Prepared Remarks for Secretary of Housing and Urban Development Shaun Donovan at the Financial Fraud Enforcement Task Force Announcement Press Conference

Washington, D.C.
Tuesday, November 17th, 2009

Thank you so much. It's great to be here today with my colleagues to discuss our work to keep American families safe from the kind of financial scams and risky loan products that helped create this crisis in the first place.

HUD is already doing its part to step up enforcement, having suspended seven FHA lenders and steeply increasing efforts against FHA-approved lenders who don't play by the rules. We're sending a very clear message:

That if you don't operate ethically and transparently, we won't do business with you.

In one heartbreaking example, the case of Financial Mortgage USA, against whom we've proposed to permanently withdraw FHA approval, we found the company steered an 88-year-old woman into purchasing an annuity which would not mature until she reached her 104th birthday. That's heartless and shameless.

But as President Obama recognizes, no one agency is going to be able to stop fraud alone.

Indeed, as HUD has seen with its efforts inside and outside government as part of the NeighborWorks America campaign to educate homeowners about loan modification scams and in our enforcement action against Lend America, where we have been working closely with the Justice Department, interagency collaboration isn't merely "beneficial" to anti-fraud efforts - it's absolutely essential.

That's why the creation of this Task Force through President Obama's executive order is so important.

The Task Force will help us both avoid the duplication of efforts and create a more collaborative process that will lead to more effective investigations and enforcement.

As part of the Task Force, HUD is participating in a number of working groups, including one for Non-Discrimination and another for Mortgage Fraud.

Our 2010 budget proposal already includes $37 million to combat mortgage fraud and predatory practices - a third of which will go to curbing lending discrimination through increases in HUD's fair housing activities.

The Non-Discrimination Working Group, which HUD co-chairs, will build on these efforts - identifying opportunities for coordinated action including joint investigations and enforcement actions.

As much as housing was ground zero for discrimination, fraud and predatory lending in the run-up to this crisis, it's clear the federal response must be as interconnected and multi-dimensional as the challenges we face.

That's why we also need to create a Consumer Financial Protection Agency that will ensure that consumers get clear information they can understand - about financial products like credit cards and mortgages.

This agency will be charged with setting clear rules of the road for consumers and banks, including requiring brokers to look out for the interests of hardworking Americans if they give advice about mortgages.

The President has made clear that we're not going to let special interests win this fight - that we are going to deliver on clear rules for Main Street.

But delivering on strong enforcement as well starts with the work of this Task Force.

And with that, allow me to thank Attorney General Holder again and turn this over to Director Khuzami.

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