Feds drop $25 billion hammer on robosigning banks
On behalf of Ellett Law Offices , P.C. posted in 1. Personal Bankruptcy on Friday, March 23, 2012
Many Phoenix, Arizona residents have mortgaged homes, and a portion of them struggle on the edge of foreclosure. Tough economic times and inflated unemployment rates contribute to the situation, but as many have been discussing in the past two years, robosigning permeated throughout the mortgage industry and led to many illegitimate foreclosures.
What is robosigning? Like the name implies, it is the robotic and thoughtless process of bank employees signing off on massive amounts of mortgage and foreclosure paperwork without verifying the actual contents of the documents. They just “do,” in an effort to clear as much paperwork as possible. The result? Fraudulent and incorrect documents that cost thousands of homeowners untold amounts of money and immeasurable amounts of stress and grief.
Recently the U.S. Department of Housing and Urban Development cracked down on robosigning, completing its investigation of the illegal practice. They handed out $25 billion in fines to a number of financial institutions, such as Bank of America, Wells Fargo, Ally Financial, JP Morgan Chase and Citigroup.
HUD found a number of robosigning violations. Specific to Bank of America, HUD says that the bank’s employees signed affidavits and foreclosure documents. The employees then claimed they knew what was contained within the signed documents, when in reality they did not. Unnamed Bank of America employees that aided the investigation claimed that sometimes an employee would sign hundreds of documents a day — stacks of paper that were 18 inches high — without looking over the paperwork.
In addition, attorneys and notaries at the company falsified work documents and lied about witnessing certain signatures.
Source: Charlotte Business Journal, “Feds confirm robosigning at Bank of America, Wells Fargo and others,” Adam O’Daniel, Mar. 13, 2012
Tags: foreclosure, personal bankruptcy, robosigning