Bank of America, one of the nations largest mortgage servicers, intentionally, knowingly and routinely falsifies paperwork and lies to homeowners in order to remove them from their homes. This is according to Banking Industry insiders and former employees. The latest in the growing list of Civil Suits against BOA has produced affadavits from 6 former employees alleging the bank actively and systematically decieved homeowners and sought foreclosures over modifications that would have kept people in their homes.
A seventh signed affidavit from an employee who worked for one of the bank’s contractors, reinforces the picture of a company wide culture of profits over people. Even a blatant defiance of facts. The banks handling of foreclosures and home loan modifications has drawn the ire of the Federal Government. The documents are part of a lawsuit over the bank’s handling of trial loan modifications under the Home Affordable Modification Program (HAMP), created by the Obama administration. The employees, who worked anywhere from loan origination to collections to reviewing internal loan databases, contend that BOA used a variety of internal policies to discourage loan modifications. The bank encouraged foreclosures, even when loan documents showed the bank’s reasons for foreclosing were untrue.
Blitzing was one method BOA used. Twice a month they instructed case managers to deny any HAMP application more than 60 days old, regardless of whether the information was complete or not. BOA gave $500 bonuses for filling forclosure quotas. An employee who placed 10 or more accounts into foreclosure in a given month got a $500 bonus. They also gave gift cards to Target and Bed, Bath and Beyond for rewards. BOA lied to clients about documentation. Bank policy was to sit on financial documents for 30 days, then label them stale, then require homeowners to reapply.
The sum of allegations is that the bank falsifies documents and knowingly forclosed on borrowers who were in full compliance with modification plans. HAMP, was the Democrats and President Obama’s biggest initiative to the foreclosure crisis. It should have helped 800,000 more people than it did. BOA has already spent $45 billion to settle claims tied to its takeover of Countrywide Financial Corp. Despite settlements like BOA’s, the government has prosecuted more protesters than it has banks, and abuses continue.
The manipulation of the program depicted in these affidavits is more evidence that direct principal reduction would be a more effective use of government housing funds than HAMP’s attempted partnership with banks. Senator Elizabeth Warren has been attacking banks about their shady practices. She has been met with terrific resistance by the Republican party. It seems that they support corporate greed.