May 22, 2018

DOJ Probe Targets Mortgage Pricing at PNC

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DOJ Probe Targets Mortgage Pricing at PNC

PNC Financial Services is reportedly being investigated by federal regulators on its mortgage business, including how it priced mortgages for customers. 

The investigations by the Justice Department and the Consumer Financial Protection Bureau center around how mortgages were priced by National City and PNC and whether pricing “had disparate impact on protected classes” of home owners, such as certain ethnic groups or income levels. 

PNC disclosed the investigation in a filing with the U.S. Securities and Exchange Commission. PNC purchased National City in 2008. National City is the seventh largest bank in the U.S.

President Barack Obama vowed to hold companies responsible for financing the housing bubble and for their involvement in the subsequent financial crisis. Several banks have faced lawsuits recently. The government filed a civil lawsuit against Bank of America Corp. last week over the sale of $850 million in residential mortgage-backed securities. JPMorgan Chase & Co. also recently announced that the company is undergoing a criminal probe by the Justice Department over sales of its mortgage-backed securities. 

Source: “Feds investigating PNC over mortgage pricing,” The Associated Press (Aug. 8, 2013) and “PNC subpoenaed on foreclosure costs; mortgage pricing probed,” Reuters (Aug. 8, 2013)

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