Tags: Banks | Probe | Home | Insurance

BofA, Other Banks Said Being Probed Over Home Insurance

Wednesday, 11 Jan 2012 11:37 AM


  Comment  |
   Contact Us  |
|  A   A  
  Copy Shortlink
The New York state's financial regulator is probing several large banks, including Bank of America Corp. and Citigroup Inc., on whether they overcharged customers on force-place insurance, a source familiar with the matter said.

The probe centers on so-called force-place insurance — where the loan servicer steps in and buys an insurance policy in the event of a homeowner failing to keep up their insurance premiums — an increasingly common practice, the source said.

JPMorgan Chase & Co. and Wells Fargo & Co. are among the other major banks involved in the inquiry by the office of Benjamin Lawsky, the superintendent of New York State's Department of Financial Services, the source said.

Lawsky's office has been probing banks and insurance companies on whether they are overcharging on forced place insurance, the source, who declined to be named as the matter was private, said.

Lawsky was formerly an official in the New York State Attorney General's Office under Andrew Cuomo, now the state's governor.

In the State Attorney General's Office, Lawsky was involved in other probes of banks, including a high-profile investigation of the U.S. student loan industry.

The present probe would look into whether policies being taken up by the investigated banks were issued by their own affiliates. Kickbacks between unrelated companies would also face scrutiny, according the source.

An important focus for the probe will be the potential conflict at Bank of America involving a unit called Balboa Insurance that it owned until last year, the source said.

A Bank of America spokesperson declined to comment on the investigation but said it is the bank's policy to cooperate with regulatory investigations.

The investigation will also probe JPMorgan because in recent years the bank held a small financial stake in an insurance company called Assurant on behalf of its clients, the source said.

Citigroup, Wells Fargo and JPMorgan could not be reached for a comment outside of normal business hours.

The Office of the Superintendent of New York State's Department of Financial Services could not be reached immediately for a comment.

© 2014 Thomson/Reuters. All rights reserved.

  Comment  |
   Contact Us  |
  Copy Shortlink
Around the Web
Join the Newsmax Community
Please review Community Guidelines before posting a comment.
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
Retype Email:
Zip Code:
Hot Topics
Follow Newsmax
Like us
on Facebook
Follow us
on Twitter
Add us
on Google Plus
Around the Web
You May Also Like

Obama Fundraiser Shuns the Press to Drown Protests

Friday, 25 Jul 2014 08:40 AM

It's no wonder President Obama tries to lock his normally fawning liberal media out of his fundraisers. He says things h . . .

American Exceptionalism Lost on Obama

Tuesday, 22 Jul 2014 07:57 AM

Efforts to proclaim moral equivalence are not always misguided; sometimes each side is equally at fault or close enough. . . .

Let's Not Accept Govt Overreach

Friday, 18 Jul 2014 11:18 AM

I don't think Congress should begin impeachment proceedings against President Obama right now. . . .

Most Commented

Newsmax, Moneynews, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, NewsmaxWorld, NewsmaxHealth, are trademarks of Newsmax Media, Inc.

America's News Page
©  Newsmax Media, Inc.
All Rights Reserved