Citigroup agreed to pay $285 million to settle a fraud lawsuit filed by its investors, who were understandably irate that Citigroup was selling them toxic assets while betting against those same assets. The lawsuit was not related to all the damage Citigroup did to honest, hardworking Americans with that same fraud. Nobody sues for that kind of thing in this country.
In not-surprising-but-still-enraging news, it turns out that Countrywide kept its mortgage fraud racket alive by silencing whistleblowers. Like I said, not surprising. What is (a little) surprising is that this “legacy of corruption” still goes on at Bank of America, which bought Countrywide after it collapsed.
The pair of articles by mortgage industry watchdog and investigative journalist, Michael Hudson, exposes the past and present fraud in the Countrywide-Bank of America mega lender.
For years, cell phone providers have allowed third parties to add charges to your phone bill, even if you don’t ask for the “service” provided by the third party. And while some allow users to stop cramming—also called preacquired account marketing—by blocking third-party billing, consumers have had mixed results trying. Others never notice, because the charges are usually for small amounts, and are often hard to find on the bill.
Most consumer law and regulations are—basically—an attempt to level the playing field between those with knowledge and power and those without knowledge, or power, or both.
I mean corporations and consumers, of course. The general idea is that since consumers are generally clueless about things like amortization, APR, and most financial jibber jabber, they can still make intelligent decisions as long as corporations make disclosures that consumers can understand.
The dirty little secret, however, is that nobody reads disclosures, not even distinguished, well-respected federal appellate judges like Frank Easterbrook and Richard Posner. And really, how many contracts have you ever read?
So if the foundation of the common law of fraud, along with the foundation of the U.S. consumer regulatory scheme, is that disclosing stuff about cars, loans, credit cards, houses, etc., render the marketplace fair, then our system of consumer justice is just an exercise in self-deception, isn’t it?
The subprime mortgage meltdown, it turns out, makes for riveting reading. I was up until 4 a.m. reading The Monster, a page-turning account of the subprime lending binge that precipitated the collapse of the world economy.
The Monster would make a great heist movie, except that, instead of stealing piles of money from a casino, the subprime lending industry, lead by Ameriquest, Lehman Brothers, and countless others, scammed millions of Americans out of their savings.
While judges were looking the other way, a new fad was apparently sweeping the mortgage lending industry: robo-signers. A robo-signer is a person whose job is to put their signature on an affidavit, regardless whether they know what they are signing or whether it is true.
First GMAC/Ally Bank “discovered” that their representatives were signing affidavits without checking their facts. It stopped its foreclosures, as a result (probably a wise move when perpetrating a fraud on the courts). Now, it looks like Chase bank has the same robo-signer problem. In fact, this is a problem in many areas of law where lawyers try to turn the courts into a rubber stamp or assembly line.
That this is happening is no surprise to anyone with any knowledge of the debt collection industry. The interesting question, though, is this: will the scandal spread to other industries where robo-signing is common?
From the Federal Trade Commission:
If you’re looking for a job, you may see ads for firms that promise results. Many of these firms may be legitimate and helpful, but others may misrepresent their services, promote out-dated or fictitious job offerings, or charge high fees in advance for services that may not lead to a job.
Job-Hunting/Job Scams | FTC
Whether or not you have been burned by your cell-phone provider’s shady business relationships, a little preventative maintenance of your account is in order. What I call a scam, they call “third-party billing.”
But you can stop it.
One Consumerist commenter was successful in asking T-Mobile to block third-party billing. Two minutes later, so was I, and the customer service representative I spoke with did not give me any grief. Just call 611, ask for an operator, and tell them you want them to block third-party billing.
This should work with other cell phone service providers, as well.