June 21, 2012

Assembly Approves Landmark Foreclosure Fraud Prevention Act of 2012

Assembly Speaker Sheldon Silver and Judiciary Committee Chair Helene Weinstein today announced the passage of the Foreclosure Fraud Prevention Act of 2012. This historic measure would protect New York's working families from fraudulent business practices perpetrated during the foreclosure process, by instituting misdemeanor and felony-level penalties for those who intentionally engage in or tolerate such conduct.

"Throughout the state, many working families have invested their hard work and their hard earned money in their homes," said Silver. "Hardworking families, who have been victims of the recession, should not be taken advantage of by banks or lenders. Through the approval of this important bill, we will begin to restore many of our neighborhoods, which have been devastated by the mortgage foreclosure crisis and we will ensure that families can remain in their communities."

The bill (A.10629-A/Weinstein) makes it a class A misdemeanor for an employee or agent of a residential mortgage business to knowingly authorize, prepare, execute or offer to file false documents in a residential foreclosure action. The bill also makes it a class E felony for employees who engage in, or employers who tolerate, multiple acts of foreclosure fraud.

"With this new law, we will hold criminals accountable for their abusive foreclosure practices and deter them from unlawfully removing New Yorkers from their homes," said Weinstein. "This measure puts in place new criminal sanctions against lenders and their agents who intentionally submit fraudulent documents in foreclosure actions. It sends a clear message: going forward, fraud will no longer be tolerated in foreclosure actions in New York."

Silver added, "I applaud the efforts of Attorney General Eric Schneiderman for taking the lead on this and many other initiatives to combat the growing mortgage foreclosure crisis in New York. I commend my Assembly colleagues for supporting this legislation and in particular, Assemblywoman Helene Weinstein, for her leadership in fighting for justice for homeowners."