit and Reinvestment plan.
  3. Bank regulators could provide negative credit to banks during their CRA exams for engaging in practices that are harmful to their communities- for example through financing payday lenders and other abusive lenders, or financing practices such as REO to Rental, which is hurting first-time homebuyers, displacing long-term tenants, and changing communities.  More about that here: 80 Organizations Ask Federal Gvt. to Address Investor Cash Flooding Into Neighborhoods   Another harmful practice can be seen in the example of OneWest bank foreclosing on widowed homeowners who have reverse mortgages serviced by Financial Freedom- a OneWest subsidiary. More examples of that here: HECM Non-Borrowing Spouses Renew Class Certification Attempts  and here: 103-Year-Old North Texas Woman Fights To Keep Her House  You can hear Sandy Jolley discuss Financial Freedom at the meeting here (move cursor to 1:10:18).
  4. Following their playbook BEFORE the our foreclosure crisis, banks are continuing to try and use preemption as a means to evade state consumer protection laws– for example, the California Homeowner Bill of Rights.  More on that here: Saving the Homeowner Bill of Rights 
  5. Some of the people most impacted by banks also may be the least likely to hear about bank mergers.  As an example, the California Reinvestment Coalition has begun hearing from consumers harmed by OneWest Bank and its subsidiary Financial Freedom because they have seen stories in the media about this proposed Too Big To Fail merger.  However, they are being told by the Federal Reserve that their comments “aren’t timely.”
  6. When banks leave communities, harmful financial service companies move in– like payday lenders, check cashers, and car title lenders. See CRC’s report about the high percentage of payday lenders in San Joaquin Valley as compared to banks: New Report Documents Lack of Banking and Financial Services in the San Joaquin Valley)

Interested in seeing more?  Read this press release: Community Advocates Urge Bank Regulators to Update Regulations (EGRPRA)


Regulation of Banks

How to Update the Community Reinvestment Act


Today, the three primary bank regulators are holding a meeting in Los Angeles, focused on identifying regulations that are outdated, unnecessary, or unduly burdensome. The meeting is being held as part of the Economic Growth and Regulatory Paperwork Reduction Act of 1996 (EGRPRA). Bank regulators are looking to balance regulatory burden with their duty to ensure the safety and soundness of the financial system.

The invited panelists on the first three sessions at the meeting are bankers. The fourth session includes representatives from community-based organizations who will speak about updating regulations like the Community Reinvestment Act (CRA).

Community panelists are expected to speak about issues including:

  1. Updating regulations to respond to new technologies and practices;
  2. Transparency with bank CRA plans;Public benefit (or lack thereof) as a result of bank mergers;
  3. Fair housing and credit issues; and
  4. Grade inflation with CRA exams, with 96% of banks receiving a “satisfactory” or higher rating since the inception of the CRA, according to the Congressional Research Service.

Kevin Stein, associate director at the California Reinvestment Coalition, one of the community speakers, explains:

“This may be one of the few times when we agree with the bankers in the room- at least on a few points. The CRA is outdated, doesn’t reflect current bank practices, and fails to protect consumers and communities. As an example, CIT Bank accepts $14 billion in deposits from around the US (via the Internet), but gets away with only reinvesting that money into communities near its Salt Lake City headquarters. CIT’s proposed merger with OneWest Bank also raises questions about public benefit with bank mergers, regulator transparency, and serving community credit needs.

Regulators should update the CRA to address Internet deposits and their corresponding assessment areas, improve CRA exams to also account for harmful banking practices (for example by giving banks negative CRA credit), and should increase transparency into bank CRA plans and bank mergers so the public can provide meaningful input.”

Sandy Jolley, a reverse mortgage consumer advocate who has worked with senior homeowners and their families harmed by reverse mortgages, is attending the event and adds: “I’m interested to see how regulators discuss harmful products and practices (like reverse mortgages) in the context of measuring whether or not banks are meeting community credit needs.”

Sasha Werblin, economic equity director with the Greenlining Institute, also a panelist, explains: “Regulators must develop better methods for involving the public in analyzing how banks serve consumers. One immediate way to do this is for regulators to hold public hearings before every significant bank merger. Hearings would ensure that regulators and the public have a dialogue about how banks operate for the public benefit, community credit needs, and banking practices that help — and hurt — consumers.

Edmundo Hidalgo, president and CEO of Chicanos Por La Causa, a panelist on the consumer panel, comments on the impact when banks leave communities: “As banks have left, our communities have been flooded with high-cost “alternatives” that are far more expensive and risky for consumers. Regulators should start by focusing on the extent to which banks are culpable for the expansion of fringe lenders like payday lenders, whether through their abandoning low-income communities, or in some cases, providing cheap financing to companies who extend high-cost, dangerous credit products like car title or payday loans.”

Additional Context:

In September, the three bank regulators (FDIC, OCC, Federal Reserve) asked for public comment on proposed changes to the Interagnecy Questions and Answers Regarding Community Reinvestment. The California Reinvestment Coalition provided suggested improvements, CRC’s full letter can be viewed here.

A July 2014 report from the Congressional Research Service cites some of the long-standing concerns community advocates have had with the CRA, including grade inflation because regulators look to a bank’s peers instead of looking at a community’s needs when judging a bank’s CRA record. Report: The Effectiveness of the Community Reinvestment Act