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Certification battle in Ohio MERS class action heats up

Certification battle in Ohio MERS class action heats up


Lexology-

On April 23, 2012, the plaintiff in State of Ohio ex rel. David P. Joyce, Prosecuting Attorney of Geauga County Ohio v. MERSCORP, Inc., et al., N.D. Ohio Case No. 1:11-cv-02474, filed its motion seeking an order certifying the action as a class action, appointing Geauga County as class representative, and appointing plaintiff’s counsel, the New York law firm of Bernstein Liebhard LLP, as class counsel. The plaintiff argues that the case, which the plaintiff is attempting to bring on behalf of all 88 Ohio counties for relief relating to the allegedly unlawful failure of MERS and its member institutions to record millions of mortgages and mortgage assignments throughout Ohio, meets all requirements of Rule 23(a) and that certification is proper under any one of the 3 subsections of Rule 23(b). The plaintiff hopes to persuade the court that the MERS/member institution policy concerning recordation of mortgages and assignments is a “common scheme or course of conduct” that has given rise to claims “ideally suited for class certification.”

[LEXOLOGY]

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Alison Frankel: How BofA could lose big if it wins MBIA regulatory challenge

Alison Frankel: How BofA could lose big if it wins MBIA regulatory challenge


Alison Frankel’s On The Case-

I’ve spent a lot of time talking about what I consider Bank of America’s risky gamesmanship in its multi-pronged litigation with the bond insurer MBIA, but it may be that I’ve underestimated that risk by focusing on the downside for the bank in MBIA’s breach of contract and fraud suit. Under a not-implausible scenario, BofA faces serious risk in its regulatory challenge to MBIA’s transformation that’s going to trial on May 14. And ironically, the risk comes not from losing the case — but from winning it.

According to a sophisticated and well-advised MBIA institutional investor that has devoted serious resources to analyzing the issue — trust me, even though the investor doesn’t want to broadcast its involvement, this is a seriously savvy player — if Bank of America and two French banks succeed in overturning MBIA’s 2009 split into separate muni bond and structured finance businesses, there’s a reasonable likelihood that BofA could wind up at the back of the line of MBIA claimants, waiting years for whatever scraps are left over from payouts to municipal bond insurance policyholders.

Here’s why. For all sorts of reasons…

[REUTERS ON THE CASE]

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Abigail C. Field: Assessing Schneiderman’s Task Force Gamble

Abigail C. Field: Assessing Schneiderman’s Task Force Gamble


Abigail Field-

My latest for FireDogLake. For even more confirmation that the Feds aren’t interested in bank accountability, regardless of the State half of the task force’s intentions, see Congressman Brad Miller on why he’s not the task force Executive Director and Richard Eskow on the obviousness of the problem. 

As people increasingly realize that the mortgage settlement was an enforcement fraud, attention’s turned to the “new“ joint Federal/State task force that’s supposed to make the settlement into a “down payment,” by delivering much more. And so far people don’t like what they see, and are saying so. What’s striking about the resulting PR push back, however, is that it just highlights how banker-fraud-friendly our federal government is.

For example, Attorney General Eric Schneiderman penned a Daily News Op-Ed in which he pitches “More than 50 attorneys, investigators and analysts have already been deployed to support our investigations, with many more on the way” as somehow adequate to deliver on that “down payment” promise when the Savings and Loan crisis took over 1,000 and Enron alone took over 100. Not only hasn’t the federal government corroborated AG Schneiderman’s claim of “many more on the way”; “many more” than 50+ doesn’t sound like anywhere near the 1,000+ needed to approach the ballpark of accountability.

[REALITY CHECK]

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Eileen Foster, Former Countrywide Executive, Calls For Investigation Into Cover-Ups

Eileen Foster, Former Countrywide Executive, Calls For Investigation Into Cover-Ups


HuffPO-

A whistleblower who exposed systemic fraud by Countrywide mortgage lenders called on the Department of Justice on Wednesday to prosecute her former colleagues, if not with fraud, then with covering it up.

“If there is insufficient legal evidence to convict these executives of what we believe are obvious crimes, then the federal government should refocus,” Eileen Foster, a former Countrywide fraud investigations chief, told an audience at the National Press Club gathered to honor her and five others for their truth-telling.

