Excerpted from MONEYWATCH, May 6, 2013
Constantine Von Hofman
New York suing BofA, Wells Fargo Over Mortgage Pact
The banks have not complied with standards established for processing homeowners’ loan modification applications, New York Attorney General Eric Schneiderman said in a statement released today. He said he plans to sue the banks unless a monitoring committee set up to enforce the settlement’s terms takes action.
“Wells Fargo and Bank of America have flagrantly violated those obligations, putting hundreds of homeowners across New York at greater risk of foreclosure,” Schneiderman said.
Wells Fargo has also ignored obligations in California and, presumably, all other states. As noted in the following paragraph, banks — and Wells, specifically — uses “missing documents” as an excuse to avoid modification and proceed with bankruptcy. All paperwork submitted is via FAX (with confirmation of receipt) and FedEx or UPS (with confirmation of receipt). Yet, every conversation with the bank — Wells Fargo in these cases — results in “missing paperwork.”
Schneiderman claims BofA and Wells Fargo failed to acknowledge receipt of loan modification applications within three business days; did not tell homeowners about missing documents in their applications; didn’t give borrowers enough time to correct deficiencies; and failed to take action on loan modification requests within 30 days. He said these delays would result in additional fees and interest and in homeowners’ losing their homes.
Schneiderman said his office had documented 339 of these violations in the past seven months.
Last year five of the nation’s largest banks — including JPMorgan Chase (JPM), Citigroup (C) and Ally Financial — agreed to a sweeping pact with the attorneys general of 49 states over charges the banks evicted people using false or incomplete documentation. The settlement included 304 rules laying out how to respond in a timely fashion to homeowners seeking to modify their mortgages.
Wells Fargo and Bank of America declined to comment
This lawsuit is the first action by any of the states charging a bank with violating the pact.
While it’s admirable that New York is suing, we have yet to see ANY homeowner benefit from ANY of the billions that have been bandied about during the past several years. Underlying issues include ongoing rule changes, minimally trained intake staff and programs that could help IF anyone knew about them. As I face foreclosure, I just learned of a program that “might” have helped if I contacted them a few months ago. Saving one’s home is a full-time job; those of us that work do not know all the avenues and do not have the time or knowledge on ferreting out resources.
The settlement’s monitor, Joseph Smith, and a monitoring committee were notified of the action by Schneiderman. The committee may also take action against the banks for the alleged violations, according to the statement.
FBI Report: Financial Crimes, Corporate Fraud, Securities and Commodities, Health Care, Mortgage, Insurance, Mass Marketing, Money Laundering, Forensic Accountant, Financial Intelligence
The Federal Bureau of Investigation (FBI) investigates matters relating to fraud, theft, or embezzlement occurring within or against the national and international financial community. These crimes are characterized by deceit, concealment, or violation of trust and are not dependent upon the application or threat of physical force or violence. Such acts are committed by individuals and organizations to obtain personal or business advantage. The FBI focuses its financial crimes investigations on such criminal activities as corporate fraud, securities and commodities fraud, health care fraud, financial institution fraud, mortgage fraud, insurance fraud, mass marketing fraud, and money laundering. These are the identified priority crime problem areas of the Financial Crimes Section (FCS) of the FBI.