The Scandal Surrounding Bank of America and the Robo Signing Case
- August 6, 2013
- Foreclosure Market
Bank of America, although proudly being the largest financial institution in the United States and serving clientele from over 150 countries, came into the news yet again. Along with other money lending institutions in the United States, it was for what has commonly become known as the “robo” signing case.
Bank of America had already attracted itself enough negative publicity with the Meryl Lynch incident and the multi fraud accusations made against the institution by public services such as hospitals and schools in 2010. Now it has found itself in the top headlines again in the fall of 2010 for the “robo” signing case.
“Robo” signing has been used by many financial institutions besides Bank of America, such as JP Morgan Chase and Allied Financial. All of these companies being involved with the recent scandal.
“Robo” signing has taken place in hundreds of thousands of foreclosure property deals, where the bank, instead of in some cases going to court to legally acquire the foreclosed or REO property, have “robo” signed numerous documents. Hence stands the question of who do some of these properties from Bank of America foreclosures actually belong to and where do potential buyers stand who already made a deposit or down payment on a property before the scandal unfolded.
The answer is that there is now a great shortage of foreclosure properties for sale. Also, there are hundreds of thousands of people who may potentially lose their homes because it was not the legal property of the bank or lending organization to sell.
The complications become endless, and the “robo” signing case has left a huge dent in the real estate market of the United States as well as a lot of uncertain property owners. Although Bank of America made a pledge to stop “robo” signing in all 50 states, it would physically be impossible to re-read and re-sign all of the already “robo” signed documentation for so many foreclosure properties. For the re-signing and re- reading of all the documents to take place, Bank of America would actually have to employ a great deal of personnel on a temporary basis just to complete this task.
So although a pledge to stop “robo” signing has been given by Bank of America, it still does not help the unfortunate individuals who have unknowingly been caught up with this scandal while innocently trying to purchase their dream property. Quite a bit must still be done to resolve this issue of immense proportions. This all has caused more bad publicity for Bank of America that they don’t need.