Foreclosure Scandal Poses Severe Economic Threat, Report Says

foreclosure sign
foreclosure sign

Fallout from the ongoing "robo-signing" foreclosure scandal may cost major banks billions, shake the foundations of the fragile housing market and threaten the stability of the U.S. economy, warns a new report from a congressional watchdog.

The Congressional Oversight Panel's November report, "Examining the Consequences of Mortgage Irregularities for Financial Stability and Foreclosure Mitigation," spells out best- and worst-case scenarios, though the picture is grim if the latter plays out.