October 12, 2010 / 7:23 PM / 7 years ago

New York's Cuomo expands foreclosure probe

NEW YORK (Reuters) - New York State Attorney General Andrew Cuomo demanded more information on home foreclosures from Bank of America, JPMorgan Chase, Wells Fargo and GMAC Mortgage/Ally on Tuesday and called for the suspension of “robo-signing” documents.

Cuomo said in a statement he wants mortgage servicers to submit documents and information to his office on how foreclosure documents are prepared, verified, attested to and notarized, and how required notices are provided in the state.

He called “robo-signing” a “fraud upon our courts and a slap in the face of New Yorkers struggling to get by in this economy.”

Democratic legislators in Washington D.C. are pushing for the largest mortgage lenders to suspend foreclosures in all 50 states following allegations some banks used shoddy paperwork to kick struggling borrowers out of their homes.

As soon as Wednesday, 40 U.S. state attorneys general were expected to make public a joint probe into the foreclosure allegations, sources briefed on the announcement plans said.

The investigations stem from allegations that banks and companies that collect monthly mortgage payments have used “robo-signers” — people who signed thousands of affidavits without properly reviewing them.

“My office will continue to root out these practices so homeowners receive the full protections afforded by our judicial system,” said Cuomo, a Democrat running for election in November to become New York governor.

Bank of America, which announced on Friday it had stopped foreclosure sales nationwide while it completed a review, said in response that it will work with Cuomo and other attorneys general to address their concerns.

“We believe this approach demonstrates appropriate concern and a responsible approach until our review is complete.”

A spokesman for GMAC Mortgage/Ally declined to comment on the Cuomo announcement.

But the company said in a statement on Tuesday that it has been reviewing cases involving judicial affidavits in 23 states for about two months “and found no evidence to date of any inappropriate foreclosures.”

Wells Fargo spokeswoman Vickee Adams said that in response to requests from elected officials, customers and other agencies “we have decided to invoke additional reviews on all pending foreclosures.”

Representatives for JPMorgan Chase could not immediately be reached to comment.

Additional reporting by Elinor Comlay; Editing by John O'Callaghan and Tim Dobbyn

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