Berger & Montague, P.C. and Nichols Kaster, PLLP Announce Final Approval of Nationwide Class Action Settlement with Citibank, N.A, Assurant, Inc., American Security Insurance Company, and Standard Guaranty Insurance Company
Aug 25 14
Judge David Hurd of the United States District Court for the Northern District of New York has granted final approval of a nationwide class action settlement in a pair of consolidated federal cases, Casey v. Citigroup Inc., No. 12-cv-820 (N.D.N.Y.) and Coonan v. Citibank, N.A., No. 13-cv-353 (N.D.N.Y.), involving force-placed insurance. The law firms appointed to represent the plaintiffs and the classes, Berger & Montague, P.C. and Nichols Kaster, PLLP, are pleased that the court approved all aspects of the settlement, which makes force-placed insurance refunds available to over 400,000 borrowers. Specifically, Citibank and the other defendants have made more than $115 million in refunds and escrow credits available to borrowers whose mortgage loans were serviced by Citibank, and who submit a claim form to receive a refund of the force-placed insurance premiums that were charged to them. The lawsuits alleged that Citibank and its force-placed insurance vendors, Assurant Inc., American Security Insurance Company, and Standard Guaranty Insurance Company, unlawfully profited from force-placing insurance on borrowers' properties, including by arranging for improper kickbacks or so-called 'commissions' to be paid to Citibank or its affiliates by the force-placed insurance vendors. The Casey lawsuit also alleged that Citibank increased the amount of force-placed flood insurance required for some borrowers in excess of their unpaid principal balance, in violation of borrowers' loan agreements. To receive compensation under the settlement, mortgage borrowers whose loans have been serviced by Citibank and who were subjected to force-placed insurance must submit a claim form by the end of the claim period, which remains open. Class members who submit timely and valid claims will receive a check or escrow credit equal to 12.5% of any hazard insurance premiums they were charged between January 1, 2007 and April 2, 2014; 8% of any wind insurance premiums they were charged between January 1, 2007 and April 2, 2014; and 8% of any flood insurance premiums they were charged between May 17, 2006 and April 2, 2014.