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Entries in Robo-Signers (4)

Monday
Aug132012

Collectors Robo-Signing for Credit Card Debt Suits

BananaStock/Thinkstock(WASHINGTON) -- Reminiscent of the foreclosure crisis, a number of credit card companies that are suing to collect their debt are said to be “flawed” and point to “robo-signing” or “robo-testimony.”

“I would say that roughly 90 percent of the credit card lawsuits are flawed and can’t prove the person owes the debt,” said Brooklyn civil court judge Noach Dear, according to the New York Times.

Companies like American Express have filed lawsuits that judges have dismissed because one employee who testified provided generic testimony about the company’s records, which the judge called “robo-testimony.”

American Express sued Felicia Tancreto last year, alleging she owed more than $16,000 on her credit card and had stopped making payments.

Sonya Conway, spokeswoman for American Express told ABC News that the company “strongly disagrees” with Judge Dear’s comments and “we feels consistency of testimony is a good practice.”

“To introduce business records into evidence, similar foundational questions are asked in each case in order to comply with the applicable rules of evidence,” Conway said. “The process of establishing a defaulted customer debt for evidentiary purposes should not change from one case to the next given that our processes are consistent for all customers. However, when this was done in the Tancreto case, Judge Dear characterized the questions and responses as ‘robo-testimony’.”

Adam Levin, co-founder of Credit.com and an ABCNews.com columnist, said “none of this surprises me,” and he recommends consumers speak with an attorney or their state consumer affairs agency if they are told they owe money on a debt that was not processed properly or is not theirs.

“[The credit card companies] are in a frenzy right now to make up for money they’re losing after the government restricted the insane fees these institutions were charging,” Levin said.

Some lawsuits include falsified credit card statements, the New York Times reports.

Tom Pahl, assistant director for the Federal Trade Commission’s division of financial practices told the Times, “Our concerns center on the fact that debt collection lawsuits are a pure volume business.”

Emily Collins, spokeswoman for Citigroup, said “we continually review the effectiveness of our controls and policies for credit card collections, and ensure that affidavits are validated for accuracy and signed by Citi employees with knowledge of the client’s account."

"Citi Cards has a range of programs to support our clients who may be facing financial difficulty, and we make every effort to work with our clients to prevent delinquency,” she continued.

Copyright 2012 ABC News Radio

Thursday
Feb092012

Feds Announce $25B Foreclosure Abuse Deal

Office of the Maine Attorney General(WASHINGTON) -- Government officials announced on Thursday a record $25 billion settlement with the five biggest banks related to foreclosure abuses, including "robo-signing" of documents.

Among the money allocated will be $1.5 billion distributed nationwide to about 750,000 borrowers who lost their homes to foreclosure. The deal is the largest multi-state settlement since the Tobacco Settlement in 1998, the Department of Justice said.

Five banks -- Wells Fargo, Bank of America, Citigroup, JPMorgan Chase and Ally Financial -- will also have to "work off up to $17 billion in principal reduction and other forms of loan modification relief nationwide," and "provide up to $3 billion in refinancing relief nationwide," according to the settlement.

Attorney General Eric Holder said the deal by 49 state attorneys general, who worked late into the hours of Wednesday night, does not preclude states from pursuing their own suits against the banks.

Holder announced further terms of the deal would be on a website, NationalMortgageSettlement.com, and residents of the states involved should visit the sites of their respective attorneys general.

Department of Housing and Urban Development Secretary Shaun Donovan said the settlement holds banks accountable for abuses against homeowners, which "continued long after people got the keys to their new home."

"No more lost paperwork, no more excuses, no more rhetoric," Donovan continued.

Donovan said the investigation comprised at least 15,000 hours of reviewing thousands of files of Federal Housing Administration insured loans.

Copyright 2012 ABC News Radio

Thursday
Feb092012

Multi-Million Dollar Settlement over Foreclosure Abuses Near

iStockPhoto/Thinkstock(NEW YORK) -- Federal and state officials are near a multi-billion dollar settlement with five of the nation's biggest banks over foreclosure abuses that took place during the housing crisis, ABC News has learned.

The Department of Justice will hold a press conference at 10 a.m. Thursday to announce an agreement in principal.

At least 42 states have agreed to sign onto the agreement.  New York and California were among the last holdouts and it wasn't clear whether they will join or sue separately.

The deal is estimated to be $25 billion and would involve Wells Fargo, Bank of America, Citigroup, JPMorgan Chase and Ally Financial.

Some of the money would go towards foreclosure prevention measures, such as lowering the loan balance for homeowners who are underwater, while other provisions could lower interest rates.

Another chunk would be set aside to compensate people who lost their homes.  Those homeowners may may get payouts of up to $2,000.

The settlement comes after banks were found to have taken part in "robo-signing" to speed up foreclosures after the housing bubble burst.  The practice involved the mass signing documents without verifying the accuracy of the paperwork.

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Copyright 2012 ABC News Radio

Monday
Mar072011

Officials Hope for Foreclosure Deal Within Two Months

ABC News (WASHINGTON) -- Federal officials leading the investigation into allegations that mortgage companies broke state laws when processing foreclosures said Monday they hope to agree on a final settlement with banks within two months.
 
“What we’re really trying to do is change a dysfunctional system....We’re hopeful that we can reach a resolution that will be good for homeowners and good for the banks in the long run and most importantly good for the country,” Iowa Attorney General Tom Miller, who is leading the 50-state investigation, told reporters at a press conference in Washington on Monday.
 
Miller said he is hopeful they can wrap up the process in the next two months. “I mean a soft two, not quite a literal two, but I’m hoping,” he said.
 
North Carolina Attorney General Roy Cooper warned they should move quickly so uncertainty doesn’t linger too long. “We realize that the result that we come to can have an impact on the housing market and hence the economy. That’s why all of us at the table want it to be a positive impact and part of that is moving as quickly as we can,” he said.
 
Regulators and the state attorneys general are hoping to negotiate a settlement over the reported mortgage servicing problems, including the use of so-called “robo-signers” who rushed foreclosures through the system without properly reviewing the details of the cases.
 
Copyright 2011 ABC News Radio 







ABC News Radio