The True Color of Race — The Struggle to Stop Predatory Lending and Foreclosure Fraud in Urban America; U.S. Government Issues New Guidelines to Prevent Predatory Lending
D.C. Resident files $3 Million Federal Lawsuit against ABN AMRO Mortgage Group and Baltimore-based law firm for fraud, civil conspiracy and consumer protection violations
Washington, D.C. (PRWEB) February 8, 2005 -- At a time when home ownership
rates are soaring, a quiet epidemic is swirling through Urban America: predatory
lending and foreclosure fraud by unscrupulous mortgage companies seeking to
swindle urban homeowners out of properties with appraised values that
dramatically exceed the value of the mortgages held. Mr. Calvert M. Wilson, an
African-American and a lifelong District of Columbia resident, was one such
victim. On January 19th, 2005, Mr. Wilson and the Washington office of
Tennessee’s Andrews & Bowe, PLLP, filed a $3.0 million federal lawsuit
against ABN AMRO Mortgage Group, Inc. (“ABN AMRO”) and certain attorneys with
the Baltimore, MD based law firm of Friedman & MacFayden, PA (the “Friedman
Law Firm”) alleging that ABN AMRO and representatives of the Friedman Law Firm
concocted a scheme to defraud him out of his residence in the lucrative
Northeast Capitol corridor of D.C. [Wilson v. ABN AMRO Mortgage Group, Inc. et
al., No. 1:05-CV-00108 (D.D.C. filed Jan. 19, 2005).
According to
allegations in the federal lawsuit, on several occasions ABN AMRO artificially
increased the amounts allegedly due under Mr. Wilson’s mortgage account for his
home in Northeast D.C., declared a default when he could not pay the
artificially inflated sums, and then hired the Friedman Law Firm to pursue
foreclosure of his home. The lawsuit also contends that the value of the home
has increased substantially since it was purchased by Mr. Wilson in December
1996, and is now worth at least four times the value of the note on ABN AMRO’s
books, according to a recent property appraisal.
When Mr. Wilson and his
lawyers made verbal and written requests for back up information on the source
of the mortgage payment increases and related charges, ABN AMRO and the Friedman
Law Firm either feigned ignorance about the matter or refused to provide actual
details concerning Mr. Wilson’s mortgage account. In addition to these alleged
abuses, the lawsuit also states that as a result of ABN AMRO’s misconduct, Mr.
Wilson was forced to obtain a short term, sub-prime loan from a third party
finance company to cure the default, and further, that on more than one
occasion, when Mr. Wilson attempted to pay off the debt, the Friedman Law Firm,
apparently on instructions from ABN AMRO, refused to take his money.
“I
did everything they asked me to do, and they still tried to take my property,”
said Mr. Wilson. “God has blessed me with the strength to overcome this
obstacle. As a working man, I felt it was my duty to fight to save my property
not only for myself and my family, but for all the other hard-working folks who
are up against it like myself. I was not going to let AMRO or anybody else take
my property without fighting for it. This lawsuit is about more than just money
or home-ownership, it is about the survival of the American Dream for all
working folks”, added Mr. Wilson. Mr. Wilson’s Attorney also was stunned by the
unlawful and cold-hearted manner in which his client was mistreated by ABN AMRO
and its lawyers.
"Mr. Wilson’s case represents yet another instance when
African Americans and Latin Americans are offered financial products and
services that are designed not only to exploit individuals, but our community as
a whole, by placing home ownership, the very cornerstone of the 'American
Dream', out of our reach.” said attorney Rawle Andrews Jr., lead counsel for Mr.
Wilson in the federal lawsuit.
"It’s equally discouraging and disgusting
that in 2005, a large, multi-national corporation like ABN AMRO is more
concerned with getting its way than respecting the law, and the rights of its
customers. ABN AMRO’s blatant and repeated manipulation of the loan terms of Mr.
Wilson’s mortgage, which prevented him from remaining current on his payments,
and the Friedman Law Firm’s apparent willingness to aid and abet this
misconduct, show a pattern and practice of fraud and abuse by both the
foreign-owned bank and its outside attorneys that cannot be tolerated or
excused.” Andrews added.
The filing of Wilson’s lawsuit is not the only
recent attack on predatory lending. On February 2, 2005, the U.S. Office of the
Comptroller of the Currency (OCC), a federal agency, issued new Residential Real
Estate Lending Standards. These new federal standards (Title 12 CFR Part 30) are
specifically designed to stop the wide-spread practice of predatory lending by
large banks, mortgage companies, sub-prime financiers, mortgage brokers, and
their affiliates.
“The decision by the federal government to issue new
standards to curb predatory lending drives home the point that Mr. Wilson’s
problem is not just an isolated incident in Urban America. Predatory Lending is
an 'American Nightmare' that affects homeowners in 'Red States and Blue States'
through out this country. Although we applaud the Federal Government’s decision
to issue new mortgage lending standards, it remains to be seen whether this is a
first down or a touchdown in the struggle to stop predatory lending and
foreclosure fraud. With all the time and billons of dollars that these big banks
and mortgage companies have invested in maintaining the status quo, it would be
premature to think that any of these lenders are going to raise the white flag
simply because the federal government and consumers have drawn the line on these
illegal business practices.” stated Andrews.
As part of the lawsuit, Mr.
Wilson is requesting that the D.C. Federal Court issue an injunction to stop
these allegedly unlawful and inequitable foreclosure and collection activities
against him, an order directing ABN AMRO to make corrections to his credit
report, and $3.0 million in compensatory and punitive damages to remedy the
fraud and abuse directed against him.
No trial date has been set in the
case.
Related Links:
Predatory Lending and Foreclosure Fraud Impacts
Minorities Most
http://www.greaterdiversity.com/mt_career/archives/2005/02/predatory_lendi.html
Predatory
Lending: Inner City Press Releases Analysis of Mortgage Disparities; HOEPA Loans
Are Still Being Made, Banks Break Prior Commitments
http://newswire.ascribe.org/cgi-bin/behold.pl?ascribeid=20050417.215433&time=07%2030%20PDT&year=2005&public=0
The
Office of the Comptroller of the Currency (OCC) Issues Guidelines to Prevent
Predatory Residential Mortgage Lending Practices:
http://www.occ.treas.gov/scripts/newsrelease.aspx?Doc=ERNFCQX9.xml
U.S.
Senate Banking Committee: Questions Treasury, FED on Handling of ABN AMRO
http://banking.senate.gov/index.cfm?Fuseaction=Articles.Detail&Article_id=67&Month=10&Year=2004
Federal
Reserve Board (FRB): Supervisory Agreement with ABN AMRO Bank to improve
anti-money laundering procedures and practices
http://www.federalreserve.gov/boarddocs/press/enforcement/2004/20040726/
ABN
AMRO PowerPoint Presentation to the N.Y. Federal Reserve Bank regarding Quality
Control Problems
http://www.newyorkfed.org/newsevents/events/banking/2003/con0529h.pdf
NCRC Releases Best and Worst Lenders: A Consumers' Guide Lenders Ranked in
25 Metropolitan Areas
http://www.ncrc.org/policy/cra/best_worst_03.php?section=cra/best_worst_03
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Source : http://www.prweb.com/releases/2005/2/prweb206198.htm