PNC Bank 2010 Annual Report Download - page 186
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Please find page 186 of the 2010 PNC Bank annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.things, unspecified actual, statutory and punitive
damages (including tripled actual damages under
RICO); accounting; disgorgement; preliminary and
permanent injunctive relief against foreclosure of the
affected mortgages; and attorneys’ fees. In January
2011, all defendants, including PNC, filed motions to
dismiss the complaint. These motions are still
pending.
• In February 2011, a lawsuit was filed in the Superior
Court of the State of California for Orange County
against PNC and numerous other financial institutions
and mortgage servicing organizations. The lawsuit
(National Organization of Assistance for Homeowners
of California, et al. v. America’s Servicing Company,
et al., (Case No. 30-2011-00447677-CU-OR-CXC))
has been brought as a class action by individual
plaintiffs, who allege that they have obtained loans
secured by deeds of trust on California real estate, and
by a non-profit organization which purports, along
with the individual plaintiffs, to represent a class of
similarly situated individuals. The plaintiffs contend,
among other things, that the defendants engaged in
misrepresentations and fraudulent concealment in
connection with the mortgage loan origination process,
engaged in wrongful foreclosure practices, caused
notices of default to be issued against the plaintiffs in a
manner not authorized by California law, made
inaccurate credit disclosures regarding the plaintiffs,
and disclosed the plaintiffs’ private information
without their authorization. The plaintiffs allege
violations, among other things, of various provisions
of California statutory law, the right to privacy
provisions of the California Constitution, the federal
Fair Credit Reporting Act and the Gramm-Leach
Bliley Act. The plaintiffs seek, among other things,
unspecified actual and punitive damages, statutory
civil penalties, restitution, injunctive relief, interest,
and attorneys’ fees.
Regulatory and Governmental Inquiries
As a result of the regulated nature of our business and that of a
number of our subsidiaries, particularly in the banking and
securities areas, we and our subsidiaries are the subject of
investigations, audits and other forms of regulatory inquiry, in
some cases as part of regulatory reviews of specified activities
at multiple industry participants, including those described
below.
Numerous federal and state governmental, legislative and
regulatory authorities are investigating practices in the
mortgage lending and servicing industries. PNC has received
inquiries from governmental, legislative and regulatory
authorities on this topic and is cooperating with these inquiries.
These inquiries may lead to administrative, civil or criminal
proceedings, possibly resulting in remedies including fines,
penalties, restitution, or alterations in our business practices and
in additional expenses and collateral costs. As a result of the
number and range of authorities conducting the investigations
and inquiries, as well as the nature of these types of
investigations and inquiries, among other factors, PNC cannot
at this time predict the ultimate overall cost to or effect on PNC
from potential governmental, legislative or regulatory actions
arising out of these investigations and inquiries.
PNC is one of the fourteen federally regulated mortgage
servicers subject to a publicly-disclosed interagency
horizontal review of residential mortgage servicing operations.
That review is expected to result in formal enforcement
actions against many or all of the companies subject to review,
which actions are expected to incorporate remedial
requirements, heightened mortgage servicing standards and
potential civil money penalties. PNC expects that it and PNC
Bank will enter into consent orders with the Federal Reserve
and the OCC, respectively, relating to the residential mortgage
servicing operations of PNC Bank. PNC expects that these
consent orders, among other things, will describe certain
foreclosure-related practices and controls that the regulators
found to be deficient and will require PNC and PNC Bank to,
among other things, develop and implement plans and
programs to enhance PNC’s servicing and foreclosure
processes and take certain other remedial actions, and oversee
compliance with the orders and the new plans and programs.
In addition, either or both of these agencies may seek potential
civil money penalties. Other governmental, legislative and
regulatory inquiries on this topic, referred to above, are on-
going, and may result in additional actions or penalties.
The SEC previously commenced investigations of activities of
National City prior to its acquisition by PNC. The SEC has
requested, and we have provided to the SEC, documents
concerning, among other things, National City’s capital-
raising activities, loan underwriting experience, allowance for
loan losses, marketing practices, dividends, bank regulatory
matters and the sale of First Franklin Financial Corporation.
The SEC has been conducting an investigation into events at
Equipment Finance LLC (EFI), a subsidiary of Sterling
Financial Corporation, which PNC acquired in April 2008.
The United States Attorney’s Office for the Eastern District of
Pennsylvania has also been investigating the EFI situation.
Our practice is to cooperate fully with regulatory and
governmental investigations, audits and other inquiries,
including those described above. Such investigations, audits
and other inquiries may lead to remedies including fines,
penalties, restitution or alterations in our business practices.
Other
In addition to the proceedings or other matters described
above, PNC and persons to whom we may have
indemnification obligations, in the normal course of business,
are subject to various other pending and threatened legal
proceedings in which claims for monetary damages and other
relief are asserted. We do not anticipate, at the present time,
that the ultimate aggregate liability, if any, arising out of such
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