The Resolution Law Group: Bank of America’s Countrywide to Pay $17.3M RMBS Settlement to Massachusetts

According to Massachusetts Attorney General Martha Coakley, Countrywide Securities Corp. (CFC) will pay $17 million to settle residential mortgage backed securities claims. The settlement includes $6 million to be paid to the Commonwealth and $11.3 million to investors with the Pension Reserves Investment Management Board. Countrywide is a Bank of America (BAC) unit.

Coakley’s office was the first in the US to start probing and pursuing Wall Street securitization firms for their involvement in the subprime mortgage crisis. Other RMBS settlements Massachusetts has reached include: $34M from JPMorgan Chase & Co. (JPM), $36M from Barclays Bank (ADR), $52 million from Royal Bank of Scotland (RBS), $102 million from Morgan Stanley (MS), and $60 million from Goldman Sachs. (GS).

Meantime, a federal judge is expected to rule soon on how much Bank of America will pay in a securities fraud verdict related to the faulty mortgages that Countrywide sold investors. A jury had found the bank and ex-Countrywide executive Rebecca Mairone liable for defrauding Freddie Mac and Fannie Mae via the sale of loans through that banking unit. The US government wants Bank of America to pay $863.6 million in damages. Mairone denies any wrongdoing.

The case focused on “High Speed Swim Lane,” a mortgage lending process that rewarded employees for the volume of loans produced rather than the quality. Checkpoints that should have made sure the loans were solid were eliminated.

In other recent Countrywide news, a federal judge has given final approval to Bank of America’s $500 million settlement with investors who say the unit misled them, which is why they even invested in high-risk mortgage debt. A number of investors, including union and public pension funds, said they were given offering documents about home loans backing the securities that they purchased and that the content of this paperwork was misleading. They contend that a lot of securities came with high credit ratings that ended up falling to “junk status” as conditions in the market deteriorated.

This payout is the biggest thus far to resolve federal class action securities litigation involving mortgage-backed securities. The second largest was the $315 million reached with Merrill Lynch (MER), which is also a Bank of America unit. That agreement was approved in 2012.

Also, Bank of America was recently named the defendant in a lawsuit filed by the California city of Los Angeles over allegedly discriminatory lending practices that the plaintiff says played a part in causing foreclosures. LA is also suing Citigroup (C) and Wells Fargo (WFC).

The city says that Bank of America offered “predatory” loan terms that led to discrimination against minority borrowers. This resulted in foreclosures that caused the City’s property-tax revenues to decline. BofA, Wells Fargo, and Citibank have said that the claims are baseless.

If you feel you are the victim of Securities Fraud, please do not hesitate to email or call the The Resolution Law Group (203) 542-7275 for a confidential, no obligation consultation.

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The Resolution Law Group: Why Complex Litigation?

A complex Tort Litigation lawsuit may be the best defense against your loan servicer, investor or lender who knowingly or negligently originated mortgages and exposed borrowers to economic risks they were not aware of or fully understood.

A legal claim may help homeowners hold the banks responsible for unlawful foreclosures.

A key issue, in consideration of all applicable laws and rules governing lawyers in most states, and the nature of the claims alleged by homeowners against the banks and applicable laws regarding those claims, is whether and how homeowners who were induced to take mortgages from these banks can seek redress for alleged wrongs.

A Complex Tort Litigation case is not about emergency relief–it won’t stop a foreclosure, or get a house back.It may or may not induce the bank to take favorable action as to modifying a loan or placing a hold on foreclosure actions.  Those decisions will most likely be unilateral actions taken by the bank, not actions mandated by the court.

Complex Tort Litigation cases are a longer term potential remedy intended to seek financial damages and restitution for wrongs allegedly committed by the banks and other defendants.

Who is a potential client for multi-party litigation?

  • A client who has had some sort of change in circumstances: either the client lost income, or had a severe decrease in the value of his/her property–or both.
  • A client can also have no financial difficulties and be current on their mortgage payments.
  • Any loan transaction handled by MERS
  • Loans that were securitized
  • A client may have already lost the home due to illegal or premature foreclosure action.

If you suspect that you are the victim of Mortgage Fraud, do not hesitate to email or call please contact The Resolution Law Group at (203) 542-7275 for a confidential, no obligation consultation.

Lender Litigation, Unlawful Foreclosure, Tarp Money, Mortgage Backed Securities, Derivitives Lawsuits, Insider Trading Lawsuit, SEC Settlements, Ponzi Scheme Lawsuits, Intentional Misrepresentation, Securitized Mortgage, Class Action Securities Lawsuit, Robo-Signing Lawsuit, Lost Equity Litigation, Mortgage Lender Fraud, FINRA Fraud Lawsuit, Suing Banks, Fraudulent Misrepresentation, Short Sale Fraud, Fraudulent Business Practices, Mortgage Litigation, Complex Tort Litigation, Injunctive Relief, MERS Fraud

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The Resolution Law Group Lender Litigation: You Might Have A Legal Case If…

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You Might Have A Legal Case If…

  • Your broker falsified your income.

  • Your broker hid his or her fees.

  • You weren’t immediately given a copy of the good-faith estimate and weren’t given an accurate HUD-1 statement breaking down all fees at closing.

