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Attorneys General to Unveil Foreclosure Probe

HeadlineOct 13, 2010

Attorneys general from dozens of states are announcing a joint investigation today into alleged fraud by the nation’s biggest lenders in forcing thousands of people out of their homes. The probe will center around allegations mortgage companies including Bank of America, JPMorgan Chase and Ally Financial made misleading or fraudulent statements and signed off on documents without proper review to approve scores of foreclosures. Also Tuesday, Ally Financial announced it’s widened an independent audit of foreclosure practices at its GMAC Mortgage unit to all fifty states. Ally and JPMorgan Chase have suspended foreclosures in twenty-three states, while Bank of America has suspended them in all fifty states. Last week, Ohio filed a lawsuit accusing Ally of fraud in approving hundreds of foreclosures. The Obama administration meanwhile has renewed its opposition to a nationwide moratorium on foreclosures. On Tuesday, White House Press Secretary Robert Gibbs said a foreclosure freeze could cause “broader harm… to the housing market and to the housing recovery.”

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