Schneiderman Proposes Foreclosure Fraud Prevention Act

4

In a push before the end of session next week, Attorney General Eric Schneiderman introduced legislation today to crack down on fraudulent mortgage practices, such as “robosigning” of loans.

The attorney general, who co-chairs President Obama’s mortgage task force, introduced the Foreclosure Fraud Prevention Act of 2012. He said the bill would define “residential mortgage foreclosure fraud” and impose criminal penalties, including jail for violators.

“For many middle class New Yorkers, their life savings is in their home. To take away people’s homes under fraudulent circumstances is a crime deserving of jail time,” Schneiderman said in a statement.

Schneiderman has been a leading voice in the country for greater oversight of the mortgage industry. He pushed the White House last year to not settle with the major banks over mortgage abuse, leading to a larger settlement deal in February.

Schneiderman said the bill has an Assembly sponsor in Assemblywoman Helene Weinstein D-Brooklyn, but he didn’t mention a sponsor in the Senate — where Schneiderman was a member.

The bill would foreclosure abuse a Class A misdemeanor, punishable by up to a year in jail and a $1,000 fine. It would target “an employee or agent of a residential mortgage business” who knowingly authorized, prepared, executed or offered to file false documents in a pending or prospective residential foreclosure action, Schneiderman said.

The bill would make it a E felony, punishable by up to four years in state prison, multiple acts of foreclosure fraud and also makes it a class E felony for a “high managerial agent” of a residential mortgage business to “recklessly tolerate such fraudulent conduct by his or her agents or employees.”

Share.

About Author

4 Comments

  1. I agree with The New York State’s Attorney General!… ( 100%) May Donald Trump & Company may not agree 110%… (Joke)!

    But! This New AG seems to beginning to become a Stand-up Man For The State of New York. Now! This is the Role what defines not only “the Position” but as well his Respects For Rule of Law!

    And, this had not been seen in The Office of Attorney General for a long time! NY seems to be changing its shape towards It’s Reputation .

    God Speed! Mr.Attorney General.

    HABIBHASAN-An American Storyteller

  2. An incredibly weak effort and bill.
    One House sponsor, and no Senate sponsors for this last minute, end-of-session bill that will never have any hearings?

    A 1,000 dollar fine, with a misdemeanor penalty. Your average fraud is in the hundreds of thousands of dollars.

    Punishable as a felony only after multiple acts of fraud?
    Fraud is fraud the first time.

    This bill should not pass, and the AG and his office strongly criticized for this give-away to the mortgage fraud mills and the lawyers who make it possible by manipulating court process without sufficient documentation.

    The courts have already done better than this bill, by requiring certification under penalties of purjery. Chief Judge Jonathan Lippman introduced the requirement in 2010 –years ago– in response to disclosures of deficiencies in residential foreclosure filings nationwide, including affidavits that falsely state the signer has knowledge of the facts.

    The court-required form:
    [____________], Esq., pursuant to CPLR §2106 and under the penalties of perjury, affirms as follows:

    1. I am an attorney at law duly licensed to practice in the state of New York and am affiliated with the Law Firm of __________________, the attorneys of record for Plaintiff in the above-captioned mortgage foreclosure action. As such, I am fully aware of the underlying action, as well as the proceedings had herein.

    2. On [date], I communicated with [name and title], a representative of Plaintiff, who informed me that he/she (a) has personally reviewed plaintiff’s documents and records relating to this case; (b) has reviewed the Summons and Complaint, and all other papers filed in this matter in support of foreclosure; and (c) has confirmed both the factual accuracy of these court filings and the accuracy of the notarizations contained therein.

    3. Based upon my communication with [person specified in ¶2], as well as upon my own inspection of the papers filed with the Court and other diligent inquiry, I certify that, to the best of my knowledge, information, and belief, the Summons and Complaint and all other documents filed in support of this action for foreclosure are complete and accurate in all relevant respects. I understand my continuing obligation to amend this Affirmation in light of newly discovered facts following its filing.

    4. I understand that the Court will rely on this Affirmation in considering the
    application.

  3. What a sad commentary on justice! This AG has already entered into an unfair agreement with the big banks that committed all kinds of fraud, including forgery (robo-signing) and unlawful foreclosures, and there are many, many executives that should be criminally prosecuted for their roles in defrauding the public via CDOs and CDS and so on. It is interesting to see how the Rule of Law is flagrantly abused even by the supposed upholders of the Law! We have a front-row seat in witnessing how justice is being perverted and abused and will eventually be curtailed altogether, but only for the rich!

  4. This act is providing all the details involved right from the existence of the fore closure to the ultimate step of either success or fail. My lawyer had not discussed all these statements regarding the law.