“Overwhelming evidence of perjury, witness tampering and obstruction of justice exist in the numerous claims, court filings and trial and investigative transcripts,” Foster said. She herself was fired after reporting that falsified income documentation and faked signatures had been used to steer borrowers into bad mortgages.

[HUFFINGTON POST]

image: iWatchnews.org

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Alison Frankel: Will 2nd Circuit remake AIG’s MBS case against BofA?

Alison Frankel: Will 2nd Circuit remake AIG’s MBS case against BofA?


REUTERS LEGAL-

Mortgage-backed securities litigation has been very good for some of the most obscure laws on the books. I’ve already mentioned the starring role the unheralded statute of repose has taken in bank motions to dismiss securities claims by MBS investors, and we all know about Bank of America’s ingenious (or nefarious, depending on your perspective) use of New York’s Article 77 — a proceeding so rarely invoked that the judge assigned the case had to look it up — to seek approval of its proposed $8.5 billion settlement with investors in Countrywide mortgage-backed notes. Today I bring you the Edge Act, a hundred-year-old law that grants federal-court jurisdiction to civil suits against any U.S corporation in which claims arise from international banking or banking transactions in a U.S. territory.

You’re probably wondering what the Edge Act has to do with U.S. MBS trusts in which securities are backed by U.S.-issued mortgages on properties in the United States. Well, it turns out that a handful of the mortgages backing BofA securities actually originated in the Virgin Islands and Guam. We are talking about a very small handful. According to a brief AIG submitted to the 2nd Circuit Court of Appeals, of the 1.7 million mortgages underlying the 349 MBS trusts at issue in AIG’s $10 billion case against Bank of America, exactly 8 mortgages in 3 trusts originated in U.S. territories.

[REUTERS ON THE CASE]

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The Bankers’ Subversion of the Rule of Law, Notary and Land Records edition

The Bankers’ Subversion of the Rule of Law, Notary and Land Records edition


Abigail C. Filed-

Hi

For the next couple of weeks, I’m one of the David Dayen subs at FireDogLake–no one person could fill his shoes–and this post ran there earlier today. This version is slightly updated but essentially the same.

One way to see the double standard at the heart of the foreclosure fraud—one set of laws for the bailed out banks, one for the rest of us—is to focus on the role of notaries public, and then consider that role in light of what our Supreme Court said about notaries in 1984, in a case called Bernal v. Fainter, Secretary of State of Texas.

First, let’s recap the role of notaries in the foreclosure fraud crisis: Notaries are the people who verify that someone actually is who they say they are when that person signs a document. Because banks and their agents industrialized “Document Execution” as part of their foreclosure business model, notaries did not do their jobs. Notaries’ failure to verify identities has been so complete that many people will sign as one person, say, “Linda Green.” Notaries have also been told to sign documents using one name, and then notarize their own “surrogate” signature. “Well, what’s the big deal?” bank defenders say. Beyond the fact that there’s no “business convenience” exception to following the rule of law, consider Bernal.

Bernal involved Texas’s requirement that all notaries be citizens; lawful permanent resident aliens need not apply. Bernal challenged the Constitutionality for the citizenship requirement. To rule on the question, the Court had to consider what notaries did, and whether or not what notaries did was so political, so central to representative democracy, that limiting being a notary to citizens was rational. In finding that notaries were important but not political officers of the state, the Court made some observations of note.

[REALITY CHECK]

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Foreclosure Threats Even After Loan Modifications

Foreclosure Threats Even After Loan Modifications


WFTV-

A Port Saint John family thought they had avoided disaster after a loan modification was approved.

But  a year later, they claim, Bank of America is foreclosing on their home even though they haven’t missed a mortgage payment since the modification.

Billie Whaley posted three signs  at her  home, all attacking Bank of America.

One reads: “Please help us. Bank of America is trying to steal our home.”

Whaley claims the lender double-crossed her family by approving  a loan modification, taking payments for nearly a year, and now threatening foreclosure.

“I can’t think about it and not cry. We put everything into this home,” Whaley said.

