Ben Protess writes in the New York Times (10/26, Protess, Subscription Publication, 1.23M) "DealBook" blog, "When Bank of America bought Countrywide Financial, the subprime lending specialist, it initially paid $4 billion. Some analysts have pegged the true financial toll - including write-downs, legal expenses and settlements - at upward of $40 billion. The costs threatened to widen further on Wednesday, when federal prosecutors in New York sued Bank of America over a mortgage program it inherited from Countywide. The Justice Department seeks to collect more than $1 billion in penalties over the program, known as 'the hustle,' which prosecutors say churned out fraudulent loans at a rapid pace. The final cost of that suit could total even more - $3 billion." DOJ says Countrywide and BofA sold mortgages they knew were bad to Fannie Mae and Freddie Mac.
Bank of America employees may face charges in Federal civil fraud case. Reuters (10/26, McCool, Stempel) reports that some employees of Bank of America Corp. may face civil fraud charges as part of the Federal lawsuit accusing the bank of causing more than $1 billion in losses to US taxpayers by selling toxic mortgage loans to Fannie Mae and Freddie Mac. During a hearing in Federal court in Manhattan on Thursday, Assistant US Attorney Pierre Armand told US District Judge Jed Rakoff that the government may modify its complaint to include individuals who are current or former employees of Bank of America.
BREAKING NEWS: This concerns borrowers who lost their homes to foreclosure between Jan. 1, 2008 and Dec. 31, 2011. Cash payments will be distributed to borrowers who receive and return a claim form. There is no requirement to prove financial harm and borrowers will not have to release private claims against the servicers nor will they have to relinquish the right to participate in the independent review process being conducted by federal banking regulators. $1.5 billion is expected to be distributed nationwide to some 750,000 borrowers. See: http://nationalmortgagesettlement.com/help/#timeline for more information. If you have any questions, or believe you have a claim against a mortgage company for wrongful foreclosure, please dont heistate to contact our office to discuss your case.
If your mortgage company has forced placed on your home in an amount greater than the amount that you owe you may have important legal rights to protect. Please contact Underwood & Riemer, PC as soon as possible for a FREE consultation. There is no obligation.
Call today for FREE information 251-990-5558 or 1-800-273-9534
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8:04 p.m. CDT, May 9, 2012
NEW YORK (Reuters) - The Florida Supreme Court is set to hear oral arguments Thursday in a lawsuit that could undo hundreds of thousands of foreclosures and open up banks to severe financial liabilities in the state where they face the bulk of their foreclosure-fraud litigation.
The court is deciding whether banks who used fraudulent documents to file foreclosure lawsuits can dismiss the cases and refile them later with different paperwork.
The decision, which may take up to eight months to render, could affect hundreds of thousands of homeowners in Florida, and could also influence judges in the other 26 states that require lawsuits in foreclosures.
Of all the foreclosure filings in those states, sixty three percent, a total of 138,288, are concentrated in five states, according to RealtyTrac, an online foreclosure marketplace. Of those, nearly half are in Florida. In Congressional testimony last year, Bank of America, the U.S.'s largest mortgage servicer, said that 70 percent of its foreclosure-related lawsuits were in Florida.
The case at issue, known as Roman Pino v. Bank of New York Mellon, stems from the so-called robo-signing scandal that emerged in 2010 when it was revealed that banks and their law firms had hired low-wage workers to sign legal documents without checking their accuracy as is required by law.
"This was a case of an intentionally fraudulent document fabricated to use in a court proceeding," says former U.S. Attorney Kendall Coffey, author of the book Foreclosures in Florida.
If the Supreme Court rules against the banks, "a broad universe of mortgages could be rendered unenforceable," Coffey says. "The cost to the financial industry is difficult to estimate, but it could be substantial."
For comparison, some legal experts point to the Massachusetts Supreme Court's decision in January 2011 that ruled a foreclosure invalid because at the time of the foreclosure the bank couldn't prove it had a valid assignment of mortgage - a similar issue to the one in the Pino case.
In the wake of the decision, hundreds of house titles in Massachusetts became void, says foreclosure attorney Tom Cox, who brought what was one of the first foreclosure fraud suits in the country.
Read more: Foreclosure case could slam banks
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