Articles Posted in Banking

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The Eleventh Circuit affirmed the district court's grant of summary judgment for Wells Fargo, a mortgage servicer, in an action alleging that Wells Fargo failed to conduct a reasonable investigation into the accuracy of its credit reporting of her mortgage loan, in violation of the Fair Credit Reporting Act (FCRA). The court held that plaintiff could not prevail on her claim against Wells Fargo under section 1681s-2(b) of the FCRA without identifying some fact in the record establishing that the information Wells Fargo reported regarding her account was inaccurate or incomplete. In this case, regardless of whether plaintiff may have been confused about how her account would be reported to the credit rating agencies, and whether Wells Fargo could have better explained to her how the account would be reported, she did not meet her payment obligations under the note. Finally, any omissions did not render plaintiff's credit report misleading. View "Felts v. Wells Fargo Bank, N.A." on Justia Law

Posted in: Banking, Consumer Law

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The Eleventh Circuit certified the following question to the Supreme Court of Georgia: 1) Whether Georgia's apportionment statute, O.C.G.A. 51-12-33, applies to tort claims for purely pecuniary losses against bank directors and officers; 2) whether section 51-12-33 abrogated Georgia's common-law rule imposing joint and several liability on tortfeasors who act in concert; and 3) whether, in a negligence action premised upon the negligence of individual board members in their decisionmaking processes, a decision of a bank's board of directors is a "concerted action" such that the board members should be held jointly and severally liable for negligence. View "Federal Deposit Insurance Corporation v. Loudermilk" on Justia Law

Posted in: Banking, Business Law

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The Eleventh Circuit affirmed the district court's denial of RBC's motion to compel arbitration. Plaintiff held a checking account with RBC and filed suit alleging that RBC failed to properly warn him of possible overdrafts at points of sale when he used his debit card and impermissibly rearranged the order of debit-card transactions so as to process larger transactions before smaller transactions. The court found it unnecessary to address the questions of waiver or the district court's alternative holding. Rather, the court held that PNC failed to demonstrate the requisite meeting of the minds to support a finding that the parties agreed through the February 2013 amendment to arbitrate their then-pending litigation. View "Dasher v. RBC Bank (USA)" on Justia Law

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The Eleventh Circuit affirmed the district court's denial of RBC's motion to compel arbitration. Plaintiff held a checking account with RBC and filed suit alleging that RBC failed to properly warn him of possible overdrafts at points of sale when he used his debit card and impermissibly rearranged the order of debit-card transactions so as to process larger transactions before smaller transactions. The court found it unnecessary to address the questions of waiver or the district court's alternative holding. Rather, the court held that PNC failed to demonstrate the requisite meeting of the minds to support a finding that the parties agreed through the February 2013 amendment to arbitrate their then-pending litigation. View "Dasher v. RBC Bank (USA)" on Justia Law

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Cita Trust appealed the district court's dismissal of its complaint against Fifth Third Bank in a commercial contract dispute action. The Eleventh Circuit affirmed, holding that the district court did not err by dismissing the complaint as untimely and enforcing the contractual one-year limitation period. In this case, the agreement's limitation provision was reasonable, clear, and unambiguous. Furthermore, the district court did not abuse its discretion when it denied Cita leave to amend its complaint, because Cita did not properly move for leave to amend. View "Cita Trust Company AG v. Fifth Third Bank" on Justia Law

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The M/V Deep Blue purchased fuel from a supplier, the supplier purchased the fuel from an affiliate, and the affiliate subcontracted with Radcliff. Radcliff subsequently asserted a maritime lien on the Deep Blue in a bid to recover directly from the ship, giving rise to this litigation. The Fifth Circuit affirmed the district court's determination that Radcliff did not have a lien on the Deep Blue. Instead, a lien had arisen in favor of the global fuel supplier, and was duly assigned to ING Bank, an intervenor in the suit. View "Barcliff, LLC v. M/V Deep Blue" on Justia Law