[WFTV]

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Richard (RJ) Eskow: The White House And Mortgage Fraud: So Far It’s All Talk, No Action

Richard (RJ) Eskow: The White House And Mortgage Fraud: So Far It’s All Talk, No Action


HuffPO-

The Obama Administration worked for months on a deal that would have let America’s biggest banks off the hook for a crime wave of runaway mortgage fraud. All they had to do in return was pledge a negligible sum of money, to be paid by their shareholders and not themselves, and which they would dispense themselves. In return, crooked bankers received immunity from prosecution – and even from investigation.

After the deal came under attack from a number of its allies, the Administration settled with the banks anyway. But it promised millions of wronged homeowners – and the nation as a whole – that it would move “aggressively” to investigate criminal misdeeds and prosecute bankers and anyone else who broke the law.

That was then, this is now. Two and half months later the Administration hasn’t even started to take the inadequate steps it promised it would take. The clock is running out on the statute of limitations and there’s no sign that the Administration has lifted a finger to investigate criminal bankers.

Talk vs. Action …

[HUFFINGTON POST]

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Obama’s mortgage unit is AWOL … NY AG Eric Schneiderman should quit this fraud

Obama’s mortgage unit is AWOL … NY AG Eric Schneiderman should quit this fraud


What we have learned so far: Whenever dealing with the banks and or with the government, they are from the same mold. We cannot tell any difference.

This “mortgage task force group” thing is also NO Different than that MERS system…There are no employees!

NY Daily News-

On March 9 — 45 days after the speech and 30 days after the announcement — we met with Schneiderman in New York City and asked him for an update. He had just returned from Washington, where he had been personally looking for office space. As of that date, he had no office, no phones, no staff and no executive director. None of the 55 staff members promised by Holder had materialized. On April 2, we bumped into Schneiderman on a train leaving Washington for New York and learned that the situation was the same.

Tuesday, calls to the Justice Department’s switchboard requesting to be connected with the working group produced the answer, “I really don’t know where to send you.” After being transferred to the attorney general’s office and asking for a phone number for the working group, the answer was, “I’m not aware of one.”

The promises of the President have led to little or no concrete action.

Read more:  [NY DAILY NEWS]

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Israeli Bank Hapoalim sues Bank of America, Merrill Lynch and Countrywide for $720M

Israeli Bank Hapoalim sues Bank of America, Merrill Lynch and Countrywide for $720M


Haaretz-

Bank Hapoalim has filed a massive $720 million suit against Bank of America, Merrill Lynch and Countrywide over its losses in the U.S. subprime crisis, alleging that the U.S. institutions misled and defrauded it.

Among Israel’s financial institutions, Hapoalim suffered the worst losses in the subprime crisis due to its investments in mortgage-backed securities.

Between 2005 and 2007, the bank, led by Shlomo Nehama and Zvi Ziv, snapped up mortgage-backed securities in an attempt to meet its goal of a 15% return on equity by 2007.

[HAARETZ]

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Abigail Field: Hiding the Enforcement Fraud At the Heart of the Mortgage Settlement

Abigail Field: Hiding the Enforcement Fraud At the Heart of the Mortgage Settlement


Abigail C. Field-

On Thursday, April 5th U.S. District Court Judge Rosemary M. Collyer announced she had decided to sign off on the ”$25 billion” Mortgage Settlement. By “announced”, I mean she signed the consent orders all our major law enforcers and the biggest bankers had agreed to, and entered them into the record. Judge Collyer didn’t actually say anything about the deal. She didn’t let anyone else say anything, either: she didn’t hold a public hearing on the deal.

In acting silently, Judge Collyer not only okayed the deal’s lousy terms, which institutionalize servicer theft and foreclosure fraud, she reinforced the incredibly poor public process that’s kept the enforcement fraud at the heart of the deal hidden. Deliberately hidden.

Magical Misdirection

To understand just how deceptive “our” government and “our” law enforcers have been with us

[REALITY CHECK]

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Latest NY appeals ruling is bad news for BofA in monoline cases

Latest NY appeals ruling is bad news for BofA in monoline cases


Alison Frankel-

Ordinarily, there’s not much reason to get excited about a state intermediate appeals court upholding a procedural ruling by a trial court judge. But in the litigation between bond insurers and mortgage-backed securities issuers, decisions are not only magnified by the tens of billions of dollars at stake, but also by the paucity of precedent. Almost every ruling is groundbreaking, which means that decisions have an impact far beyond a single case.

