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New York AG Cuomo opens investigation into foreclosure problems

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New York Attorney General Andrew Cuomo launched an investigation into Bank of America (BAC), JPMorgan Chase (JPM), Ally Financial (GJM) and Wells Fargo (WFC) for claims regarding faulty foreclosure documents. BofA, JPMorgan Chase, and Ally announced foreclosure suspensions in 23 states, including New York, when employees admitted to signing foreclosure affidavits without reviewing documents or having a notary present. BofA suspended foreclosures in all states. Wells Fargo has continually stood by its affidavits, and has not announced a suspension. "A number of officials have contacted Wells Fargo about our foreclosure process, and we will be sharing our views on the issue of affidavit-signing procedures with them in the near future," Jason Menke, a spokesman for Wells, said. "We remain confident in our controls and procedures for managing this stage of documentation during a foreclosure." PNC Financial (PNC), Goldman Sachs' (GS) Litton Loan Servicing and OneWest Bank have been named as having potential foreclosure issues as well but will not be targeted by Cuomo. Cuomo called for the servicers to submit documents and information in his office concerning how the foreclosure documents are prepared, verified, attested to and notarized. He also asked the servicers not to re-file previously suspended foreclosures until his office has had a chance to review them. One REO broker in Florida told HousingWire three of his previously suspended REO sales for Bank of America have been cleared again. In addition to the investigation, Cuomo called for all servicers to suspend foreclosures in the state, including eviction and REO sales. On Oct. 7, Rep. Edolphus Towns (D-NY), chairman of the House Committee on Oversight and Government Reform, called for top banks to suspend foreclosures and for New York Attorney General Andrew Cuomo to investigate foreclosure practices. "I will not allow New Yorkers to lose their homes due to mortgage goliaths that buck the system by submitting affidavits signed without knowledge of the facts," Cuomo said. "Such conduct is a fraud upon our courts and a slap in the face of New Yorkers struggling to get by in this economy. My office will continue to root out these practices so homeowners receive the full protections afforded by our judicial system." A spokesperson at Cuomo's office said it will join the building coalition of state AGs investigating these claims. Write to Jon Prior. The author holds no relevant investments.

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