Robo-signing is over. But robo-suing is growing.
A small group of debt collectors are robo-suing people who default on their credit cards. Now, state and federal authorities are cracking down.
Remember the term “robo-signing”? You know: what all the mortgage companies were doing a couple of years ago when they kicked people out of their homes without following the process of law. Did you know that robo-signing is still happening tens of thousands of times every day?,
Most people don’t know. But it is true. This time, it involves buyers of credit-card debt who are robo-suing. Every day, about a dozen of these companies take this procedural shortcut by filing lawsuits to try to use the courts to force people into paying back the debt they’ve defaulted on. These suits have no true legal standing because they violate the most basic principle of theburden of legal proof. That’s because the robo-signers, signing hundreds or thousands of documents a day, don’t take the time to check whether the people they’re suing really owe those debts. These credit-card debt buyers have done this about 40 million times since the financial crisis began in 2008. And they will do it again over and over – about 10 million times a year.
Bernard Madoff ‘did not act alone’ in fraud
Five of Bernard Madoff’s former employees generated millions of pages of fake documents over three years to help the jailed financier trick thousands of investors, a court heard on Wednesday.
The US government made the claims at the start of a five-week trial, in which it will try to prove that Madoff did not act alone in running the biggest Ponzi scheme ever discovered. The disgraced financier, who is currently serving a 150-year prison sentence for fraud, insists he acted alone in the fraudulent scheme which cost investors around $20bn (£12.5bn) before it was exposed in 2008.
However, the US government claims that five of his former staff helped Madoff to “perpetuate [an] elaborate fiction”, in which he claimed that the $300m in certain accounts was actually $68bn. The former staff on trial include his longstanding secretary, Annette Bongiorno; his director of operations for investments, Daniel Bonventre; account manager JoAnn Crupi and computer programmers Jerome O’Hara and George Perez. All the defendants have pleaded not guilty.
For the foregoing reasons, Defendant Bank of New York Mellon’s Motion for Summary Judgment is DENIED. Genuine issues of material fact remain as to whether Countrywide complied with TILA. BONYM has not met its summary judgment burden to demonstrate that it is entitled to a bona fide error defense under 15 U.S.C. § 1640(c). And questions of fact likewise remain as to Plaintiffs’ ability to tender the loan proceeds for purposes of rescission in December 2009.
New York AG Names Investor Protection Chief
New York Attorney General Eric Schneiderman has named a veteran litigator to head the state’s investor-protection bureau.
Chad Johnson will be responsible for enforcement of securities laws and financial oversight, the attorney general announced Wednesday. The previous head of the bureau, Marc Minor, resigned in August.
Johnson joined Schneiderman’s office last year and most recently had been deputy attorney general. He played lead roles in several investigations, including the probe of companies that sold and pooled residential mortgage-backed securities before the financial crisis and the investigation of JPMorgan Chase (JPM) over the information the bank provided shareholders in proxy contests. That investigation led to the bank agreeing to provide shareholders access to interim voting results, the New York attorney general said in his news release.