(20-22398 36) BK 65 (81-106) (ECF-1 DE-1) 17-80728 Complaint Only

Case 20-22398-MAM Doc 36-3 Filed 12/18/20 Page 81 of 249
([KLELW&RYHU6KHHW

3DUW\
6XEPLWWLQJ )LUVW$PHULFDQ%DQN±-XGJPHQW&UHGLWRU([(&)1R

$GPLWWHG<HVRU1RFLUFOHRQH

'HEWRU6WHSKDQLH/\QQ6FKQHLGHU

&DVH1R0$0

Adv. No._________________
1DWXUHRI+HDULQJ0RWLRQIRU5HOLHIIURP$XWRPDWLF6WD\
'RFNHW1R

8QLWHG6WDWH%DQNUXSWF\&RXUW
6RXWKHUQ'LVWULFWRI)ORULGD

'DWHGBBBBBBBBBBBBBBBBBBB

%\BBBBBBBBBBBBBBBBBBBBB'HSXW\&OHUN
age 1 of 25
LAURENCE SCHNEIDER, Case No.:
Plaintiff PLAINTIFF'S COMPLAINT FOR:
1. VIOLATION OF THE FAIR

vs. CREDIT REPORTING ACT
2. VIOLATION OF THE FAIR DEBT
COLLECTIONS PRACTICES ACT
FIRST AMERICAN BANK, as 3. VIOLATION OF SECTION 5 OF
successor by merger to Bank of Coral THEFfCACT
Gables, LLC. 4. BREACH OF CONTRACT
Defendants
Jury Trial Demanded
17-cv-80728 MARRA/MATTHEWMAN
Plaintiff Laurence Schneider (hereinafter referred to as "Plaintiff") hereby alleges in this
Complaint against Defendant First American Bank, as successor by merger to Bank of Coral
Gables, LLC (hereinafter "FAB" or "Defendant") as follows:
NATURE OF THJS ACTION
This action arises out of Defendant's failure to provide financial services and debt collection
services in a manner consistent with its legal obligations under: (a) the Fair Credit Reporting Act
("FCRA"), 15 U.S.C. §§ 1681-168lx; (b) the Fair Debt Collection Practices Act ("FDCPA"), 15
U.S.C. §§ 1692-1692p; (c) the Federal Trade Commission ("FTC") Act, 15 U.S.C. § 44; and (d)
the Home Equity Line of Credit ("HELOC"). Pursuant to this action. Plaintiff seeks to obtain
monetary civil penalties, a permanent injunctio11; restitution, disgorgement, monetary damages.
and other equitable relief for Defendant's violations of the aforesaid Acts and breach of contract.
Federal Action ECF No. 1

