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Attorney General Patrick Lynch Joins Nationwide Foreclosure Fiasco Investigation

Thursday, October 14, 2010

 

Since the nation’s four largest lenders have come under scrutiny for “robo-signing” foreclosures, Attorney General Patrick Lynch yesterday that he will join officials in 49 states and the District of Columbia in the investigation of the mortgage industry’s alleged fraud and abuse. According to data released Thursday by RealtyTrac Inc., a foreclosure listing service, 288,345 properties nationwide were lost to foreclosure in the July-September quarter. However, thousands of foreclosures have now been halted as both internal and external investigations continue.

Widespread Abuse

“It’s with dismay and disbelief that I learned that major lenders submitted affidavits in 23 states that were signed by people with no personal knowledge of what they were representing, presumably under oath, to numerous Courts,” Lynch said in a statement. “In one case alone it appears that GMAC/Ally tasked one person to sign as many as 10,000 affidavits a month.”

In a 2009 settlement with Countrywide, 185 Rhode Island families shared $546,939 in foreclosure relief funds that Lynch’s settlement guaranteed. In a 2007 settlement with Ameriquest, Lynch recovered more than $3.8 million in restitution payments for Rhode Island residents who had been victimized by Ameriquest’s predatory lending schemes. Lynch’s participation in a multistate Household Finance Corporation settlement ensured that $1.4 million was disbursed to Rhode Island consumers victimized by that company’s predatory lending practices in 2003. In January 2009, Lynch joined with other AGs in urging Congress to take steps to permit federal Bankruptcy Courts to protect families from foreclosure.
 

 

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