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Published in Stocks and Investing on Thursday, January 22nd 2009 at 12:58 GMT, Last Modified on 2009-01-22 12:59:45 by Market Wire
SEATTLE--([ BUSINESS WIRE ])--Hagens Berman, a nationally recognized consumer-rights law firm, is investigating Bank of America (NYSE:BAC) and home appraisal company Lender Processing Services (NYSE:LPS), based on homeowner reports that the two companies conspired to overcharge homeowners for appraisals in perhaps hundreds of thousands of transactions.
According to reports, Bank of America (BOA) charges homeowners upwards of $400 for routine home-purchase appraisals, but through an alleged deal with a large appraisal management company, pays much less – often less than $150 -- pocketing the difference.
"Every bank has an obligation to home purchasers to disclose the true cost of its services including interest rates, finance charges and other fees," said Steve Berman, managing partner of Hagens Berman Sobol Shapiro. "We believe this obligation extends to what we think is a huge, currently undisclosed mark-up on appraisals."
Through the firm's work in other litigation on behalf of homeowners, Hagens Berman learned of BOA's relationship with LPS, a company known as an appraisal management company (AMC), which groups hire to use market pressure to drive down the cost of appraisals, often at the expense of independent appraisers.
According to reports, AMCs then purportedly strike deals with organizations like Bank of America allowing the banking giant to profit on the difference without disclosing the deal to home purchasers.
"Had Bank of America disclosed to homeowners that it made a 150 percent profit, I don't think homeowners would stand for it," Berman said.
According to Berman, if the allegations prove true, BOA can make as much as $200 per transaction, which totals hundreds of millions of dollars.
Bank of America is the nation's largest bank, with more than $2.7 trillion in assets.
Hagens Berman is interested in talking with anyone who purchased or refinanced their home through Bank of America. You can contact attorneys at [ bac@hbsslaw.com ].
You can learn more about this investigation at [ www.hbsslaw.com/BOAappraisals ].
About Hagens Berman Sobol Shapiro
Hagens Berman Sobol Shapiro is based in Seattle with offices in Chicago, Boston, Los Angeles, Phoenix, San Francisco and New York. Since the firm's founding in 1993, it has developed a nationally recognized practice in class action and complex litigation. Among recent successes, HBSS has negotiated a pending $300 million settlement as lead counsel in the DRAM memory antitrust litigation; a $340 million recovery on behalf of Enron employees which is awaiting distribution; a $150 million settlement involving charges of illegally inflated charges for the drug Lupron, and served as co-counsel on the Visa/Mastercard litigation which resulted in a $3 billion settlement, the largest anti-trust settlement to date. HBSS also served as counsel in a $850 million settlement in the Washington Public Power Supply litigation and represented Washington and 12 other states in lawsuits against the tobacco industry that resulted in the largest settlement in the history of litigation. For a complete listing of HBSS cases, visit [ www.hbsslaw.com ].
