Today’s piece in the Washington Times makes inaccurate and unfair suggestions of impropriety that are simply not supported by facts.
Senator Feinstein had no knowledge of CB Richard Ellis’ receipt of an FDIC contract before the Washington Times made an inquiry on January 21st. There is no evidence of any conflict of interest - or any connection - between the Senator’s foreclosure relief bill and CB Richard Ellis winning a competitively-bid contract, which was awarded - unbeknownst to her - by non-political career staff.
California is besieged by foreclosures – the state has the nation’s highest number of foreclosures, with 837,665 foreclosures filed in 2008 alone. In the first quarter of 2009, California has seen another 230,915 foreclosure filings - a 35 percent increase over the fourth quarter of 2008. The foreclosure relief bill was only one of many actions Senator Feinstein has taken to address this crisis (see attached timeline).
Senator Feinstein learned of FDIC Chairman Sheila Bair’s proposal for foreclosure relief for homeowners from news reports, expressed her support in a letter, and introduced legislation to allocate $25 billion from the Troubled Assets Recovery Program (TARP) to implement it.
Subsequently, the President, by executive order, allocated $75 billion in federal funds for a foreclosure relief program similar to the Bair plan. Consequently, Senator Feinstein’s legislation was not necessary and no action on it has been forthcoming.
The Washington Times reporter frames his piece with distortions. He asserts that Senator Feinstein’s foreclosure relief bill was “an intervention on behalf of FDIC.” This is nonsense. Her sole motivation was to help struggling homeowners. Additionally, a federal agency does not benefit itself from administering federal funds which are designated to help citizens stave off foreclosure.
The reporter also wrongly asserts that it is “unusual” for Senator Feinstein to pursue legislation related to FDIC because she is not on the Senate Committee on Banking, Housing and Urban Affairs. But a simple examination of the Senator’s legislative record reveals that she has often pursued legislation that falls outside the scope of her committee assignments.
Below is a sample of bills that Senator Feinstein introduced in the last Congress:
- A bill that established licensing standards for the mortgage industry, although she is not on the Banking, Housing and Urban Affairs Committee (enacted as part of P.L. 110-289);
- A bill that closed the Enron Loophole, although she is not on the Agriculture Committee (enacted as part of P.L. 110-234);
- A bill that banned harmful phthalates from children’s toys, although she is not a member of the Commerce Committee (enacted as part of P.L. 110-314);
- A bill to raise fuel efficiency of America’s fleet of vehicles by ten miles per gallon over ten years, although she is not a member of the Commerce or Energy Committees (enacted as part of P.L. 110-140);
- A bill to renew trade sanctions against the Burmese junta, although she is not a member of the Finance Committee (enacted as P.L. 110-52);
- A bill to reduce the tariff on imported ethanol, although she is not a member of the Senate Finance Committee.
Senator Feinstein has the highest ethical standards and complies with all requirements of the Ethics Committee. Her legislative agenda is dictated by what she believes is best for the people of the United States and the people of California. Period. Any suggestion to the contrary is untrue and unfair.
Timeline of Foreclosure Prevention and Housing Recovery Activity
Senator Dianne Feinstein (January 1, 2008 – present)
January 29, 2008 – Senator Feinstein sends a letter to Senate Majority Leader Reid (D – NV) calling for increasing conforming loan limits from $417,000 to $730,000 during Senate consideration of the first economic stimulus package (Public Law 110-185). This would provide relief to the distressed housing market in California.
February 6, 2008 – Senator Feinstein introduces the S.A.F.E. Mortgage Licensing Act of 2008 (S. 2595) with Senator Martinez (R – FL) to combat mortgage fraud and implement licensing standards that will help prevent foreclosures.
March 26, 2008 – Los Angeles Mayor Antonio Villaraigosa endorses the S.A.F.E. Mortgage Licensing Act at press event with Senator Feinstein and a family facing foreclosure due to mortgage fraud.
April 1, 2008 – Senator Feinstein sends a letter to Senate Banking, Housing, and Urban Affairs Committee Chairman Dodd thanking him for taking time to discuss the S.A.F.E. Mortgage Licensing Act. The letter briefly explains the bill’s licensing standards and urges Chairman Dodd to include the legislation in the Banking Committee’s foreclosure prevention bill.
April 3, 2008 – Senator Feinstein delivers floor speech in support of S.A.F.E. Mortgage Licensing Act as an amendment to the Senate version of a proposed housing market reform bill.
April 10, 2008 – Senator Feinstein sends a letter to Citigroup Chairman Robert Rubin expressing concern about the bank’s opposition to the S.A.F.E. Mortgage Licensing Act. Citigroup requested that independent contractors working for Primerica Financial Services, a Citigroup subsidiary, be exempted from the bill’s licensing standards. Senator Feinstein’s letter urged Citigroup to drop its opposition because mortgage products should be sold by licensed professionals.
April 24, 2008 – Senator Feinstein sends letters to 6 prominent bank CEOs (JP Morgan Chase, Bank of America, Citigroup, Wells Fargo, HSBC, Washington Mutual) urging them to take the lead in developing innovative solutions to prevent foreclosures. The letters suggest providing a one-time loan modification opportunity for all qualified borrowers and improved early notification procedures. Additionally, the letters outline the devastating effects of foreclosures on families and communities in California.
