Bank of New York Mellon, Bank of America class action alleges company discriminates against Hawaiian, Miamian homeowners

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Bank of New York Mellon, Bank of America class action:

• Who: Bank of America and Bank of New York Mellon have been hit with a class action lawsuit by home loan holders.
• Why: The plaintiffs allege the pair ran a scheme to illegally foreclose on customers with false documentation.
• Where: The lawsuit was filed in Hawaii federal court.

Bank of America and Bank of New York Mellon have been hit with a class action lawsuit alleging the pair engaged in foreclosure schemes by inducing Hawaii and Miami-based homeowners to enter into predatory loans with third-party Countrywide. 

The plaintiffs, mostly Hawaii and Miami homeowners of color, filed the class action lawsuit against Bank of America National Association (BANA) and the Bank of New York Mellon (BONYM) July 19 in a Hawaii federal court. 

The plaintiffs allege that the banks exercised a scheme where they fraudulently foreclosed on home loan customers, predominantly people of color, using forged mortgage note rubber-stamped endorsements, false mortgage note assignments and false affidavits. 

“Defendants BANA and BONYM devised a scheme or artifice to defraud that involves the use of many sub-schemes for the purpose of filing and prosecuting thousands of unlawful foreclosures complaints in Hawaii and nationally,” the Bank of New York Mellon and Bank of America class action states. 

Bank of New York Mellon, Bank of America class action alleges forged mortgage notes

Plaintiff Nathan Earl Aiwohi claims Bank of New York Mellon sold him a 120-month, interest-only, “predatory” Countrywide loan in 2006, requiring him to pay $438,750 over 10 years before amortized principal and interest payments kicked in for the following 240 months. 

The lawsuit states that he is now amid a wrongful foreclosure action Bank of New York Mellon filed that has been ongoing since 2013.

Aiwohi, like most of the plaintiffs in the case, says he is being prosecuted in foreclosure by Bank of New York Mellon using a forged Countrywide mortgage note rubber-stamped endorsement that is undated. He also says the bank used a false and fraudulent Mortgage Electronic Registration Systems, Inc. (MERS) mortgage note assignment and made sworn affidavits containing false statements of fact.

“Class Plaintiffs allege that all of their Countrywide mortgage notes contain robo-signed, undated, forged blank note endorsements,” the Bank of New York Mellon and Bank of America class action alleges.

They also say that Bank of America records mortgage assignments for Countrywide originated loans in public records that falsely claim MERS sold the mortgage, together with the mortgage note, to the foreclosing plaintiff when MERS never owned or possessed the note.

Seven out of eight plaintiffs in the case claim they have underlying fraudulent MERS note assignments filed in their foreclosure cases. 

“Class Plaintiffs allege these MERS note assignments are a sham and that hundreds of thousands, if not millions, of such false MERS note assignments have been filed by Defendants in public land conveyance records nationally for which Class Plaintiffs also seek equitable and injunctive relief from this Court,”: the lawsuit states.

The plaintiffs are suing for violations of the Racketeer Influenced and Corrupt Organizations Act (RICO) and the Fair Housing Act, and seeking damages, an injunction, fees, costs and a jury trial. 

Earlier this year, Bank of America was hit with a class action lawsuit alleging it went back on its promise to refund overdraft fees to customers who faced financial hardship during the COVID-19 pandemic.

In June, consumers filed another class action, alleging Bank of America does not notify account holders it does not protect them from fraud through payment platforms like Zelle and Venmo. 

What do you think about the allegations in the Bank of New York Mellon and Bank of America class action? Let us know in the comments! 

The plaintiffs are represented by Bruce Jacobs of Jacobs Legal, PLLC and Frederick J. Arensmeyer of the Law Office of Frederick J. Arensmeyer, LLC. 

The Bank of New York Mellon, Bank of America class action is Nathan Earl Aiwohi et al., v. Bank of America, N.A., et al., Case No. 1:22-cv-00312-JAO-RT, in the U.S. District Court for the District of Hawaii.

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