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$25 Billon Mortgage Settlement Seen as One Step Towards Fairness

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Negotiations Continue with Other Lenders

By Charlene Crowell, NNPA Columnist –

The recent mortgage agreement reached with the nation’s five largest mortgage services brings the first major consumer victory after a nearly year-long effort. State attorneys general, working with the Departments of Justice and HUD together announced a $25 billion settlement for consumers in 49 states. Participating banks are Ally Financial, Bank of America, Citigroup, JP Morgan Chase and Wells Fargo.

The largest share of the settlement – more than $20 billion — will be dedicated to financial relief for consumers. These funds will be used to assist homeowners with mortgages that are in distress or foreclosure or underwater, now owing more than the home is actually worth. Today, nearly 11 million families with mortgages now owe more than their home is worth.

Additionally, mortgage servicers will pay state and federal governments $5 billion in cash. Among these funds, $3.5 billion will be used to repay public funds spent on the investigation and to fund housing counselors and legal aid. This funding for housing counseling and legal aid is critical to ensuring that homeowners obtain the loan modifications and refinances promised in the settlement. In addition, because the settlement does not affect individual lawsuits, the legal aid funding will help homeowners defend themselves against improper foreclosure actions involving mortgage fraud, servicer misconduct or other legal violations.

The remaining $1.5 billion will establish a Borrower Payment Fund to provide cash payments to eligible borrowers whose homes were sold or taken in foreclosure between January 1, 2008 and December 31, 2011. This specific initiative is in addition to restitution already administered by federal banking regulators.

The value of the settlement also will increase if negotiations with nine other lenders reach a successful agreement.

Commenting on the agreement second in size only to the 1998 tobacco settlement, President Obama said, “No action, no matter how meaningful, is going to entirely heal the housing market. But this settlement is a start.”

Mike Calhoun, president of the Center for Responsible Lending (CRL) agreed, adding, “Despite its limitations, the settlement requires real reforms in the mortgage servicing industry to stop sloppy business practices and out-and-out fraud. It will also help stabilize housing markets and property values by giving more homeowners a chance to restructure or refinance out of unaffordable loans that are underwater.”

For consumers and communities seeking financial relief and fairness, the settlement offers three key takeaways:

Bank accountability: The settlement preserves the right to pursue claims of criminal violations. State attorneys general can also initiate cases related to fair lending abuses and securities fraud.

A stop to robo-signing and other mortgage servicing abuses: Banks are required to review foreclosure documents individually. Before a foreclosure can lawfully proceed, other options must be exhausted. Settlement payments for each family affected by robo-signing could receive $2,000. Even if a payment is accepted, homeowners who have already lost their homes to foreclosure could still sue the bank for damages.

Strong enforcement: An independent monitor will regularly assess bank performance against a series of measures related to loan modifications and foreclosure. Any violations found will trigger penalties up to $1 million per violation or up to $5 million for certain repeat violations. Joseph A. Smith, most recently the North Carolina Commissioner of Banks, will oversee implementation of the new servicing standards.

In June 2010, CRL research found that African-American and Latino homeowners with mortgages lost $350 billion of family wealth through foreclosures. A 2011 foreclosure update by CRL again found that these communities of color continued to suffer disproportionate losses. Even when African-American and Latino consumers had high credit scores of 660 or more, they were still three times more likely than similar white consumers to receive a high-cost loan with risky features.

Wade Henderson, president and CEO of the Leadership Conference on Civil and Human Rights said of the settlement, You cannot put a dollar value on the suffering of these families but we can seek progress. And today’s settlement is a step in the right direction.”

Charlene Crowell is a communications manager with the Center for Responsible Lending. She can be reached at: Charlene.crowell@responsiblelending.org.

Apple, Sony Music Blasted After iTunes Whitney Houston Price Hike

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By Ishmael H. Sistrunk, Special to the NNPA from the St. Louis American –

According to digitalspy.com, the price for Whitney Houston’s greatest hits album, The Ultimate Collection,jumped from $4.70 to $14.99 on iTunes after news of the singer’s death.

Upset fans accused Apple of trying to capitalize on the Houston’s death. Apple in turn pointed the finger at Sony Music, saying the record company increased the wholesale cost of the album, causing the iTunes price to automatically increase.

