Illegal debt sales and debt collection practices have landed Citibank in hot water with federal regulators. In two separate actions, regulators ordered the bank to fork over $16 million in consumer relief, pay $3 million to the government in penalties and forego $34 million in collections from approximately 7,000 customers.business man

The Consumer Financial Protection Bureau finalized two actions against Citibank – one involving sales of credit card debt with inflated interest rates and not timely forwarding consumer payments to debt buyers. The second involved both the bank and two of the debt collection law firms that together reportedly falsified court records in debt collection lawsuits. For the first action, the bank is ordered to pay $5 million in consumer relief, as well as a $3 million federal penalty. For the latter, it is ordered to refund $11 million to customers and stop its pending debt collection actions against involved consumers.

CFPB’s director said the bank gave its consumers bad information when it sold their credit card debt, and then relied on shady law firms to change up court records to appear in the bank’s favor.  Continue reading

We are now slightly more than a month in to the Trump presidency, and Democrats are already gearing up for the next election, setting their sights on the next mid-term. However, if they want to prevail, they are first going to have to acknowledge and accept that the Obama administration did not oversee a golden era of financial and economic policies – no matter what kind of challenges he inherited.miami

The reality is Obama had many opportunities to help those in the working class, and he repeatedly declined to seize them.

The two main areas to which we refer:

  • Obama’s handling of the foreclosure crisis/ subsequent bank bailouts. The end result of the policies adhered to on these fronts resulted in concentrated financial power, rather than support of the American middle class.
  • Enactment of pro-monopoly policies. This approach crushed rural area economies, so it was unsurprising many of those voters – even those who had previously voted for Obama – swung to the side of Donald Trump.

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Esteemed Miami foreclosure lawyer Bruce Jacobs has been given the go-ahead to proceed with his lawsuit that aims to oust the new Florida Democratic Party Chairman Stephen Bittel. american flag

The lawsuit recently survived a motion to dismiss after Miami-Dade Circuit Judge Lisa Walsh ruled the complaint should be allowed to proceed. Walsh declined, however, too prevent the Democratic party from certifying the election of Bittel, as they had already done so.

Jacobs filed the lawsuit last month, along with Dr. Mae Christian, a civil rights advocate and president of Miami-Dade County’s Democratic Black Caucus. The lawsuit names as defendants Bittel, the Florida Democratic Party and the Miami-Dade Executive Committee chairman, Juan Cuba.  Continue reading

It’s been more than eight years now since the economic crash of 2008. Now, the big mortgage lenders – the same entities that played a huge role in that crisis, the same companies that received sizable bailouts under the Emergency Economic Stabilization Act – are getting into the rental industry. It may surprise no one to learn these companies are awful landlords. In fact, as a new report by Bloomberg News shows, the companies are driving up the cost of that rent with the goal of evicting people from those homes.house

The Bloomberg report looks closely at a company called HavenBrook Homes, which is controlled by one of the largest money managers on the planet, Pacific Investment Management Co. Bloomberg noted that a study by the Atlanta Federal Reserve showed that in a single county in Georgia, this and other large institutional investors were twice as likely to file for eviction against renters as owners of smaller operations.

Essentially, these big investment, private equity and hedge funds that snapped up a huge portion of the properties left vacant across the country after the 2008 foreclosure crisis have been turning these sites into occupied rentals. They have altered the landscape of an industry that was historically dominated by mom-and-pop owners. With the sole goal of maximizing profits, the conversations about collections that used to take place on the front stoop between landlord and owner are now being funneled into international call centers. Good luck catching a break there. Continue reading

College debt is weighing heavily on tens of thousands of elderly Americans, pushing them into poverty. That’s according to a new report by the Government Accountability Office, which revealed more than 110,000 people over the age of 65 had their Social Security checks garnished in 2015 in order to continue paying off student loans on which they had defaulted. coinerolls

The report further indicates more than 70,000 Americans over the age of 50 are currently living under the poverty line specifically because their Social Security payments are being slashed in order to cover the amount they still owe on student loans.

These figures contrast the widely-held notion that student loan debt is largely a problem for millennials. But what this report, which was generated at the request of Senators Claire McCaskill (D-Mo.) and Elizabeth Warren (D-Mass.), reveals this is an inter-generational problem. Further, it’s not one that is simply going to “sort itself out.” That’s because of those tens of thousands of borrowers whose Social Security checks are being cut to pay down this debt, they aren’t actually paying it down. Nearly 70 percent of those borrowers are only paying on the fees and interest. That means the overall amount of their debt isn’t decreasing, which means unless they start generating more money with another income source, they aren’t ever going to stop making payments. And guess who profits from all this? The federal government.  Continue reading

There are a number of commendable accomplishments by President Barack Obama during his eight years in office. These were recently detailed in long-form story called, “My President Was Black,” by Ta-Nehisi Coates of The Atlantic. However, this profile of Obama is incomplete in one regard: It does not take into account his failure to stop the foreclosure crisis – or to hold anyone accountable for the enormous damage it inflicted on so many ordinary Americans. whitehouse

In fact, more than 9 million American families have lost their homes since the housing bubble burst, either due to foreclosure or some associated transaction. When we look at this in terms of the average size of American households, we’re talking about 20 million displaced people. These were individuals forced to uproot their lives. Forced to find a place to stay. Forced to start over. This had an out-sized impact on people of color in particular, who are more likely to keep their wealth in their home equity and who were also the primary targets of predatory subprime loans. Although Coates takes note of the fact that white homes hold seven times as much wealth as black households, yet fails to mention that this statistic actually worsened under Obama, in large part due to these foreclosures, according to The Federal Reserve.

