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Citigroup, MidFirst Bank Lose Bid to Dismiss Force-Placed Lawsuit

Posted: January 4, 2013
By: Brian Browdie
Source: American Banker
Practice Areas: Consumer Protection, Insurance & Financial Products & Services

A lawsuit that accuses both Citigroup (NYSE: C) and MidFirst Bank of Oklahoma City of forcing homeowners to purchase flood insurance in excess of amounts required by law may advance, a federal judge in Utica, N.Y., has ruled.

The banks must face allegations by Gordon Casey, a borrower in Syracuse, N.Y., and Duane Skinner, a borrower in Maryland, of wrongdoing in the force-placing of flood insurance on their homes, U.S. District Judge David Hurd held Wednesday.


Shanon Carson, a lawyer for the plaintiffs, said in a news release that the banks had engaged "in a classic bait-and-switch, in which borrowers are informed of one set of flood insurance requirements at closing and then, later, the banks demand additional, unwanted flood insurance coverage."


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