With that in mind, there are two reasons why a ruling Thursday by the New York Appellate Division, First Department, is a setback for Bank of America: timing and authority.

Without much comment, the state appeals court affirmed two rulings by New York State Supreme Court Justice Eileen Bransten, who last fall denied motions by Bank of America to sever and consolidate successor liability claims against the bank in four bond insurer cases against Countrywide. “The court properly exercised its discretion in denying defendant’s motion to sever plaintiffs’ successor liability claims from the primary claims and to consolidate them, for purposes of discovery, in a single action,” the appellate decision said. “The successor liability actions are at completely different stages of discovery, and consolidation would result in undue delay.”

[REUTERS ON THE CASE]

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Ambac v Countrywide | NY App Div., 1st Dept. “denying defendant’s motion to sever plaintiffs’ successor liability claims”

Ambac v Countrywide | NY App Div., 1st Dept. “denying defendant’s motion to sever plaintiffs’ successor liability claims”


Decided on April 5, 2012
Gonzalez, P.J., Tom, Catterson, Renwick, Richter, JJ. 7286N- 7287N- 7288N- 7289N & M-664- M-665-
651612/10 602825/08 650736/09 650042/09 -745

[*1]Ambac Assurance Corp., et al., Plaintiffs-Respondents,

v

Countrywide Home Loans, Inc., et al., Defendants, Bank of America Corp., Defendant-Appellant.

MBIA Insurance Corporation, Plaintiff-Respondent,

v

Countrywide Home Loans, Inc.,et al., Defendants, Bank of America Corp., Defendant-Appellant.

Financial Guaranty Insurance Co., Plaintiff-Respondent,

v

Countrywide Home Loans, Inc.,et al., Defendants, Bank of America Corp., Defendant-Appellant.

Syncora Guarantee, Inc., Plaintiff-Respondent,

v

Countrywide Home Loans, Inc.,et al., Defendants, Bank of America Corp., Defendant-Appellant.

O’Melveny & Myers LLP, New York (Jonathan Rosenberg of
counsel), for appellant.
Patterson Belknap Webb & Tyler LLP, New York (Robert P.
LoBue of counsel), for Ambac Assurance Corp. and The
Segregated Account of Ambac Assurance Corporation, respondents.
Quinn Emanuel Urquhart & Sullivan, LLP, New York (Peter
E. Calamari of counsel), for MBIA Insurance Corporation,
respondent.
Kutak Rock LLP, New York (Robert A. Jaffe of counsel), for
Financial Guaranty Insurance Co., respondent.
Allegaert Berger & Vogel LLP, New York (David A. Berger of
counsel), for Syncora Guarantee, Inc., respondent.

Orders, Supreme Court, New York County (Eileen Bransten, J.), entered October 31, 2011 and November 2, 2011, which, among other things, denied defendant Bank of America Corp.’s motions to sever and consolidate plaintiffs’ successor liability claims for purposes of discovery, and held in abeyance defendant’s motion to consolidate the successor liability claims for purposes of trial, unanimously affirmed, with costs.

This is a consolidated appeal involving four related but separate claims by monoline insurers for primary liability against the Countrywide defendants in connection with financial guarantee insurance covering mortgage-backed securities. The actions also involve successor liability against defendant Bank of America. The court properly exercised its discretion in denying defendant’s motion to sever plaintiffs’ successor liability claims from the primary claims and to consolidate them, for purposes of discovery, in a single action. The successor liability actions are at completely different stages of
discovery, and consolidation would result in undue delay (see Barnes v Cathers & Dembrosky, 5 AD3d 122 [2004]).

M-664 -Syncora Guarantee Inc. v Countrywide Home Loans, Inc., et al. and Bank of America Corp.

M-665 -MBIA Insurance Corporation v Countrywide Home Loans, Inc., et al. and Bank of America Corp.

M-745 -MBIA Insurance Corporation, et al. v Countrywide Home Loans, Inc., [*2]et al. and Bank of America Corp.

Motions to supplement the record on appeal (M-664, M-665) granted; cross motion to strike the supplemental record and reply brief, or for leave to supplement the record in the event the motion (M-665) is granted (M-745), granted to the extent of granting leave to supplement the record.

