Daily Archives: August 3, 2017

Borrowers sue Wells Fargo over paid-off mortgage interest

 More problems for Wells Fargo:

Wells Fargo Bank has been hit with a proposed class action accusing it of collecting tens of millions of dollars from Texas borrowers who paid off their mortgages early without providing required disclosures about how to avoid the charges.

Filed on Tuesday in Oakland, California federal court, the lawsuit said Wells Fargo collected interest for the full month that a mortgage was prepaid and did not clearly explain beforehand that the interest could be avoided if borrowers had paid on the first day of the month.

CFPB slaps JPMorgan Chase with $4.6M penalty over checking account problems

The Consumer Financial Protection Bureau hit JPMorgan Chase with a $4.6 million penalty for failures related to information it provides for checking account screening reports.

Under the current process, the bureau explained that banks screen potential customers based on reports about prior checking account behavior created by consumer reporting companies.

Banks, like JPMorgan Chase, that supply information for those reports are legally required to have proper processes in place for reporting accurate information.

The CFPB said Chase did not have these processes in place and kept consumers in the dark about the results of their reporting disputes and key aspects of their checking account application denials.

As a result, the bureau is ordering Chase to pay a $4.6 million penalty and implement necessary changes to its policies to prevent future legal violations.

Read on.

Treasury Secretary just lied under oath and so did a nominee for a top financial-regulatory spot

By David Dayen

The Nation:

In both cases, the lies in question concern OneWest, the properly labeled “foreclosure machine” that caused unnecessary ruin for an untold number of families after the great crash of 2008. I say “untold” because Otting and Mnuchin still refuse to supply basic records of how many families suffered foreclosure at their hands. Several senators asked for this information today without success. Senator Sherrod Brown said that he appealed to Mnuchin six separate times for these records and got no satisfactory response. Brown asked Otting the same question Thursday, and Otting said that the records were in the hands of CIT, which purchased OneWest in 2015, and added that he would “support” release of the data, but “I don’t feel it’s my position to request that information.”

As a mortgage servicer (handling day-to-day operations on loans), OneWest pushed borrowers into foreclosure with bait-and-switch tactics. It presented phony documents to courts as evidence for those evictions. It violated numerous foreclosure laws in California, to the extent that the office of the state attorney general’s consumer-law section wanted to prosecute the bank. In an industry of rogues, OneWest stood out.

But Otting, like Mnuchin before him, maintained that OneWest actually was a white knight, routinely coming to the rescue of homeowners. He touted the low error rate of an after-the-fact review of OneWest’s practices, conducted by reviewers handpicked by the bank under the bank’s own guidelines, and concluded “there’s a false narrative about the OneWest servicing operation.” Senator Brown replied, “It’s a false narrative to you, not to those that lost their homes.”

Brown referred to a 2011 consent order between OneWest and the agency Otting wants to lead, which stated OneWest “filed in state and federal courts numerous affidavits…in which the affiant represented that the assertions in the affidavit were made based on personal knowledge or based on a review…when, in many cases, they were not based on such personal knowledge or review of the relevant books and records.” They also, according to the order, filed documents with courts that were improperly notarized, and not correctly assigned or endorsed to prove ownership.

This is the textbook definition of robosigning. At first Otting dodged the issue, saying that, although he signed the consent order, “we did not confirm or deny the accusations.” But Senator Jon Tester wondered why Otting would sign off on an inaccurate agreement: “I don’t know why you would do that being in business.” So Otting opened up. He said that OneWest had “processes and controls” to review affidavits, though there were “errors from time to time.” He said everything was handled at one location so there could not possibly be problems with notarization because “everybody knew each other.” And he said the affidavit signer “validated principal, past due and amount due” with no errors in every case.

None of this is true. Erica Johnson-Seck, OneWest vice president, testifed on all of this in a deposition in 2009. Among eight people in their office, they signed 6,000 documents a week, mostly affidavits. She proudly boasted, “I have changed my signature considerably.… it’s just an E now,” enabling her to spend “not more than 30 seconds” on each affidavit. It is physically impossible to validate much of anything in 30 seconds of review. In fact, she said outright, “The figures I don’t, I do not check.” She stated she didn’t know who put the figures in the affidavit. She also said that notaries were not in the office when she signed documents, nor are the witnesses.

So Otting just out-and-out lied to Congress, as revealed by what a vice president of the bank he ran said eight years ago.

Trump’s pick for key bank regulator is another Wolf of Wall Street

Joseph Otting signed legal papers admitting the bank he ran forged documents to push Americans out of their homes. He also bought a mansion.

WASHINGTON ― President Donald Trump’s choice to lead a key bank regulation agency spent the first half of this decade running a bank that illegally foreclosed on hundreds of thousands of Americans, often using forged and fraudulent documents.

 

In 2013, halfway through Joseph Otting’s time running OneWest Bank, Otting purchased a Las Vegas “resort lifestyle home” with a “heated pool,” “double doors forged of wrought iron and glass,” “professional-grade theater,” and “far-reaching views of both the golf course and the mountains” for more than $2 million. Today, as he awaits confirmation to lead the Office of the Comptroller of the Currency, the house stands as a monument to the money he made from pushing people out of their homes.

Read on.