Olympia – The Washington State Department of Financial Institutions (DFI) is pleased to announce a settlement has been reached in a consumer protection case regarding Countrywide Home Loans (CHL) that has been ongoing for more than two years.
On June 23, 2008, DFI filed a Statement of Charges against Countrywide Home Loans alleging the company was discriminating against ethnic and racially protected classes by offering loan products that were less favorable than those offered to non-protected classes.
On July 1, 2008, Bank of America purchased Countrywide Home Loans. As a result, CHL became a subsidiary of the national bank and DFI lost jurisdiction over any loans made after that time.
The Department conducted more than 2,400 hours of examination and investigation to determine the extent of the problem. DFI examiners evaluated more than 30,000 loans, and discovered more than 100 alleged victims of predatory pricing based upon comparisons with statistically significant control group members.
Besides the complex nature of DFI’s allegations, the case was complicated with numerous changes in the Washington State Consumer Loan Act over the period of time our allegations covered.
In the settlement, DFI identified 123 victims of alleged discriminatory pricing. Each of these Washington residents will receive a settlement ranging from $997 to $26,176. The amount received depends upon the type of loan, the number of predatory features in the loan and whether or not the consumer was foreclosed upon. The full $650,000 settlement is being dispersed to the affected consumers. DFI is not retaining any of the settlement.
“It’s important to recognize the tenacious efforts of DFI’s examination, investigation and legal teams,” DFI Director Scott Jarvis said. “While Countrywide disagreed strenuously with DFI’s allegations, DFI’s staff steadfastly pursued restitution for consumers - and now, nearly two years later, the case is finally settled.”