A settlement has been reached in a whistleblower class action lawsuit brought against six large banks who are accused of charging military veterans with hidden fees on home refinancing loans.
The out-of-court settlement, reached November 19 in federal court, allows for a fund of $161.7 million to be paid by the six banks to the class. The banks are Countrywide Home Loans Inc., PNC Bank, First Tennessee Bank, SunTrust Mortgage Inc., CitiMortgage and JPMorgan Chase Bank.
The class action lawsuit also names Wells Fargo & Co. and Mortgage Investors Corp as defendants, and they will proceed to court as the judge rejected their motion to dismiss.
Filed in 2006, the lawsuit alleges the banks cheated the veterans and American taxpayers out of millions of dollars by hiding illegal fees in home mortgage refinancing transactions and seeking to collect on federal loan guarantees when loans went into default.
