The intense battle between New York Attorney General Eric Schneiderman and Governor Andrew Cuomo over the state’s payout from a settlement with JPMorgan Chase has been resolved—for now.
The two offices will split the first $163 million payment from the bank, which is a result of a national settlement with JPMorgan Chase over fraudulent handling of mortgages leading up to the 2008 financial crisis. As we noted last week, while Schneiderman believed (with some legal backing) that the monies were his to disperse, Cuomo reportedly wanted all of the funds to be in his control.
Housing advocates were concerned that funds under Cuomo’s control would not reach troubled homeowners in the state, and for now those concerns seem to have been addressed—the $81.5 million under the governor’s discretion will be used for housing-related programs.
Schneiderman’s office, meanwhile, said he will fund the efforts we described last week—programs that are intended to encourage write-downs and modifications of troubled mortgages, and various other methods of outreach and protection to homeowners.
His office, however, did not respond to follow up questions about how the initial vision for the programs would be affected. It seems obvious that, with the funding cut in half to start, things can’t proceed exactly as planned.
Nor is there much clarity about the next several rounds of payments—the state is owed $613 million in total, and the distribution of the remaining payments has yet to be negotiated.