Aug. 26 — The U.S. Trustee Program announced Aug. 25 that it has reached an agreement with Wells Fargo Bank, N.A. requiring the bank to pay close to $3.5 million in remediation on account of 8,000 homeowners in Chapter 13 bankruptcy.
Wells Fargo and the USTP filed an amendment to a prior settlement entered in a Maryland Chapter 13 bankruptcy case on Nov. 19, 2015 (In re Green, Bankr. D. Md., No. 11-33377-TJC, 8/25/16 ), according to a press release sent to Bloomberg BNA.
The amendment is the result of an independent reviewer’s oversight of Wells Fargo practices with regard to filing and serving payment change notices in active Chapter 13 cases, and increase payments to be made by the bank by approximately $3.5 million. Wells Fargo previously agreed to pay about $81.6 million in remediation for “its repeated failure to provide homeowners with payment change notices (PCNs) as required under federal bankruptcy law,” the USTP, a branch of the U.S. Department of Justice, told Bloomberg BNA in an Aug. 25 e-mail.
In a Chapter 7 bankruptcy case in the SDNY Judge Drain has been really angry at Wells Fargo for its b.s. docs including an assignment of mortgage notarized two days before the mortgage existed. In the attached order (issued today), he not only denies the relief from stay and not only awards fees but also says:
“ORDERED that the entry of this Order is without prejudice to the right of any party interest, including, without limitation, the United States Trustee, to seek further relief based on the alleged improper filing of false documents with the Court.”
Full order below…
Thomson Reuters News & Insight.
Residential Capital LLC needs to do more to ensure it is protecting consumer privacy for homeowners under bankruptcy law in the sales of its mortgage loan and servicing businesses, the U.S. Trustee said in court papers on Monday.
Tracy Hope Davis, who represents the U.S. Justice Department in the bankruptcy, also challenged the potential break-up fee and other parts of an auction process for those businesses. She said they would discourage bidders from participating.
ResCap, the mortgage unit of Ally Financial, filed for bankruptcy in May with a plan to sell its mortgage servicing business for about $2.4 billion to Nationstar Mortgage Holdings, owned by Fortress Investment Group. It also plans to sell some mortgage loans to Ally for about $1.4 billion.
Ally is the former in-house financing arm for General Motors Co, and was previously known as GMAC. Ally is not in bankruptcy.
At the time of the ResCap bankruptcy, the mortgage company filed court papers detailing procedures it plans to follow for the sales.