Monday, October 06, 2008

Countrywide Scores Win As Miami Bankruptcy Judge Rules Against U.S. Trustee; Says Only Prosecutors Can Bring Action For Lenders' Alleged Bad Acts

In Miami, Florida, The Wall Street Journal reports:
  • Countrywide Home Loans Inc. scored a victory against a U.S. government agency that sued it in three states claiming that it engaged in "bad faith conduct" that has hurt debtors in bankruptcy. In dismissing one of the lawsuits Wednesday, A. Jay Cristol, a bankruptcy judge in Miami, said the government agency, the U.S. Trustee Program, couldn't seek sanctions against the mortgage lender in bankruptcy court.


  • In the case Judge Cristol dismissed Wednesday, the agency said Countrywide wrongly tried to foreclose on a debtor's home. The suit called for monetary sanctions, but Judge Cristol found that only federal prosecutors, not the U.S. Trustee, can bring legal action to punish bankruptcy-law violators.

For more, see Countrywide Scores Legal Win (subscription may be required; if no subscription, go here, then click link for story).

Go here, Go here and Go here for more on other Countrywide lawsuits & other problems. CountrywideProblemsZeta