Apple later returned the album to its original price late Sunday. No word on whether other online stores such as Amazon and Google Music were affected.

Powerless Majority? State of the Dream 2012 Says Non-Whites Will Still Suffer as Largest U.S. Group

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By Charlene Muhammad, National Correspondent
Special to the NNPA from the Final Call –

(FinalCall.com) – People of color will be the majority of America’s population by 2042. They will also remain the least wealthy, least employed, least educated, and the most incarcerated, unless the country steps up efforts to close its racial economic divide, according to a new report by United for a Fair Economy.

“State of the Dream 2012: The Emerging Majority” is the Boston-based economic think tank’s ninth annual assessment of progress on Dr. Martin Luther King, Jr.’s vision of justice and equality since his assassination.

The 2012 report measured 30 years of public policy on the racial divide and its impact on economics, poverty, education, homeownership, health care, and incarceration. The outlook was bleak.

“I keep asking myself, ‘Why is everyone marching out in the streets? I think this is not good enough for America. Forty years after Dr. King died and we’re still where he was, fighting about the disparities in income, wealth, education, and incarceration,” said Wanjiku Mwangi, Racial Wealth Divide Initiative leader for United for a Fair Economy and report co-author.

The report forecasts poverty rates for Blacks will be 1.9 times higher than for Whites, and for Latinos, 2.6 times higher. Black and Latino unemployment rates will be 1.8 and 1.5 times higher than White unemployment rates, respectively, it continues.

“The main thing that struck me was how for the last 10 years, even pre-recession, how income and wealth equality was declining for disenfranchised minorities and poverty was increasing. If this continues into mid-21st century then, racial disparities will be even worse than projected by 2042,” said Dedrick Muhammad, NAACP senior director of the Economic Department and executive director of the Financial Freedom Center. He formerly worked for United for a Fair Economy and contributed to the report.

Authors cited education as one of the most important tools people have for climbing social and economic ladders, but disparities perpetuate inequality. Any gains made during the civil rights era are threatened by restrictions on affirmative action in higher education, spiraling college costs and underfunding of education.

In addition, according to Ms. Mwangi, Blacks are six times more likely to be in prison than Whites and people of color make up over 65 percent of the prison population and five million Blacks will be imprisoned in 2042 if things continue.

She feels that while America has made some progress, a great lack remains because people have ignored the institutions, programs, and structural practices that have historically kept people of color down. The treatment of Blacks during Hurricane Katrina in 2005 is one example, she continued.

“The official response to that disaster makes you think about how little things tend to affect what we do, think, and how our institutions operate … And carry forward back and look at all institutions in education and unemployment. Those things are still perpetuated,” Ms. Mwangi said.

She believes there’s hope if America invests in infrastructure, jobs, and education. Without education, there’s no income and without income there’s poverty and no food. People are jailed and cycles continue, so the solutions are for the good of everyone, not just Blacks and people of color, she added.

The answer to the crisis facing Black America is it must do for self, guides the Honorable Minister Louis Farrakhan. A first step is to pool money in a national treasury to buy farmland and rebuild wasted cities, he said during a January 9 interview with Cliff Kelley on WVON-AM 1690.

“Obama cannot make jobs for all of us who are unemployed, but we can,” Min. Farrakhan said, continuing that donations to a national fund of as little as one nickel-a-day to $1-a-month would yield $480 million in one year.

Blacks will need every cent of that amount to survive the future, if the report’s predictions manifest.

As disenfranchised minorities become a larger proportion of the population, their inclination to support more progressive policy will advance policies most helpful to rebuild a middle class economy, according to Mr. Muhammad.

“Yet as money becomes more and more of a determining factor in politics and barriers to voting become more and more common, the democratic voice of minorities will probably be weakened,” Mr. Muhammad said.

Report recommendations include stemming the foreclosure crisis by offering loan modification programs, increasing federal funding for higher education, and ending the war on drugs to substantially impact the racial economic divide due in upcoming decades and begin realizing Dr. King’s dream.

Each year the organization releases its State of the Dream report on or around Jan. 15. The date is referred to as “King Day” and commemorates the civil rights leader’s birthday. Tragically, many disparities he fought and sacrificed his life for still plague people of color, Ms. Mwangi said.

