Kirby McInerney LLP Files Class Action Lawsuit Against Homeward Residential Holdings Inc., QBE Insurance Corporation and WL Ross & Co. Alleging a Scheme to Recoup Overstated Reimbursements for Force-Placed Insurance from Borrowers

Business Wire

NEW YORK--(BUSINESS WIRE)-- The law firm of Kirby McInerney LLP announced today that it has filed a putative class action lawsuit against the loan servicing firm Homeward Residential Holdings Inc., the insurer QBE Insurance Corporation, the private equity firm WL Ross & Co., and certain of their affiliates in connection with an allegedly unlawful scheme to recoup overstated reimbursements for force-placed insurance from borrowers under their mortgages. Prior to 2012, Homeward was known as American Home Mortgage Servicing, Inc. or AHMSI.

Mortgages require borrowers to maintain homeowners insurance to protect the lender’s interest in the property. If a borrower’s homeowners insurance lapses, the lender is entitled to purchase force-placed insurance and be indemnified by the borrower for the expense of the premium.

The lawsuit alleges that QBE Insurance and its affiliates gave Homeward secret premium rebates, but that borrowers were nevertheless fraudulently charged based on the full premiums, i.e., materially in excess of Homeward’s true costs. The lawsuit alleges that the defendants concealed the rebates by laundering them through multiple sham and collusive transactions. Those transactions allegedly included: (i) $10 million paid to Homeward as purported compensation under a bogus “marketing services agreement;” (ii) the issuance of securities worth $85 million to Homeward’s shareholders -- WL Ross and its affiliates; (iii) more than $16 million in phony “insurance commissions” paid to Homeward; and (iv) at least $25 million in below-cost, outsourced services provided to Homeward through an affiliate of QBE Insurance.

The action, Parker et al. v. AHMSI Insurance Agency, Case 1:15-cv-23840-JEM (S.D. Fla.), is brought on behalf of a nationwide putative class consisting of residential mortgagors charged for force-placed insurance in connection with loans serviced by Homeward from August 1, 2008 through April 30, 2013. Claims are asserted under the Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. 1961, et seq., and state law.

If you are homeowner who has been charged for force-placed insurance by Homeward or any other mortgage servicer, or if you wish to discuss these matters or have questions concerning this announcement or your rights, please contact Mark A. Strauss, Esq. by email at mstrauss@kmllp.com, or by telephone at (212) 371-6600, or toll free at (888) 529-4787. There is no cost or obligation to you.

Kirby McInerney LLP is a New York-based law firm concentrating in securities, whistleblower, antitrust, and consumer litigation. For additional information, please go to www.kmllp.com.