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Servicing / The Ticker

Minority groups sue Calif. governor for share of mortgage settlement

Money gave surplus to Golden State

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Black, Latino and Asian American organizations filed a petition in Sacramento Superior Court demanding that Governor Jerry Brown return up to $350 million out of California's share of the 2012 National Mortgage Settlement that was secured by California Attorney General Kamala Harris.

The groups allege the governor unlawfully diverted these funds to meet other obligations of the state. They argue the funds should have gone to their communities — those hardest hit be the economic downturn.

"Although the State of California at that time faced a budget deficit, that was then. Now, due in part to the Governor's successful efforts, the State projects a multi-billion-dollar surplus," a joint press release states.

In light of this imminent surplus, the National Asian American Coalition twice urged Governor Brown to return the unlawfully taken funds so they can be used for their originally intended purpose, they said. The Governor failed to respond.

Leaders of the groups represented in the suit include the Chair of the Orange County Interdenominational Ministerial Alliance and the Senior Pastor for Christ Our Redeemer African Methodist Episcopal church, the largest Black church in Orange County; the National Hispanic Christian Leadership Conference, representing 40,000 Latino evangelical churches across the nation; and the NAAC, a HUD-approved Asian American homeownership advocacy group, the largest of its kind in the nation.

Representing the Petitioners in this lawsuit is Jenner & Block, including Neil Barofsky, the former Special Inspector General at the US Department of the Treasury.

Robert Gnaizda, former general counsel for the Greenlining Institute, is general counsel for the NAAC and represents the COR AME church in its advocacy efforts.

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