JP Morgan faces lawsuits over mortgage foreclosure

JPMORGAN Chase faces two possible class action lawsuits, including fraud, related to its decision to halt foreclosures, the US bank said in a regulatory filing yesterday.

The suits allege “common law fraud and misrepresentation, as well as violations of state consumer fraud statutes,” JPMorgan said, adding to the chorus of major banks facing legal action after underwriting and securitising mortgages.

In September, JPMorgan temporarily halted home seizures after finding glitches in foreclosure documents. Last week, it said it planned to start refiling the foreclosure documents within weeks.

The lawsuits were filed against Washington Mutual Bank and JPMorgan Chase & Co in the United States District Court for the Northern District of Illinois, and against Chase Home Finance in California state court, the 10-Q filing said.

JPMorgan also acknowledged it faced suits related to mortgage-backed securities, brought by hedge fund Cambridge Place Investment Management and brokerage Charles Schwab. Bank of America and Citigroup last week disclosed suits related to mortgage underwriting.