By Ariana Eunjung Cha | October 1, 2010; 2:41 PM ET
Connecticut Attorney General Richard Blumenthal on Friday ordered a moratorium on all foreclosures by all banks for 60 days–the most radical action taken by a state on issue of document irregularities.
California also expanded the moratorium on foreclosures it announced last week on Ally Financial foreclosures to include those by J.P. Morgan Chase.
Calling the companies’ review of key foreclosure documents “a ruse,” California Attorney General Jerry Brown (D) ordered J.P. Morgan to prove it is following the law before it continues foreclosures in the state.
Both J.P. Morgan Chase and Ally have frozen foreclosures in 23 states because some employees had signed off on foreclosure paperwork without properly reviewing the files.
Colorado and Illinois have stopped foreclosures by Ally and at least seven other states have launched probes into the issue. But Connecticut is the first to institute an industry-wide ban.
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Washington Post