“We have a nation that has a history of racial inequality and White supremacy, all the things that have been put in place 50 years ago, 100 years ago, are still together, intact. If you break down all those institutional structures and start looking at things in a different way, we’ll continue talking about disparities because we’re not fighting the real thing,” Ms. Mwangi said.

Plantation Where 14-Year-Old Slave Was Hung to Become Outlet Mall

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By Askia Muhammad, Senior Correspondent
Special to the NNPA from the Final Call –

WASHINGTON (FinalCall.com) – The site of a Maryland plantation which is renowned by local historians for its connection to Black history and to the Civil War has lost its historical designation and is on its way to becoming an 85-store outlet mall, after an early January vote by the Prince George’s County Historic Preservation Commission.

It’s “another tragic event in the story of Salubria,” Bonnie Bick, a local resident and organizer of the Reinvest in the Heart of Oxon Hill (Maryland) campaign told The Final Call. “At the same time that we were reviewing archeological information that said Salubria was eligible for the National Register of Historic Places; the vote was taken by the Historic Preservation Commission to take away, not to nominate it for the national register, but to take away its entire historic designation.”

Salubria is the name of a Maryland plantation, where in 1834, a 14-year-old slave girl—possibly influenced by Nat Turner’s slave rebellion in South Hampton, Va., in 1831—poisoned her master’s children and was later sentenced to death. She is listed in the Maryland Archive as the first Maryland woman who was reported to have resisted slavery. She confessed to having two years earlier poisoned an infant child of her slave master. She may be the youngest woman ever to be executed in the United States.

Despite the murders of his children, the plantation owner, horticulturalist Dr. John Bayne became a Union officer in the Civil War, helped convince the state of Maryland to compensate slave owners to free their slaves, and worked to provide public education to freedmen. “John Wilkes Booth might have rode past Salubria, and went on down to where there was a sympathizer,” for his assassination of President Abraham Lincoln in 1865, Ms. Bick pointed out. “Southern Prince George’s County was extremely (sympathetic to the Confederacy),” she said.

The Jan. 12 vote by the P.G. County planning board means all the archeological artifacts at Salubria will be taken out of the ground in order to “prepare it for economic development opportunity that is very poorly located,” said Ms. Bick.

In its findings, county Park and Planning staff concluded that protection of the 2.7 acres should be removed because the site has few remaining physical structures that can be restored or preserved, and the best way for the site to be preserved is through archaeological removal.

The Peterson Co., the developer of the glitzy, nearby National Harbor in Prince George’s County, has now received permission to remove all the archeology from the ground at Salubria, and has had the site’s historic designation removed.

William Shipp, a lawyer representing the Peterson Co., said that had the original structures on the property not been destroyed, the site proposal would have been “a different design than what we have today.” Black residents in the area are angry.

“I’m an African-American woman, and I’m sick of my history being obliterated. Nothing that matters to African Americans has been preserved,” Joyce Hawkins, a 69-year-old Tantallon, Md. resident told Gazette.net last summer when residents first organized to oppose commercial development of the property.

At that time The Washington Business Journal referred to the site in a headline as “Hallowed African American Ground.” But after the vote, Commissioner Robert H. Schnabel said it was “unfortunate” that the structures on the land had not been maintained properly. In 2003, a historic permit was approved that allowed for the demolition of remaining structures on the property. “What was done was inadequate, and it’s completely gone now,” Mr. Schnabel said, according to Gazette.net.

“What really gets me is that Milt Peterson—the developer—he purchased National Harbor property for $10.3 million, and he’s already gotten $500 million subsidy for his entrances and exits from the taxpayer,” Ms. Bick said. “So, it just seems so wrong for them” to take away the Black history, and subsidize it with taxpayer money. “As many as possible of the costs of this development are being externalized to the taxpayers,” she said.

Even the road leading to the projected outlet mall is being widened to four lanes by the county. The developer is proposing to put statues of select individuals in poses telling the story of Salubria, commemorative plaques, an interactive video, and floral and plant arrangements representing Dr. Bayne’s work as a horticulturalist at the site to designate its historical importance.

“It would have a tremendously negative impact on a Black neighborhood,” Ms. Bick argued. “The story has national significance and should be interpreted on the site,” and not removed for study.

