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‘I begged them for help’: Wells Fargo foreclosure nightmare

New York (CNN Business)Foreclosures can be extremely painful events. Imagine finding out years later that it was all a big mistake.

That’s exactly what happened to Jeff and Eva Reiner. The couple turned to Wells Fargo (WFC), their mortgage servicer, for help making their payments after Eva, the family’s breadwinner, was laid off by Verizon (VZ) in 2010.

“We were desperate. I begged them for help,” Eva Reiner told CNN Business.

But Wells Fargo did not accept their requests for a mortgage modification for their beloved 6-acre property in rural South Carolina. Wells Fargo eventually foreclosed on the home, forcing the couple to move their teenage son, give up three dogs and forfeit the equity they had built up in the house.

This fall, the Reiners learned from media reports they were among the approximately 545 homeowners who lost their homes because of an apparent software glitch with Wells Fargo’s loan modification process.

Read on.

Trump administration hid report revealing Wells Fargo charged high fees to students

The Trump administration for months concealed a report that showed Wells Fargo charged college students fees that were on average several times higher than some of its competitors.

The “unpublished” report was obtained by POLITICO through a Freedom of Information Act request. It was produced by the Consumer Financial Protection Bureau office previously led by Seth Frotman, who quit as the bureau’s top student loan official in protest of Trump administration policies. Frotman said in his resignation letter that CFPB leaders had “suppressed the publication” of the report.

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Kushners’ Beachfront Strip Eligible for Trump’s Poor-Area Tax Perks

The opportunity zones in the new tax law are supposed to attract investment to low-income areas. But some of these neighborhoods aren’t exactly struggling.

Pier Village promotes itself as a “jewel on the New Jersey coast.” It features Victorian-inspired oceanfront apartments, a pool club, and expensive restaurants. At a shoreline property built by Extell Development Co. in partnership with Kushner Cos., 786-square-foot one-bedroom apartments are being marketed for as much as $2,765 a month. At an adjacent development site, Kushner Cos. is constructing a 72-room luxury hotel.

The area is also, officially, distressed. That’s because this section of Long Branch, N.J., has been deemed an “opportunity zone,” a classification created in President Trump’s 2017 tax law, meant to spur investment in poor communities. Real estate developers are eligible for generous perks that include deferring some taxes and avoiding them altogether on future capital gains from projects in these areas if they own them for more than a decade. Kushner Cos. is one of many developers buying into about 9,000 opportunity zones across the country.

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Congress may have accidentally freed nearly all banks from the Volcker Rule

A few double negatives buried in legislative text may have inadvertently freed nearly all U.S. banks from a regulation known as the Volcker Rule, which sought to curb risky behavior in response to the 2008 financial crisis.

The text in question comes from a package bill passed in May that pared back portions of the Dodd-Frank post-crisis financial regulatory framework. One of the many provisions of the bill offered an exemption from the Volcker Rule to smaller community banks that policymakers felt were burdened by the regulation, whichlimited banks’ proprietary trading, or trading for their own accounts.

But sources tell Yahoo Finance that some of the largest U.S. banks are now thinking about challenging the interpretation of that May legislation in court, arguing that the bill could be read as also extending regulatory relief to banks far above $10 billion in assets.

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BANK OF AMERICA ALERTS SF WOMAN TO FRAUDULENT CHARGES, THEN DENIES IT WAS FRAUD

SAN FRANCISCO – When your bank alerts you to a fraudulent charge on your debit card – and you confirm it’s not yours, the bank will stop the payment to the scammer.

Right?

That’s what a Bay Area woman thought. Instead, the bank, weeks later, told her she had to prove someone was stealing money out of her account.

“It was surreal,” Sarah Fiene of San Francisco. “It felt surreal. How could this be happening?

Fiene says she was at work when she received a robocall from Bank of America.

“It said, ‘We suspect some fraudulent activity on your debit card.’,” Fiene recalled. “It gave a number to call to find out what was going on.”

She called the number immediately, but had to wait on hold for 40 minutes. A customer service representative asked Fiene if she had made a $372 purchase to a telecom company. Fiene had never heard of it.

