2014 Government Regulations & Business Summit
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BOSTON – Five national banks have been sued by Massachusetts for their roles in allegedly pursuing illegal foreclosures on properties, as well as deceptive loan servicing, Attorney General Martha Coakley announced last week.
The lawsuit was filed in Suffolk Superior Court against Bank of America, Wells Fargo, JP Morgan Chase, Citi and GMAC. It also names Mortgage Electronic Registration System Inc. and its parent, MERSCORP Inc., as defendants.
In the complaint, Coakley alleged the five entities engaged in “unfair and deceptive” trade practices. These included pervasive use of fraudulent documentation in the foreclosure process, including so-called “robo-signing”; foreclosing without holding the actual mortgage; corrupting Massachusetts’ land-recording system through the use of MERS; and failing to uphold loan-modification promises to Massachusetts homeowners.
According to a statement, the banks used false documentation, whereby bank personnel signed affidavits that were untrue, or not based on the signor’s actual knowledge. An entity wishing to foreclose on a property must demonstrate it has filed an affidavit in compliance with Massachusetts law.
By October 2010, the banks’ “flagrant disregard” of affidavit and notary-process requirements became widely known, Coakley said. •