Connecticut AG Jumps Into Dubious Documents Fray; Demands Immediate Freeze On All Ally/GMAC Foreclosures In State

The Wall Street Journal reports:

• Connecticut Attorney General Richard Blumenthal is probing GMAC Mortgage, one of the nation's largest servicers of home loans, over what he claims are "defective foreclosure documents" filed in Connecticut. Mr. Blumenthal is demanding that GMAC Mortgage, a unit of Ally Financial Inc., freeze all foreclosures in the state. Ally Financial is majority-owned by the U.S. government.

• "The bank's apparent failure to follow basic legal procedure—a potential fraud on the court—is appalling and unacceptable," Mr. Blumenthal said. "Our investigation will enable strong legal action against GMAC/Ally, if warranted by the facts and the law. I will fight to assure the banks comply with clear legal requirements that protect homeowners from unfair foreclosures of their homes."(1)

For more, see Connecticut Attorney General Probes GMAC Mortgage (WSJ subscribers only; if no subscription, GO HERE - then click appropriate link for the story).

For the Connecticut AG press release, see Attorney General Investigating Defective GMAC/Ally Foreclosure Docs, Demands Halt To Its CT Foreclosures.

(1) According to his press release, Blumenthal has given GMAC/Ally an October 15 deadline to provide the following information:

• Provide case names and docket numbers of all Connecticut foreclosure cases in which defective affidavits were filed;

• Explain when and how it will inform defendants and the Connecticut Superior Court regarding the defective affidavits and documents, and whether it will withdraw the defective affidavits;

• Identify employees or contractors who reviewed and signed Connecticut foreclosure-related documents and describe their relationship to the bank;

• Outline steps to ensure the integrity of future affidavits and other documents submitted to the Connecticut Superior Court.