USA Today is reporting that Bank of America, as the purchaser of Countrywide, is paying $108 Million in penalty to the Federal Trade Commission (to be distributed amongst the effected parties). The FTC discovered that Countrywide was charging excessive fees to home owners who were facing foreclosure. These fees were for things like property inspections and landscaping (I assume that means mowing). What Countrywide was doing was creating wholly owned subsidiaries to arrange for the services and then bill the accounts at an inflated price.
At the very bottom the article also mentions that Countrywide has been known to misrepresent the nature, and amounts due on loans, it looks like they may have discovered some false Bankruptcy claims and concealed fees. This should be shocking. It isn’t. I sued Countrywide for its bankruptcy related accounting practices a few years ago. What is more disturbing is that these practices, or variants on them, are widespread throughout the industry.
We don’t let debtors lie, cheat or steal in Bankruptcy. It is high time we stopped letting creditors do it.