Today, the City of Los Angeles’ attorney’s office accused officials at Deutsche Bank of being one of the largest slumlords in Los Angeles and filed a lawsuit Wednesday claiming the company owes the city hundreds of millions of dollars in fines and asking the judge to issue an injunction forcing it to clean up the foreclosed properties it owns in Los Angeles.
Jessica Garrison of the LA Times reports on the issue:
After a yearlong investigation, city officials claimed in court papers that Deutsche Bank has illegally evicted tenants, shut off their water and power and then let hundreds of properties turn into graffiti-scarred dens for squatters, gang members and other criminals, destroying quality of life and driving up crime in the process.
Who am I to argue with the City of Los Angeles? As far as I’m concerned, the entire financial crisis was caused and has been exacerbated by the big banks’ greed and desire for more. Their piss-poor handling of the crash in the real estate market and the sour loans that were left on their books has continued to drag the market down while causing more losses for the very banks that the Federal Government has had to prop up with fiscal stimulus. Also, let’s not forget that Deutsche Bank is the very same banking corp that took over the struggling Cosmopolitan Hotel in Las Vegas in 2008. Just don’t ask them how much money that endeavor cost them (or how much over budget they were in their bid to build an ever larger trophy prize to house their over-inflated egos). [answers to these trivia questions are in the links at the bottom of this post] //
The main point I’m trying to make here is that time after time banks have proven to us that they are absolutely incapable of owning and managing any sort of property, causing harm to both the overall real estate market as well as the residents of the communities in which they infiltrate. Why do we continue to allow these banks to get away with the task that we never allowed Osama Bin Laden to carry out: and that was to cripple the United States’ economy.
Anyhow, back to the story at hand. The City of Los Angeles has pinpointed 2,000 Deutsche Bank owned properties that have fallen into disrepair and slum-like conditions, shown in the image above. Deutsche Bank has responded to these allegations, deflecting the blame for the disrepair of the properties they own onto special servicers that they themselves hired to maintain each of the properties. Sound fishy to you? Here’s what Deutsche Bank spokesman John Gallagher said in a statement:
The Los Angeles city attorney’s office has filed this lawsuit against the wrong party. As we have repeatedly advised the Los Angeles city attorney’s office, loan servicers, and not Deutsche Bank as trustee, are contractually responsible for both the maintenance of foreclosed properties and any actions taken with respect to tenants of foreclosed properties. For over a year, we have offered to help the Los Angeles city attorney’s office contact the loan servicers that are responsible for maintaining the properties in question,” he continued, “but they have refused our help and would not even tell us which properties they were talking about.
Who you choose to believe is up to you, all I know is that I can think of a different way I’d like to pronounce Deutsche.