Goldman, Morgan Stanley Fined as Fed Ends Foreclosure Cases

That same year, Mnuchin, a former Goldman Sachs banker, led a group of investors that included hedge fund billionaire John Paulson and finance giant George Soros in buying the bank. 

IndyMac's name was changed to OneWest and Mnuchin hired Otting, a veteran West Coast banker, to run it. The firm — beset by the foreclosure scrutiny — was sold off to CIT in 2015, and Mnuchin and Otting joined the Trump administration last year.

The 2011 actions from the Fed, Office of the Comptroller of the Currency and Federal Deposit Insurance Corp. were among the largest coordinated enforcement efforts in the years following the crisis

Ineffective Effort

The regulators first tried to set up what was known as the Independent Foreclosure Review in which the largest U.S. mortgage firms were meant to comb through thousands of foreclosures looking for errors, but the agencies eventually decided that effort was overly time-consuming and ineffective.

So, in 2013 they fined firms hundreds of millions of dollars and ordered them to pay out about $3.6 billion in cash to compensate borrowers, though many of the firms had lingering problems complying with orders to fix their internal systems.

The OCC's settlements with banks were completed a year ago, including final fines of $70 million for Wells Fargo & Co. and $48 million for JPMorgan after the two were accused of failing to move fast enough to satisfy the earlier orders.

In 2014, the Fed was faulted by its internal watchdog for its handling of complex settlements. Its Office of Inspector General said lax preparation and management led to poor execution of the settlement with the mortgage servicers.