Multi-State Settlement Revisited

Last year, a big deal was made when 49 state attorneys general and the federal government announced a historic joint state-federal settlement with the country’s five largest mortgage servicers.  The settlement provided for as much as $25 billion in relief to distressed borrowers and direct payments to states and the federal government.

Unfortunately, even though Bank of America was one of the banks who agreed to the settlement, even though BofA agreed to pay almost $9 Billion to settle charges against it, and even though BofA agreed to stop their abusive foreclosure practices, they didn’t change their behavior in our case.

So, on September 20th, 2012, we sent a letter to numerous state and federal departments and regulators complaining that BofA was continuing their illegal practices in violation of the settlement.  And we heard nothing back …

Turns out, unsurprisingly, that we were not alone.  This week, New York state’s attorney general announced plans to sue Wells Fargo and Bank of America over alleged violations of a national mortgage settlement reached last year.  Atty. Gen. Eric Schneiderman’s office said Monday it intends to sue the banks for “repeatedly violating the terms” of the settlement.

Other state attorney generals are considering the same.  Hopefully, the era of “too big to jail” is coming to an end.  Stay tuned …

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