AZ and NV AGs Sue Bank of America for Alleged Deceptive Loan Mod Activities

Arizona Attorney General Terry Goddard, and Attorney General Catherine Cortez Masto, both announced lawsuits against Bank of America Corporation and its affiliates for allegedly engaging in deceptive trade practices and violations of state consumer fraud statutes relating to loan modification activities.


A copy of the Arizona AG’s complaint is available at:

http://www.azag.gov/press_releases/dec/2010/BofAComplaint.pdf

A copy of the Nevada AG’s complaint is available at:

http://ag.state.nv.us/newsroom/press/2010/Bank%20of%20America%20Filed%20Complaint.pdf
The AGs’ complaints allege that Bank of America is supposedly:

1) “Misleading consumers by promising to act upon requests for mortgage modifications within a specific period of time;”

2) “Misleading consumers with false assurances that their homes would not be foreclosed while their requests for modifications were pending, but sending foreclosure notices, scheduling auction dates, and even selling consumers’ homes while they waited for decisions;”

3) “Misrepresenting to consumers that they must be in default on their mortgages to be eligible for modifications when, in fact, current borrowers are eligible for assistance;

4) “Making false promises to consumers that their modifications would be made permanent if they successfully completed trial modification periods, but then failing to convert these modifications;”

5) “Misleading consumers with inaccurate and deceptive reasons for denying their requests for modifications;”

6) “Falsely notifying consumers or credit reporting agencies that consumers are in default when they are not;”

7) “Misleading consumers with offers of modifications on one set of terms, but then providing them with agreements on different sets of terms, or misrepresenting that consumers have been approved for modifications.”

The Arizona AG’s complaint also asserts that Bank of America is violating the March 13, 2009 consent judgment with Countrywide. In the consent judgment, Countrywide agreed to develop and implement a loan modification program for certain former Countrywide borrowers in Arizona. Bank of America assumed responsibility for Countrywide’s compliance with the consent judgment.

The Arizona complaint alleges that, instead of providing the relief to which eligible homeowners were entitled, Bank of America supposedly failed to make timely decisions on modification requests and proceeded with foreclosures while modification requests were pending in violation of the agreement.