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May 7, 2013

NY Attorney General to Sue Wells Fargo, Bank of America for Violating Foreclosure Deal 
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New York Attorney General Eric Schneiderman has announced plans to sue
Bank of America and Wells Fargo for violating the terms of a settlement
aimed at curbing foreclosure abuses. The $26 billion settlement was
reached last year between five major banks and 49 attorneys general. It
provided basic protections for homeowners such as requiring banks to
notify them about missing documents within a certain time period. But
Schneiderman said the banks had violated the terms of the settlement
with impunity. At a news conference Monday, he lifted a massive sheaf of
papers to show the hundreds of complaints issued by homeowners against
the banks.

Eric Schneiderman: Two of the participating servicers, Wells Fargo and
Bank of America, have flagrantly violated their obligations under the
settlement. I've sent a letter to the monitoring committee, the body
that oversees the implementation of the National Mortgage Servicing
Settlement notifying them of my intention to sue both Wells Fargo and
Bank of America for non-compliance with servicing standards spelled out
in the settlement. This enforcement action, which is the first taken
under the settlement, is based on 339 individual complaints from New
Yorkers against these two banks in just the last six months.
In a separate case, Bank of America will pay roughly $1.6 billion to
settle years of litigation with the bond insurer MBIA which had accused
the bank and its Countrywide unit of issuing risky loans that helped
fuel the financial crisis. The settlement also grants Bank of America
the right to buy a nearly 5 percent stake in the insurer.

 

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