« Ind. Gov't. - "E-mails show clubby IURC, Duke" | Main | Ind. Gov't. - More on "E-mails show clubby IURC, Duke" »

Wednesday, October 13, 2010

Law - "Attorneys general to initiate foreclosure probe" [Updated]

Ariana Eunjung Cha and Dina Elboghdady report in the Washington Post:

Attorneys general from dozens of states are set to announce Wednesday a joint investigation into the nation's biggest lenders, but will stop short of calling for a moratorium on foreclosures in their jurisdictions, officials said.

The multistate investigation, which includes Maryland, Virginia, California, Indiana, and Ohio, among others, will initially focus on whether Bank of America, J.P. Morgan Chase, Ally Financial and other large mortgage companies made misleading or fraudulent statements to evict struggling borrowers from their homes.

Indiana Attorney General Greg Zoeller said investigators initially will focus on whether industry employees - "robo-signers" - signed off on thousands of foreclosures every month without reviewing the files as legally required. Homeowner attorneys also allege that lenders forged signatures and improperly notarized documents. * * *

The companies could face more serious consequences if the attorneys general find criminal acts or that high-level industry executives knew what the robo-signers were doing. About two dozen states have joined the effort, though more are expected to sign up in the coming weeks, officials said.

Here is a very long list of ILB entries referencing "foreclosure."

[Updated at 1:10 PM] Make that all 50 states.

Stephanie Armour of USA TODAY reports this afternoon in a story that begins:

Attorneys General from all 50 states on Wednesday announced a joint investigation into whether major U.S. banks used faulty or fraudulent documents to foreclose upon delinquent homeowners.

The group will investigate whether companies misrepresented that they had reviewed and verified affidavits and documents used in foreclosures.

The goal of the Mortgage Foreclosure Multistate Group will be to stop improper foreclosure practices, review past practices, and to establish a potential financial settlement. The group may also seek to establish a new independent monitoring system to oversee future foreclosure processes.

The multi-state effort is being led by Iowa Attorney General Tom Miller, and also includes a number of state banking and mortgage regulators.

Alabama initially did not sign on to the investigation. It reversed course after the joint statement was released.

Posted by Marcia Oddi on October 13, 2010 08:32 AM
Posted to General Law Related