Five Legal Assistance Groups Receive Funds under Bank of America Mortgage Settlement

BOSTON, March 11, 2016 /PRNewswire/ -- Eric D. Green, independent Monitor of Bank of America's August 20, 2014, mortgage settlement with the U.S. Department of Justice and six states, today announced the distribution of a total of $90.2 million to legal-assistance organizations in California, Illinois, Kentucky, Maryland and New York, as mandated under the settlement, to provide legal assistance in foreclosure prevention and community redevelopment.

The recipient groups are among 56 state-based legal-assistance organizations that will receive funds under the settlement, which settled legal claims arising from mortgage-related activities by Bank of America and its subsidiaries. A distribution was made earlier to NeighborWorks America, a national, congressionally-chartered nonprofit organization that provides training and support for community-based redevelopment programs in the United States and Puerto Rico.

Today's recipients represent five of the six states whose attorneys general were co-signatories to the settlement. The organizations and the amounts they are receiving are:

• The State Bar of California Legal Services Trust Fund Program, $44,728,659;
• The Lawyers Trust Fund of Illinois, $13,037,872;
• The Kentucky IOLTA Fund of the Kentucky Bar Foundation, Inc., $6,016,165;
• The Maryland Legal Services Corporation, $4,396,113; and
• The IOLA Fund of the State of New York, $21,990,451.

The eligible organization in the sixth settling state, Delaware, will receive its distribution in the coming days upon completion of appropriate documentation. Distributions to eligible organizations in the remaining states and jurisdictions will follow.

The pending distributions – totaling more than $490 million nationwide – were triggered in December by President Obama's signing into law an act extending federal tax relief through 2016 to homeowners who otherwise would have incurred income-tax liability from mortgage debt forgiveness they received under consumer-relief provisions of the settlement. The money being distributed to the nonprofit organizations is from a fund established under the settlement to provide federal tax assistance to homeowners in case Congress failed to extend the tax-relief legislation.

With the signing of the legislation, the tax-relief fund became surplus. Under the terms of the settlement, Professor Green is required to distribute 75 percent ($367.62 million) of the fund to eligible legal-assistance organizations in each state and the remaining 25 percent ($122.54 million) to NeighborWorks America.

The settlement provides that in each state, the District of Columbia, and each U.S. territory or possession, to the extent practicable, the legal-assistance organizations are to receive a distribution of $200,000 from the fund, with the remainder to be allocated among the states and other eligible jurisdictions based on poverty population data collected by the U.S. Census Bureau, in the manner used for funding distribution by the Legal Services Corporation. As specified in the settlement, these recipients are state-based Interest on Lawyers Trust Account (IOLTA) organizations or other state bar association affiliated intermediaries that fund legal aid organizations in their jurisdictions.

Professor Green, a Boston-based professional mediator and retired Boston University law professor, was hired as independent Monitor to oversee the tax-relief fund and the bank's compliance with its ongoing consumer-relief obligations under the settlement.

More information about the settlement is available at the Monitor's website: http://bankofamerica.mortgagesettlementmonitor.com. The Monitor's mailing address is: Monitor of the Bank of America Mortgage Settlement, P.O. Box 10134, Dublin, OH 43017-3134, and the e-mail address is [email protected].

SOURCE Eric D. Green - Bank of America Monitor