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Connecticut attorney general probes GMAC mortgage

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Connecticut Attorney General Richard Blumenthal is probing GMAC Mortgage, one of the nation's largest servicers of home loans, over what he claims are "defective foreclosure documents" filed in Connecticut. Mr. Blumenthal is demanding that GMAC Mortgage, a unit of Ally Financial Inc., freeze all foreclosures in the state. Ally Financial is majority-owned by the U.S. government. "The bank's apparent failure to follow basic legal procedure—a potential fraud on the court—is appalling and unacceptable," Mr. Blumenthal said. "Our investigation will enable strong legal action against GMAC/Ally, if warranted by the facts and the law. I will fight to assure the banks comply with clear legal requirements that protect homeowners from unfair foreclosures of their homes."

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