This is not to say that Obama did not have noteworthy achievements. However, this has to be counter-balanced with Obama’s own role in one of the biggest losses of black wealth in history.  Continue reading

The Florida Democratic party is hanging in the balance, and now, the typical lowly race for Miami-Dade County’s Democratic Party committeeman has gone national, just ahead of a special election that will likely determine the fate of the party in Florida. Our own Bruce Jacobs, Miami foreclosure attorney, is at the forefront, seeking to rapidly fill the precinct chairs for the party is that those individuals can create a groundswell of support for Dwight Bullard, who is up against wealthy Miami real estate businessman Stephen Bittel, who also happens to be a major party donor. flag

Bullard is backed by Our Revolution, a political organization created by one-time Hillary Clinton rival Bernie Sanders. Bittel, meanwhile, was a staunch supporter of Clinton. He now has the backing of U.S. Rep. Keith Ellison of Minnesota, who at this point is the front-runner to lead the Democratic National Committee. Ellison’s support came as something of a surprise because he was a long-time, prominent Sanders supporter and also previously had the support of Our Revolution.

Jacobs served Our Revolution Miami as a Bernie Sanders delegate, and participated in the Democratic National Convention in Philadelphia in that role. Jacobs now says he is hoping to drum up enough support among local Democrats to get involved as Precinct captains by the Dec. 15th deadline. The goal from there is to keep those individuals involved in politics, and further provide a strong movement within numerous local and state offices. Precinct captains are the only ones who can vote during leadership meetings, which is why filling these posts is so essential.  Continue reading

In the wake of Wells Fargo’s most recent scandal, in which the financial firm was caught red-handed creating two million fraudulent accounts by customers, the bank promised it would clean up its act. It promised to change its practices and do its best to protect its customers. But as a New York Times‘ investigation shows, the bank has been – and still is – actively trying to kill off lawsuits stemming from its fraud by forcing customers affected to settle their claims via arbitration, rather than be allowed to have their day in court. So much for accountability. credit cards

Highlighting these actions are critical now that we have leaders intent on gutting the Consumer Financial Protection Bureau and its regulations – proposed and existing.

We should start by explaining first what forced arbitration is. It is part of a binding contract that bank consumers “agree” to by virtue of having an account, and it requires that all disputes arising with the firm must be handled with a private arbitrator, rather than in a court of law with a judge or jury. There is very good reason banks (and many other businesses) push so hard for these provisions, and its that the outcomes are most often favorable to defendants. Even where decisions are made in favor of consumers, they tend to be for far less than what they might have received in litigation. What’s more, the process is not transparent. It’s all confidential, so it does nothing to help others similarly situated. It effectively quashes the ability of wronged consumers to engage in a class action, which is sometimes the only way to truly hold these large firms accountable.  Continue reading

The Miami foreclosure defense lawyers at Jacobs Keeley have not been shy with criticism of the current presidential administration, in particular with regards to a failure to hold big banks and executives accountable for their central role in the foreclosure crisis. Unfortunately, it does not seem as if the new administration is going to take any more of a hard line on this kind of issue, despite repeated promises to “drain the swamp.” whitehouse

One must look no further than the recent appointment of Steve Mnuchin, Wall Street financier, to the cabinet as Secretary of Treasury. Mnuchin is a career banker. He spent 17 years at Goldman Sachs, ultimately attaining the position of partner. He oversaw a privately-owned hedge fund and later was a top fundraiser for Republican president-elect Donald Trump. He also worked for a time at a California bank that NPR recently referred to as a “foreclosure machine” in the midst of the housing bust.

Essentially, Mnuchin and others were searching for ways to turn a profit from the ruins of the housing market. He and a group of other billionaire investors purchased IndyMac, a bank that took a nosedive after its risky mortgage loans turned sour. He and the others bought it with a promise to pay future losses above a certain threshold – which they did, and after six years, sold it as OneWest at a $1.5 billion profit for $3.4 billion. How did they do this? On the backs of suffering homeowners.  Continue reading

Massachusetts Senator Elizabeth Warren, in an open letter to U.S. president-elect Donald J. Trump, takes aim at the new administration’s transition team, packed with corporate insiders and lobbyists. pen

In her letter, Warren said if Trump intends to keep his promise to voters to “drain the swamp” and rid it of “powerful special interests” that “rigged” the political and economic systems against the average American, he needs to start by reevaluating his own transition team. Although Trump promised he would not be a puppet to lobbyists or special interests or donors – something that struck a cord with many voters – he has since elevated to his team a number of industry insiders, special interest lobbyists, wealthy investors and Wall Street bankers. Several more are reported to be on the short list of possible cabinet members.

For example, the reported top recommendation for treasury secretary is a hedge fund manager and partner at Goldman Sachs, who once worked for George Soros. The proposed commerce secretary is a billionaire private equity executive who owned a coal mine with hundreds of safety violations before an explosion killed a dozen miners. He’s also a top member of a Wall Street fraternity that, according to New York Magazine, finds entertainment in singing drunken show tunes that mock poor people. These are exactly the kind of people Trump vowed he was running against. Continue reading