  • After signing the contract to refinance your mortgage, you didn’t walk out with a “notice of recission” that explains your rights to cancel the refinance within three business days.

  • You were led into a subprime loan although your credit would have qualified you for a better loan.

  • Your mortgage company lied or decieved you.

  • Your loan was securitized.

  • Your loan transaction was handled by MERS.

  • You were denied for a Loan Modification.

If you, your family, friends, neighbors or associates have been subjected to Mortgage Fraud, please contact The Resolution Law Group at (203) 542-7275 for a confidential, no obligation consultation.

The Resolution Law Group: Lender Litigation

Complex Tort Plaintiff Litigation – Suit Overview

•Named bank defendants are in the business of origination of residential mortgages.

•Following origination, the banks securitized the loans and sold them as investments.

•The banks pooled the loans before sale as a means of inflating their value.

•This evolved into a comprehensive scheme to inflate property values as a means of inflating their profits.

It is alleged that the banks were aware that these practices would create a real estate bubble, which would devastate their borrowers when it popped. At the time the banks originated the loans, they concealed from the borrowers that their loans would be securitized and sold to unknown third parties.

•Further, the banks concealed that their individual loans were part of a massive, fraudulent scheme to inflate property values.

•The banks were under a duty to disclose these details to each borrower.  The bubble eventually popped, in 2008, and devastated homeowners.

•The bank defendants thus systematically destroyed home values across the nation.

•Plaintiffs lost equity in their homes, suffered damage to their credit profiles, an incurred other damage.

About Securitization

Securitization takes a commonplace, mundane transaction and makes very strange things happen. It is argued that in the case of a securitized mortgage note, there is no party who has the lawful right to enforce a foreclosure, and the payments alleged to have been in default have, in fact, been paid to the party to whom such payments were due.

Additionally, in the case of a securitized note, there are rules and restrictions that have been imposed upon the purported debtor that are extrinsic to the note and mortgage* as executed by the mortgagor and mortgagee, rendering the note and mortgage unenforceable.

It may be that as it now stands, a lawful foreclosure cannot occur against a mortgage whose note has been securitized because of the lack of an actual damaged party who has standing to state a claim.  The note may well be unenforceable because the unnamed parties who are receiving the pre-tax income from the entity are the real parties in interest. They hold the legal and/or equitable interest in the mortgages held, but they do not have the ability to foreclose on any one individual mortgage because the mortgages held by the REMIC have all been bundled into one big income-producing unit.

The Resolution Law Group, along with attorneys across the country, are pressing this cause of action to enforce relief to homeowners at risk of foreclosure. State rulings are coming down on this side of the issue, in support of the homeowner.

We approach every client’s transaction history, with their lender, and that lenders’ history with its servicers, originators, and the loan funding history, with an aggressive and extensive forensic support alliance. Our auditors are some of the most experienced in this emerging area of lender litigation. Our securitization and funding auditors, FFS SEC, have dismantled thousands of mortgage originations to expose the trail of transferred debt ownership, that is the foundation of emerging foreclosure defense.

EXAMPLE OF SEC REPORT

Causes of Action

Fraudulent Concealment

•The banks were in possession of information regarding their underwriting guidelines, securitization practices, and the inflation of property values, when it entered into mortgages with the plaintiff borrowers.

•The banks had a duty to disclose this information to borrowers.

•The banks made material misrepresentations regarding this information, and otherwise concealed the information from borrowers.

•The plaintiffs relied on this misinformation in deciding to enter their loans.

•The plaintiffs were subsequently damaged as a result of these circumstances.

Intentional Misrepresentation

•The banks made misrepresentations regarding their business practices, as detailed above, with the intent of inducing borrowers to sign home loans.

•The plaintiffs relied on these misrepresentations in entering the loans.

•As a result of this, the plaintiffs were damaged.

Negligent Misrepresentation

•Same cause as intentional misrepresentations, but in this charge it is alleged that, even if the misrepresentations were not intentional, they were negligent in that, a reasonable bank acting in good faith would not have made the same misrepresentations.

Injunctive Relief

•The banks violated these laws by basing foreclosure actions on false records.

Unfair Competition

•The bad faith business practices of the banks, as outlined above, constitute unfair competition, and violate State law.

Breach of Contract

•The banks accepted TARP money, and in so doing, were required to use this money to modify home loans, creating a contract.

•The banks did not perform this obligation, and thus breached this contract

If you, your family, friends, neighbors or associates have been subjected to Mortgage Fraud, please contact The Resolution Law Group at (203) 542-7275 for a confidential, no obligation consultation.

Lender Litigation, Unlawful Foreclosure, Tarp Money, Mortgage Backed Securities, Derivitives Lawsuits, Insider Trading Lawsuit, SEC Settlements, Ponzi Scheme Lawsuits, Intentional Misrepresentation, Securitized Mortgage, Class Action Securities Lawsuit, Robo-Signing Lawsuit, Lost Equity Litigation, Mortgage Lender Fraud, FINRA Fraud Lawsuit, Suing Banks, Fraudulent Misrepresentation, Short Sale Fraud, Fraudulent Business Practices, Mortgage Litigation, Complex Tort Litigation, Injunctive Relief, MERS Fraud