Posted: January 28, 2013
By: Juan Carlos Rodriguez
Practice Areas: Consumer Protection, Insurance & Financial Products & Services
Law360, New York (January 28, 2013, 1:32 PM ET) -- Goldman Sachs
Group Inc., Litton Loan Servicing LP and Ocwen Financial Corp. were
hit Wednesday with a proposed class action alleging they schemed to
require mortgage customers to buy force-placed insurance and took
kickbacks from insurers.
Jimmy and Jacqueline Lyons say the defendants derived improper
financial benefits by imposing force-placed insurance policies on
consumers' properties, some of which were already covered by
homeowners insurance policies.
The companies also improperly charged residential borrowers for
the cost of procuring the insurance from insurance agents, but some
of that cost was returned, transferred or paid to Litton and its
related entities, the complaint says.
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