“I said no I did not authorize this charge,” Fiene said. “I don’t recognize this company. ”

She was still on the phone as more charges came in.

Read on.

Predatory lending practices chewing up small businesses across America

Look out, the stranger on the phone warned. They’re coming for you.

The caller had Janelle Duncan’s attention. Perpetually peppy at 53, with sparkly jewelry and a glittery manicure, Duncan was running a struggling Florida real estate agency with her husband, Doug. She began each day in prayer, a vanilla latte in her hand and her Maltese Shih Tzu, Coco, on her lap, asking God for business to pick up. She’d answered the phone that Friday morning in January hoping it would be a new client looking for a home in the Tampa suburbs.

The man identified himself as a debt counselor. He described a bizarre legal proceeding that he said was targeting Duncan without her knowledge. A lender called ABC had filed a court judgment against her in the state of New York and was planning to seize her possessions. “I’m not sure if they already froze your bank accounts, but they are RIGHT NOW moving to do just that,” he’d written in an email earlier that day. He described the lender as “EXTREMLY AGGRESSIVE.” Her only hope, the man said, was to pull all her money out of the bank  immediately.

Read on. (Hat tip from Bloomberg)

How Confessions of Judgment Work

 

Small Business

Wants a loan

The Confession

Borrower signs a confession of judgment as part of the application, agreeing to lose any dispute

Lender

Sends money to borrower

The Dispute

Borrower misses a payment, or so the lender claims

County Clerk

Lender sends confession to clerk,

who rubber-stamps it

New York City Marshal

Demands money from borrower’s bank

Bank

Hands money over to lender

Lender

Gets money back, with interest and fees tacked on.

Wells Fargo knew for years that auto insurance was hurting customers, lawsuit says

New York (CNN Business)Wells Fargo executives were warned that the bank’s auto insurance program was harming customers four years before it was shut down, according to a lawsuit.

Wells Fargo admitted last year to charging hundreds of thousands of borrowersfor auto insurance they didn’t need. Some customers even had their vehicles repossessed because of the needless charges.

Members of Wells Fargo’s executive risk management committee were alerted in April and July 2012 to “critical issues” about the insurance program known as collateral protection insurance, or CPI, a complaint unsealed by a judge on Monday alleges.

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Wells Fargo admits more than 500 customers lost their homes due to ‘calculation error’

After an internal review, the troubled bank said it found that 870 customers were erroneously denied mortgage changes, with 545 of them losing their homes as a result of the error. The bank first reported the mistake in August, but said only 645 eligible borrowers were denied and of those, 400 lost their homes. The bank added that it had fixed the glitch and put $8 million aside to compensate borrowers this summer, but it hasn’t updated that number since admitting more customers have been impacted.

Reuters, which first reported the news, cited an underwriting error that internally prompted the bank to reject home loan modifications instead of helping them.

In an email to FOX Business, Tom Goyda, a Wells Fargo spokesperson said: “We’re very sorry that the errors occurred and have assigned a single, dedicated point of contact to ensure that each customer is engaged with and assisted individually.”

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Wall Street moves to gut post-crisis financial rules

ON THE CAMPAIGN trail, Donald Trump frequently pledged to “dismantle” the Dodd-Frank financial reforms passed in the wake of the 2008 financial crisis. On Wednesday, with the Federal Reserve’s release of a proposal to roll back capital and liquidity requirements, he caught his big whale.

Those requirements, imposed by the Dodd-Frank Act, were put in place to ensure that critical financial institutions could weather economic storms. The liquidity ratio was only finalized in September 2014. And yet, just four years later, on October 31, the Federal Reserve announced proposed changes that would reduce liquidity requirements by almost a third for banks such as Capital One and Charles Schwab with assets of $250 billion to $700 billion. Smaller banks would have even fewer restrictions.

In the lone dissent on the Fed’s four-member board, Lael Brainard said she could not support the proposal, which, among other things, would “weaken the buffers that are core to the resilience of our system.”

Read on.