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The Eleventh Circuit reversed the district court's denial of KeyBank's motion to compel arbitration on grounds of unconscionability. The court looked to Ohio law to determine where plaintiff consented to arbitrate; plaintiff consented to the 1997 Agreement and its arbitration provision; plaintiff's argument that he did not assent to the revised version of the arbitration provision that appearred in the 2009 Agreement failed; and summary judgment was warranted in this case. The court also held that the district court erred in finding the 2009 Arbitration Provision unenforceable under applicable state law. The court remanded to the district court to compel arbitration. View "Johnson v. Keybank National Assoc." on Justia Law

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In 2009, the SEC initiated the Nadel action following the collapse of a Ponzi scheme perpetrated by Arthur Nadel. In 2010, the district court entered an order establishing a claims administration process by which potential claimants could file proof of their claims against the receivership. Wells Fargo submitted a Proof of Claim as to its loan that secured one receivership property within the set claim bar date, but did not submit a Proof of Claim detailing its secured interest in the other two receivership properties. In 2012, Wells Fargo submitted a motion seeking a determination that the filing of Proofs of Claim was unnecessary to preserve its security interests in, and claims against, collateral in the Receiver's possession. In the alternative, Wells Fargo sought leave to file belated claims. The district court granted the Receiver's motion seeking a determination that Wells Fargo's failure to submit Proofs of Claim for the loans secured by two properties extinguished its interests in those properties, and the release of the proceeds from the sale of one of the properties for which Wells Fargo did not file a Proof of Claim. Determining that Wells Fargo's appeal was timely, the court concluded that the district court erred when it terminated Wells Fargo's security interest in the properties at issue. The court found bankruptcy law was both analogous and instructive here. The court reasoned that, in the bankruptcy context, a secured creditor’s lien remains intact through the bankruptcy, regardless of whether the creditor files a proof of claim. In this case, the court concluded that Wells Fargo's security interests remained intact as to the two properties for which it did not file a Proof of Claim in the district court. Accordingly, the court reversed and remanded. View "SEC v. Wells Fargo Bank, N.A." on Justia Law

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Plaintiff appeals the district court’s denial of his motion for reconsideration of its earlier order denying on futility grounds plaintiff's motion for leave to amend his complaint. Plaintiff asserted in his motion that he had developed facts in discovery which showed that (1) a Bank employee knew that Charles Gordon, the chief executive officer of OPT Title and Escrow, Inc., had assisted Gordon in opening a bank account called an “escrow account” into which funds were to be wired by third parties with the expectation that the funds would be held in escrow by OPT Title; (2) the Bank employee knew that Gordon was stealing from the account; (3) the Bank employee assisted Gordon in committing the fraud; and (4) the Bank received at least a short-term financial benefit from allowing Gordon to use OPT Title’s account as a vehicle for his fraud. The court held that the district court erred in denying plaintiff's motion for reconsideration on the basis that even considering his new allegations set forth in his motion for reconsideration, he failed to state claims for relief. Accordingly, the court reversed and remanded for further proceedings. View "Hsi Chang v. JPMorgan Chase Bank, N.A." on Justia Law

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Under Regulation X, 12 C.F. R. part 1024, which implements the Real Estate Settlement Procedures Act (RESPA), 12 U.S.C. 2601 et seq., a loan servicer’s duty to evaluate a borrower’s loss mitigation application is triggered only when the borrower submits the application more than 37 days before the foreclosure sale. At issue is whether Ocwen, a loan servicer, had a duty to evaluate an application for loss mitigation options submitted by the Borrowers when, at the time the application was submitted, a foreclosure sale of the Borrowers’ property was scheduled to occur in two days. The court concluded that Regulation X requires the court to measure the timeliness of the Borrowers’ application using the date the foreclosure sale was scheduled to occur when they submitted their complete application. Because the Borrowers’ application was untimely, the court agreed with the district court that Ocwen had no duty to evaluate the Borrowers’ loss mitigation application. Therefore, the court affirmed the district court’s grant of summary judgment to Ocwen on the Borrowers’ claim seeking to hold Ocwen liable for failing to evaluate their loss mitigation application. The court also affirmed the district court’s grant of summary judgment with respect to the Borrowers’ claim based on Ocwen’s inadequate response to their notice of error. The court agreed with the district court that to survive summary judgment the Borrowers had to present evidence that they suffered actual damages or were entitled to statutory damages and that they failed to do so. View "Lage v. Ocwen Loan Servicing LLC" on Justia Law