May 20, 2008 – The Senate Banking, Housing, and Urban Affairs Committee adopts the S.A.F.E. Mortgage Licensing Act as an amendment to the Senate’s housing market reform bill.
June 16, 2008 – Senator Feinstein sends a letter to Senate Banking, Housing, and Urban Affairs Committee Chairman Dodd (D-CT) and Ranking Member Shelby (R-AL) urging them to make the $729,750 conforming loan limits permanent in the final version of the housing market reform bill to help provide secure mortgage options for working families in California.
June 18, 2008 – Senator Feinstein sends a letter to Senate Banking, Housing and Urban Affairs Committee Chairman Dodd and Ranking Member Shelby explaining the importance of the S.A.F.E Mortgage Licensing Act and thanking them for including the legislation in the housing market reform bill reported out of Committee.
July 1, 2008 – S.A.F.E. Mortgage Licensing Act included in the final Senate-passed version of the housing market reform bill (H.R. 3221).
July 26, 2008 – Senate passes conference report of the housing market reform bill.
July 30, 2008 – Housing and Economic Recovery Act of 2008 (Public Law 110-289) enacted, which includes the Feinstein-Martinez S.A.F.E. Mortgage Licensing Act in Title V of the bill.
September 8, 2008 – Senator Feinstein sends a letter to Housing and Urban Development (HUD) Secretary Steve Preston urging him to provide a generous allocation of funding to California through the $3.9 billion of Community Development Block Grants authorized by the Housing and Economic Recovery Act of 2008 (Public Law 110-289). The letter spotlights the foreclosure crisis facing Stockton, California, which was the Nation’s foreclosure capital at the time. Additionally, the letter requests that HUD Secretary Preston consider initiating a pilot program to renovate foreclosed properties for purchase by teachers, firefighters, and police officers at more affordable prices to help rebuild communities devastated by foreclosures.
September 26, 2008 – Senator Feinstein sends a follow-up letter to HUD Secretary Steve Preston with Senator Boxer (D – CA) expressing disappointment in California’s allocation of Community Development Block Grants authorized by the Housing and Economic Recovery Act of 2008 (Public Law 110-289). The letter notes that it is “totally unacceptable” that the state that is hardest hit by the foreclosure crisis does not receive the highest level of funding to rebuild communities and renovate foreclosed properties.
October 17, 2008 – Senator Feinstein sends a letter to Governor Schwarzenegger requesting that California cities and counties that have been hard-hit by the foreclosure crisis receive appropriate Community Development Block Grant funding to rebuild and renovate abandoned homes.
October 17, 2008 – Senators Feinstein and Martinez (R – FL) send a letter to AIG CEO Edward M. Liddy expressing strong concern about the company’s lobbying activities targeted toward weakening the mortgage licensing standards outlined in the S.A.F.E. Mortgage Licensing Act.
October 30, 2008 – Senator Feinstein sends a letter to FDIC Chairman Bair supporting her approach for systematic loan modifications to prevent foreclosures.
January 6, 2009 – Senator Feinstein introduces the “Systematic Foreclosure Prevention and Mortgage Modification Act” (S. 73). The bill implements the foreclosure prevention plan that was utilized successfully following the FDIC takeover of California-based IndyMac bank in July 2008. This bill serves as a companion to legislation introduced in the House by Rep. Maxine Waters (H.R. 37).
January 12, 2009 – Senator Feinstein sends a letter to President-elect Barack Obama regarding his Administration’s use of Troubled Asset Relief Program (TARP) funds. She notes that while the TARP program was intended, in part, to reduce foreclosures, no funds had been used to do so. Senator Feinstein urges the President-elect to set aside at least $25 billion of TARP funds to implement foreclosure reduction measures such as the FDIC mortgage modification plan.
January 26, 2009 – Senator Feinstein sends a letter to President Obama requesting that he consider programs of importance to California as he develops his FY 2010 budget proposal. Included was a request to include $500 million for the Housing Counseling Assistance program, which supports non-profit housing counseling agencies to help struggling borrowers negotiate affordable loan modifications to prevent foreclosure.
February 4, 2009 – Senator Feinstein and Senate Majority Leader Reid (D-NV) cosponsor an amendment offered by Senate Banking Committee Chairman Dodd (D-CT) to the Economic Recovery bill (Public Law 111-16) to provide $50 billion in TARP funds for the Treasury Department to develop a mortgage modification program. The amendment authorized the FDIC to carry out the program and was agreed to by voice vote.
February 10, 2009 – Senator Feinstein sends a letter to Senate Majority Leader Reid (D – NV) and Senate Finance Committee Chairman Baucus (D – MT) regarding the conference negotiations of the Economic Recovery Act (Public Law 111-16). The letter requests that the conference report improve the tax credit for homebuyers by making the funds available immediately at closing to further incentivize home purchases in distressed areas. Additionally, the letter urges the implementation of reasonable income limits for this benefit to reduce the bill’s cost.
March 4, 2009 – The Treasury Department releases guidelines for the Obama Administration’s $75 billion foreclosure prevention plan. The plan implements elements of the FDIC systematic mortgage modification model with TARP funds.