THIS CONSTITUTES THE DECISION AND ORDER
OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.

ENTERED: APRIL 5, 2012

CLERK

[ipaper docId=88657343 access_key=key-1i7t2yobucg5b3s5zqos height=600 width=600 /]

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Angry priest pulls church money out of Bank of America, Joins a nationwide interfaith movement

Angry priest pulls church money out of Bank of America, Joins a nationwide interfaith movement


The Edge-

Father Robert Rien, of St Ignatius at Antioch, a Catholic church east of San Francisco, speaks with a crisp buoyant voice that belies his 65 years. When he is angry it fairly crackles.

This Lenten season he is angry at America’s big banks, so angry he has pulled all his parish’s money out of the Bank of America and opened accounts at a small local bank.

He has called on his flock to do the same and joined a nationwide interfaith movement dedicated to divesting from the major banks. They see Lent as the perfect time to spread the word.

”We have a mandate from the gospels to act,” says Father Rien.

”Jesus went to the temple and he challenged the banking system of his day. He said, ‘you are thieves and marauders, you are wrong in what you are doing’.” On Ash Wednesday this year a group of San Francisco clergy spilled ashes outside a Wells Fargo ATM and called for a foreclosure sabbatical, invoking the Biblical term for the ancient practice of forgiving debts.

Read more: http://www.theage.com.au

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Churches Moving Money Out Of Big Banks In Protest Of Foreclosure Actions

Churches Moving Money Out Of Big Banks In Protest Of Foreclosure Actions


HuffPO-

For lent this year, some will inevitably give up the usual guilty pleasures like chocolate or meat. More than a few churches are taking a decidedly different approach.

About 25 churches have withdrawn $16 million from big banks such as Wells Fargo, Bank of America and JPMorgan Chase as part of a Lent-themed protest against the banks’ foreclosure actions, The New York Times reports, citing PICO National Network, a social justice coalition of churches that’s leading the charge. Individual members and organizational partners have also taken out an additional $15 million.

The demonstration, which started on Ash Wednesday, aims to protest “the injustice that still dominates the banking industry in this country, unmasking corporate greed and dishonesty that is destroying our families,” Ryan J. Bell, senior pastor Hollywood Seventh Day Adventist Church, wrote in a blog for The Huffington Post last month.

[HUFFINGTON POST]

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[VIDEO] Shaun Donovan on the Foreclosure Fraud Settlement & Wish Wash

[VIDEO] Shaun Donovan on the Foreclosure Fraud Settlement & Wish Wash


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BREAKING: The $25B Foreclosure Fraud settlement has been approved by U.S. District Judge Rosemary Collyer.

BREAKING: The $25B Foreclosure Fraud settlement has been approved by U.S. District Judge Rosemary Collyer.


Via

Nothing from the consent judgment entered into court in the $25B foreclosure settlement may constitute “evidence against Defendant.”

WSJ-

The settlement was announced in February and filed in court as a consent judgment last month. Judge Rosemary Collyer approved the landmark settlement on Wednesday. The signed order was filed in U.S. District Court for the District of Columbia.

The pact will offer reductions in loan principal and other assistance to qualifying homeowners. The largest portion of the aid, valued at $17 billion, goes to borrowers at risk of foreclosure. Banks will pay $5 billion in fines, including nearly $1 billion to the Federal Housing Administration.

[WALL STREET JOURNAL]

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Amicus Brief of Oregon AG John Kroger on Hooker v Northwest Trustee, BofA & MERS lawsuit pending before the 9th U.S. Circuit Court of Appeals.

Amicus Brief of Oregon AG John Kroger on Hooker v Northwest Trustee, BofA & MERS lawsuit pending before the 9th U.S. Circuit Court of Appeals.


Hi/5 Dan Marsh

IN THE UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT

IVAN HOOKER, KATHERINE HOOKER

v.

