The homebuyers concede in the bank RICO class action lawsuit that when mortgage borrowers go into default, it is natural for lenders to act to protect their interest in the property.
“However, lenders are not permitted to mark up the fees for such services to earn a profit,” the class action lawsuit states. “Nor are lenders permitted to assess borrowers’ accounts for defaulted-related service fees that are unreasonable and unnecessary. Nevertheless … using false pretenses to conceal the truth from borrowers, that is precisely what Defendants do.”
The homebuyers allege in the bank RICO class action lawsuit that Wells Fargo and Chase use an automated mortgage loan management system, and subsidiaries, to “fraudulently conceal their unlawful assessment of improperly marked-up or unnecessary fees for default-related services, cheating borrowers who can least afford it.”
This allows them to mark up the fees charged by vendors by 100 percent or more, and then, “without disclosing the mark-up, assess borrowers’ accounts for the hidden profits.”
This alleged scheme has allowed the banks to profit at the expense of struggling consumers. Wells Fargo, for example, saw a 20 percent increase in profits in the fourth quarter of 2011 alone, the class action lawsuit says.
“Defendants are aware that it is improper to mark up the fees assessed on borrowers’ accounts for default-related services. Therefore, defendants fraudulently conceal these fees on borrowers’ accounts, omitting any information about defendants’ additional profits, by identifying them on mortgage statements only as ‘other charges,’ ‘other fees,’ ‘miscellaneous fees,’ or ‘corporate advances,’” the bank RICO class action lawsuit states.
The Wells Fargo and Chase RICO class action lawsuit is brought on behalf of all U.S. residents who had a loan serviced by Wells Fargo or Chase and whose accounts were assessed fees for default-related services, including Broker’s Price Opinions, and inspection fees, at any time, continuing through the date of final disposition of this action.
The class action lawsuit is seeking declaratory and injunctive relief, restitution and disgorgement, and compensatory and treble damages for unfair competition, unjust enrichment and RICO conspiracy.
A copy of the Wells Fargo and Chase RICO Class Action Lawsuit can be read here.
Angry homebuyers have filed a federal RICO class action lawsuit against Wells Fargo and JPMorgan Chase accusing the banks of illegally charging inflated fees and interest rates to homebuyers who go into default. 
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UPDATE: On Oct. 31, 2016, Wells Fargo agreed to pay $50 million to settle a class action lawsuit claiming they imposed excessive and abusive fees on borrowers who were late on their mortgage payments.
Please add me to this lawsuit.