4.In particular, Citi utilized a computer system to automatically assess feesfor late payments, delinquency, finance charges, penalties, refinancing penalties,recording fees, inspection fees and other charges without regard to the terms of theborrowers’ loans or the relevant circumstances. Instead of being placed on reasonableparameters, the computer system is programmed to assess as many charges as possibleand to pay first all outstanding fees and costs before satisfying interest and principal. Bykeeping the mortgage payments in suspension accounts and failing to reflect receipt ofthe payments towards the homeowners’ accounts, Citi amplified its fraudulent scheme of
charging excessive fees and costs.
Citi concealed the nature of the fees being assessed on the monthlystatements mailed to Plaintiff and Class Members by describing them simply as "other"charges or fees. In this manner, Citi victimized and further increased the indebtedness ofpersons who were already in danger of losing their homes to foreclosure. Citi’ s schemehas been ongoing for years and was in existence when Plaintiff and Class Membersobtained their mortgage. This practice of charging illegal fees was particularlyexasperated in the recent mortgage foreclosure crisis of 2007.
During the recent foreclosure crisis, between October 2008 and January2009, Citi made a plea for survival and received
billion in funds from the UnitedStates Government as part of the Troubled Asset Relief Program ("TARP"), funded bythe taxpayers. By accepting these payments, Citi agreed to comply with HomeAffordable Modification Program ("HAMP") - a program under which Citi and othermajor mortgage services and lenders receive incentive payments for providing mortgageloan modifications and other foreclosure prevention services to eligible borrowers such asPlaintiffs and the putative class members.
Case 4:11-cv-00443-RP -CFB Document 1 Filed 09/23/11 Page 3 of 82