Fed calls on banks to tighten mortgage rules (AFP)

WASHINGTON (AFP) - the Federal Reserve on Wednesday was asked some of the largest banks to tighten up their procedures for American mortgage and warned fines next, following a scandal over the houses being unfairly regained possession.

The Fed has issued so-called "consent orders" against 14 lenders - including the Bank of America, HSBC, JPMorgan Chase and Wells Fargo - are demanding a better surveillance, standards and documentation.

The banks have said "to the address a pattern of misconduct and negligence" treatment of foreclosure.

The scandal began with the evidence that the staff had signed documents seized pushing forward without proper validation, a practice which is known as "robo-signature."

There is no fine announced Wednesday, but they are expected.

"The Federal Reserve believes pecuniary sanctions in these cases are appropriate and plans to announce monetary penalties".

Banks moved to resume recording 2.87 million US homes in 2010, according to RealtyTrac foreclosure specialist.

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