Democratic presidential contender Kamala Harris praised California governor Gavin Newsom for a homeowner assistance program that his office once tried to improperly spend on state debt.
The California Supreme Court decided the Newsom administration must allocate $331 million in legal assistance to Californians facing foreclosure, rejecting Newsom’s attempts to use the money for other purposes. Harris commended the governor on Twitter and touted her own record as the state’s attorney general. She pointed to her role in a $20 billion settlement with major banks in the wake of the 2009 financial crisis.
“In 2012, we took on the big banks and won $20 billion in relief for families who lost their homes to foreclosures,” the tweet says. “I’m proud that @GavinNewsom is putting $331 million of the money we won towards resources to help CA families keep their homes.”
In 2011, Harris joined a coalition of all fifty state attorneys general to begin settlement discussions with major mortgage lenders over their role in causing the crisis. While the eventual eleven-figure settlement proved successful for Harris politically, it did very little to help Californians facing foreclosure.
Of the $20 billion in relief, nearly $14 billion went to short sales and second mortgages, allowing the big banks to “use settlement money to reimburse themselves for money they might have lost anyway,” according to Neighborhood Assistance Corporation of America founder Bruce Marks. About 200,000 homeowners received restitution payments of $1,500, leading one victim to callthe settlement “a slap in the face for a lot of us.” – READ MORE