Oct 28, 2009
3rd Circuit Revives Class Action Against Countrywide Over Alleged Kickback Scheme
In a huge setback for Countrywide Financial Corp., the 3rd Circuit has revived a national class action brought by homebuyers who accused the lender of a kickback scheme in which buyers were required to purchase mortgage insurance from one of a handful of companies that in turn took out reinsurance policies from one of Countrywide’s wholly owned subsidiaries. A lower court had dismissed the case, finding the buyers could never show they had been “overcharged” and had no right to sue under RESPA’s anti-kickback provisions.