NORTHWEST TRUSTEE SERVICES, INC.;
BANK OF AMERICA, N.A.; MORTGAGE ELECTRONIC
REGISTRATION SYSTEMS, INC.,

[ipaper docId=87906947 access_key=key-1d94q5wlnt1hwjjwo1ha height=600 width=600 /]

 

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Review Finds Possible Flaws in More Than 138,000 Bank Foreclosures

Review Finds Possible Flaws in More Than 138,000 Bank Foreclosures


Not this word again “Flaw”…it’s FULL   B L O W N   FRAUD!

Why wasn’t this review done prior to any settlement? Because they never began any investigation.

DealBook-

The nation’s biggest banks may have put the huge $25 billion settlement over bad foreclosure practices behind them, but that doesn’t mean their mortgage troubles are over.

A separate review — this time by independent consultants on behalf of the Office of the Comptroller of the Currency — flagged more than 138,000 cases for possible flaws in the foreclosure process at the nation’s largest mortgage servicers. Those include foreclosures involved with the so-called robo-signing scandal, in which bank representatives churned through hundreds of documents a day in foreclosure proceedings without reviewing them for accuracy.

[DEALBOOK]

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Alison Frankel: Why NY businesses should worry about BofA’s new MBS defense

Alison Frankel: Why NY businesses should worry about BofA’s new MBS defense


Reuters Legal-

U.S. District Judge Mariana Pfaelzer of federal court in Los Angeles is poised to deliver a ruling in AIG’s mortgage-backed securities case against Countrywide that could have an impact on just about every company headquartered in New York. The issue: How long do N.Y. businesses have to bring fraud claims? Are they entitled to the benefit of the state’s generous six-year statute of limitations? Or, as Countrywide argues in a supplemental motion to dismiss filed on March 23, are companies headquartered in New York instead restricted to the generally stingier time limits in their states of incorporation?

To understand how this question arose in AIG’s MBS case, we have to back up a few steps. It’s no secret that in MBS litigation, there’s no more potent defense than arguments that investors waited too long to file suit. It’s a quick, clean way to excise big chunks of a plaintiff’s case, particularly because federal securities claims, with exceptions for American Pipe tolling (if you don’t know, don’t ask), are generally time-barred after three years under the statute of limitations or the more-obscure-until-MBS-litigation statute of repose. That’s why we’ve seen so many MBS plaintiffs — including AIG and the satellite insurance companies that are also plaintiffs in its Countrywide suit — assert state-law fraud claims in addition to federal securities claims.

[ON THE CASE REUTERS]

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Utah AG: We will fight foreclosure ruling Judge said BofA’s actions in Utah are governed by Texas laws.

Utah AG: We will fight foreclosure ruling Judge said BofA’s actions in Utah are governed by Texas laws.


“Texas does not pass banking laws for Utah,” Assist. AG Jerrold Jensen wrote. “And Utah does not pass banking laws for Texas.”

The Salt Lake Tribune-

The Attorney General’s Office is seeking to intervene in a lawsuit in which a federal judge has ruled that Texas law governs foreclosures carried out by a unit of Bank of America in Utah.

The Feb. 8 ruling by U.S. District Judge Ted Stewart “is not something the State of Utah can let pass,” Assistant Attorney General Jerrold Jensen wrote in seeking to intervene in the lawsuit.

Federal judges in Utah have split over the question of whether BofA’s foreclosure arm, ReconTrust, may have violated state law in thousands of actions taken in recent years against Utah homeowners.

Stewart ruled that because ReconTrust is headquartered in Texas, where it carries out many of its foreclosure functions, the National Bank Act says the bank’s actions are governed by that state’s laws.

[THE SALT LAKE TRIBUNE]

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Borrower Beware: B of A Customer Repaid Her Bill Yet Faced a Collections Nightmare

Borrower Beware: B of A Customer Repaid Her Bill Yet Faced a Collections Nightmare


American Banker-

Karen Stevens spent nearly $1,900 paying off delinquent credit card debt she owed Bank of America in 2006. She then spent another three years fending off demands from collections agencies that she repay the debt all over again. Neither a cancelled check or creditor’s letter stating that she’d fulfilled her obligations deterred the collectors.

Stevens ended the nightmare only by hiring a lawyer and counter-suing her pursuers. Bank of America was not directly involved in the legal contretemps, but it appears to have set them off by selling rights to Stevens’ account, even after assuring her she’d paid up in full.

[AMERICAN BANKER]

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