Some of the largest US banks are accused of defrauding veterans and taxpayers out of hundreds of millions of dollars. Wells Fargo, Bank of America, JP Morgan Chase and GMAC have been accused in a suit of charging illegal hidden fees within home refinancing packages.
According to one of the lawyers involved, “This is a massive fraud on the American taxpayers and American veterans.” Ironically, it was the practice of hiding attorney fees and settlement closing fees within the mortgages that is the source of the fraud.
The program was aimed at active duty military and veterans with VA Home loans. Veterans and their families refinanced more than 1.2 million loans over the past decade. Of those, up to 90 percent of the loans were impacted by this fraud.
These same banks collected hundreds of millions of dollars in hidden fees, and obtained hundreds of millions of dollars in loans they would not have received, otherwise.
For example, according to the Bank Fraud Lawsuit, the banks were charging fees of $950 for title examination fees when the usual range for a fee is $150-200. This may not seem like a lot if it were one instance, but spread over 1.2 million loans it is substantial.
In fact, if that example is the average, then banks may have defrauded veterans of almost $1 billion.