Case 9:17-cv-80728-KAM Document 1 Entered on FLSD Docket 06/13/2017 Page 2 of 25
THE PARTIES
Plaintiff
1. Plaintiff is a citizen and domiciled in Palm Beach County, Florida, and the lawful owner
of a parcel of real property (hereinafter "Subject Property») located in Palm Beach County
at 17685 Pond Court, Boca Raton. FL 33496.
Defendant
2. Defendant FAB is an Illinois banking corporation conducting business in Palm Beach
County, Florida, with its principal place of business in Elk Grove _Village, Illinois.
3. Defendant FAB merged with the Bank of Coral Gables, a non-member of the Federal
Reserve System, effective December 5, 2014, acquiring the assets and assuming the
contractual obligations of the Bank of Coral Gables.
JURISDICTION AND VENUE
4. This Court has federal question jurisdiction pursuant to 28 U.S.C. § 1331.
5. This Court bas diversity jurisdiction pursuant to 28 U.S.C. § 1332(a) as the amount in issue
in this ·action exceeds $75,000, exclusive of interest, costs, and attorneys' fees, and is
between citizens of different states (Plaintiff is a citizen of Florida and Defendant is a
citizen of Illinois).
6. This Court has personal jurisdiction over the Defendant pursuant to Fla. Stat. § 48.193.
7. Venue lies in this District pursuant to 28 U.S.C. § 139l(b) because the Subject Property at
issue in this present lawsuit lies within the jurisdictional limits of this Court.
2
case 9:17-cv-80728-KAM Document 1 Entered on FLSD Docket 06/13/2017 Page 3 of 25
ALLEGATIONS COMMON TO ALL CLAIMS
8. This case arises from a purchase money, federally related first lien mortgage loan, which
Plaintiff executed simultaneously upon the closing and acquisition of the Subject Property
at issue.
Execution of HELOC on Subject Property
9. On July 26, 2006, Plaintiff and Stephanie L. Schneider purchased the Subject Property at
issue with cash and a cashier's check for $1,427,471,19 to serve as their principal residence.
10. On the same date, Plaintiff closed on a HELOC with the Bank of Coral Cables in the
amowit of $1,500,000.00 on the Subject Property. A copy of the HELOC is attached hereto
as Exhibit B to the Complaint.
11. The HELOC was obtained for personal and household purposes, which included a
substantial amount of interior woodwork, build out and completion of certain design
elements of the home, along with landscaping and required code upgrades.
12. Funding for tile HELOC was based upon a faulty and inflated property appraisal perfom1ed
in March 2006, valuing the home at $2,000,000.00.
13. According to the terms of the HELOC, Plaintiff's payment was due by the 11payment due
date."
14. Under the written tenns of the HELOC, Plaintiff's payment would be late if it was not
received within 15 days after the "Payment due date" on the periodic statement.
15. The written tenns ofthe HELOC do not specify a fixed day of the month by which payment
must be received.
16. Under the tenus of the HELOC, the balance upon which finance charges are chargeable is
determined by the beginning balance of the prior day, to which new advances are added
3
and payments and credits are subtracted. Finance charges are calculated on this balance
daily in accordance with the "daily balance method."
17. The written tenns of the HELOC, in relevant part, do not define new advances to include
interest charges.
18. Plaintiff took the first draw on the HELOC on March 3, 2007 and made regular interest
payments by the first of every month, which included interest calculated up to the 15th day
of the prior month.
Bank of Coral Gables• Merger with FAB
19. Upon infonnation and belief, FAB merged with the Bank of Coral Gables s~metime
between the months of November and December of 2014.
20. FAB has not provided evidence to Plaintiff that a merger with the Bank of Coral Gables
included an assignment and/or transfer and vested right to the Subject Property at issue or
the executed HELOC.
21. Plaintiff did not receive any letter of transfer of servicing from FAB or from the Bank of
Coral Gables regarding the subject HELOC.
FAB's Internal Error(s}
22. Plaintiffs first contact from FAB was by telephone in May 2015, in which FAB advised
Plaintiff that if he "did not pay past due amounts owed on the subject HELOC, FAB would
foreclose.H
23. During the call, FAB representatives advised the Plaintiff that FAB had merged with the
Bank of Coral Gab1es and that FAB now owned both his HELOC and underlying
mortgage.
4
24. During this May 2015 telephone conversation, FAB representatives confinned that FAB
had sent notification of loan transfer (RESPA Letter} and statements to an incomplete post
office box mailing address and with the subject properties' city, state, and zip code.
25. Plaintiff advised FAB that all incorrect mail would not necessarily be forwarded and that