A 140 page Phase II Archeological Evaluation prepared in Oct. 2011 by the firm Thunderbird Archeology for the P.G. County Historic Preservation Commission agreed with the preservationists. “It is our opinion that the historic component of (the) site is eligible for listing,” under three of the five criteria of the National Register of Historic Places, the report stated. Any one of these three could be adequate for the site’s qualification for national listing, and its preservation, its supporters insist.

“The location and boundaries of the site (are) considered to have significant research potential … Few National period farms or plantations have been studied at the Phase III level in Prince George’s County, Maryland and the lives of enslaved African Americans in the mid-19th century remains a neglected area of archeological inquiry throughout the region. Expansive and comprehensive data recovery at (the) site would create a valuable record of this significant site,” the report concludes.

“It is so wrong to have the county executive (Rushern Baker) supporting this,” said Ms. Bick. “It’s being promoted as a place for the community to shop, but there are alternatives where it wouldn’t be destroying a residential community that Peterson owns, but he’s not investing there” because he is continuing to buy property at alternative sites at “fire sale prices because of the public safety problems there. It’s very unjust.”

Prince Georges County, Md., is a majority Black county, which ranks as the most educated and affluent Black county in America. The county executive is Black and the majority of the county council is also Black.

The bottom line, Ms. Bick maintains is the negative impact the outlet mall development will have on the community, after the important historic site is destroyed. “Is this going to widen the gap between the economic barriers in the Washington region?” She insists the outlet mall will widen, not narrow the economic barriers.

Morehouse Launching Search for New Leader

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By Bekitembe Eric Taylor, Special to the NNPA from the Atlanta Daily Voice –

Morehouse College officials launched a national search for a new chief executive Tuesday, a day after school president Robert M. Franklin announced that he is stepping down from his leadership post when his contract ends June 30.

Board of Trustees president Robert Davidson said Tuesday that no names have yet surfaced to succeed Franklin, who has headed the all-male institution for the last five years.

“We are in the process of forming a search committee to perform a rigorous search for someone who embodies the core values of Morehouse,” said Davidson, a 1967 graduate of the college.

“In the evolution of Morehouse, we want to remain one of the premier institutions in the country,” he added.

Davidson and other college officials praised Franklin for helping to renew the college’s commitment to academic vigor, for doubling alumni donations and for generating more than $90 million in support of the college.

“Robert has led by example, dedicating a substantial portion of his time to community service, which is one of the core values that Morehouse seeks to instill in each and every one of its students,” Davidson said. “We will miss him as the board endeavors to find a replacement who will help to usher the college into a new era.”

While officials were publicly praising Franklin for his leadership, however, college insiders say Franklin was coming under increased scrutiny from board members and influential alumni for poor management decisions that led to a series of fiscal challenges – some say fiascos – at the school.

In an interview with The Atlanta Voice this week, Franklin and Davidson declined to comment about speculation that board members – weary of poor leadership decisions – forced Franklin to step down.

“We have a strict policy that we cannot talk about the financial matters of our staff or the college,” Franklin said. “But I can assure you that Morehouse is operating strongly at this time.”

Franklin, who turns 58 this month, circulated a Jan. 30 letter to college alumni on Monday, announcing that he would not seek another term as the school’s 10th president.

“After much thought and prayer reflection, I have decided to step down as president,” Franklin wrote. “Although I have enjoyed the privilege of serving this great college, and we have witnessed many great successes, I am looking forward to the next chapter of my professional life.”

A 1975 Morehouse graduate, Franklin said he will “pursue my passion for teaching” in various posts around the nation, including as a scholar-in-residence at Stanford University’s Martin Luther King Jr. Institute and as president emeritus and distinguished professor of social ethics at Morehouse.

“I look forward to a sabbatical during which I intend to travel, write, speak and interview leaders about the condition of boys and men in the U.S. and around the globe.”

Morehouse’s board of trustees named him President Emeritus and Distinguished Professor, the college’s highest honor.

“Dr. Franklin has served an integral role leading the renaissance of Morehouse, and his dedication is greatly appreciated,” Davidson said in a statement released by the college.

Franklin said wants his tenure to be remembered as one of scholarship and direct outreach to the student body.

“What I will miss about being president are the students,” he said. “I’ve had the opportunity to mentor to them, and know them to be the best and brightest of America’s treasures.”

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