Illinois's Madigan Demands JPMorgan Mortgage Meeting Over Foreclosures

Illinois Attorney General Lisa Madigan, questioning whether JPMorgan Chase & Co. is violating state consumer protection laws as it pursues residential foreclosures, demanded a meeting with the lender.

JPMorgan Chase, the third-largest U.S. mortgage servicer, said yesterday it was asking courts to delay judgments in pending cases while it examines supporting papers. The New York- based bank said its internal review covers 56,000 loans from 23 states.

“With JPMorgan now acknowledging possible abuses in preparing loan documents, the impact on homeowners in our state and across the country could be great,” Madigan said today in a statement.

Attorneys general in at least five states are investigating borrowers’ claims that some of the nation’s largest home lenders and loan servicers are making misstatements in foreclosures.

Ally Financial Inc. said last week that it found a “technical” deficiency at its GMAC Mortgage unit that allowed employees to sign foreclosure documents without a notary present or with information they didn’t personally know was true.

“We have requested that the courts not enter judgments in pending matters until we complete our review,” Thomas Kelly, a JPMorgan spokesman, said yesterday in an interview. The review is expected to be finished in “a few weeks,” he said.

Madigan said she wanted information on the effect that the potential inaccuracies could have on Illinois homeowners and how many are affected by the bank’s stay.

Kelly declined to comment today on Madigan’s demand for a meeting.

The attorney general said she demanded a similar meeting with Detroit-based Ally Financial.

To contact the reporter on this story: Andrew M. Harris in Chicago at aharris16@bloomberg.net.

To contact the editor responsible for this story: David E. Rovella at drovella@bloomberg.net.

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