Thursday, December 1, 2011
Big Banks get sued for unethical practices
This article talks about a recent lawsuit filed by the state of Massachusetts against JP Morgan, CitiGroup, and Bank of America for highly unethical foreclosure practices. The lawsuit claims that the banks seized many homes they had no legal right to seize since they did not own the mortgages on the properties. The lawsuit also accuses the banks of "robosigning" , which is when employees sign mortgage documents without even reading them, using false signatures, and /or not having proper witnesses present. Its amazing how unethical many of the leading banks' practices are, even after the housing crisis hit. It just makes you shake your head at the culture of greed that these banks have fostered at the detriment of their customers.
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The fact Massachusetts filed a lawsuit in the midst of settlement negotiations should show the severity of the situation. We just learned in class how banks acted recklessly when loaning money to sub-prime borrowers or bundling mortgages for hedge fund investments. The whole Occupy movement is centered around this corporate greed and lawsuits like these just reaffirm the greedy actions of banks.
ReplyDeleteI think a lawsuit is a good idea. Clearly these banks played an enormous role in the creation of the recession, mostly as a result of sketchy and misleading banking and loaning practices. Hopefully this is a step towards better regulation of the banking industry, so that things don't get too out of hand again in the future.
ReplyDeleteI also think its a good idea this will teach the bank not to be as careless or why not to taking advantages of their customers. Since banks played a major role on the economy especially when the top big too failed happened.
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