he had not yet received any such forwarded mail from FAB.
26. On May 28, 2015, Plaintiff received wire instructions for the May 1, 2015 and April l,
2015 payments from FAB representatives.
27. Plaintiff requested verification of the account number because there was no pre-existing
account or loan number with FAB.
28. FAB advised Plaintiff to continue using the Bank of Coral Gables account number and his
name for identification for wire payment purposes.
;Plaintiff Made Timely Payments on the HELOC
29. On May 28, 2015, Plaintiff sent his April 1, 2015 and May 1, 2015 pnyments by wire.
30. On May 29, 2015, upon request, FAB confirmed receipt of payments that were due on
April 1, 2015 and May I, 2015.
31. On Jwie 1, 2015, Plaintiff wrote to FAB, advising that he had not received an invoice for
his Jwie 1, 2015 payment. and therefore did not know the amount owed for the June 1,
2015 payment.
32. On June 3, 2015, James Kielbasa of FAB apologized to Plaintiff via email for the late
response and advised that the amount due for the June l, 2015 payment was $4,427.64. Mr.
Kielbasa requested confinnation of receipt of the July 1, 2015 statement.
5
FABts Misrepresentations and Misappropriations
33. On June 5, 2015, Jennifer Anderson, Vice President at First American Bank sent Plaintiff
a letter which acknowledged that FAB's clerical errors occurred during the recent merger
with Bank of Coral Gables. FAB sent confinnation that it had erroneously printed an
incorrect billing address and due to FAB's clerical error, Plaintiffs payments were "not
considered late'' [Emphasis Added].
34. Ms. Anderson also stated, "Today, we have asked the credit agencies to correct your credit
file to satisfactory status." Ms. Anderson provided the Plaintiff the name, address, phone
number and website information for Experian, Trans Union, Equifax and lnnovis. A copy
of the June 5, 2015 Letter from Jennifer Anderson is attached herewith as Exhibit B to the
Complaint.
35. FAB's clerical error occurred during its merger with the Bank of Coral Gables, and FAB
assured Plaintiff that the delinquencies reported in April 2015 with all three credit bureaus
would be immediately corrected.
36. This was not, and at the time of filing this Complaint, done, despite reassurances from
FAB, which was in breach of the implied covenant of good faith and fair dealings, along
with the express tenns of the HELOC.
37. FAB, however, continued to calculate accrued interest on the outstanding balance, which
included the late fees, even though the late fees were represented to Plaintiff as having been
reversed.
38. On Jnne 8, 2015, Plaintiff reaffirmed to FAB that payment for the periodic billing due June
1, 2015, was immediately made on June 5, 2015, as instrncted.
6
39. On June 20, 2015 Plaintiff wrote to FAB's James Kielbasa, atiinning receipt of the
statement for the July 1, 2015 payment due date and confirmed FAB's use of Plaintiff's
co11ect mailing address.
40. On the same day, Plaintiff sent a written request for the year to date charge/payment history
and a copy of the promissory note to reconcile the interest with the outstanding balance
owed on the HELOC.
41. On June 26, 2015, Plaintiff informed Milton Espinoz.a, Vice President, and Commercial
Loan Relationship Manager at FAB, that he was continuing to be billed for late charges
prior to the payment due date and that this advanced billing was part of the continuing
problems Plaintiff was encountering with his account.
42. Plaintiff advised FAB that the loan was boarded by FAB with numerous errors, including
a wrong billing address which delayed Plaintiffs receipt of monthly statements, and made
yet another written demand for copies of the note, mortgage, and the year to date payment
history in an attempt to reconcile interest charged and outstanding balance to date.
43. Milton Espinoza of FAB provided Plaintiff with a partial loan history, which was dated
June 26, 2015, but which neither offered nor provided an explanation of the partial loan
history extracted from FAB's recordkeeping systems.
44. On June 26, 2015, Milton Espinoza emailed Plaintiff pdf versions of the promissory note
and mortgage from the Bank of Coral Gables.
45. On June 27, 2015, Plaintiff emailed a written request for explanation to Milton Espinoza
regarding FAB' s s July 1, 2015 statement and attached the July statement referenced in the
letter to request clarification about whether the due date was the 1st or 15th of every month,
7
Case 9:17-cv-80728-KAM Document 1 Entered on FLSD Docket 06/13/2017 Page B of 25
because FAB's system continued to record payments as late and assessed a late charge on
each of Plaintiffs payments.
46. On July 15, 2015, FAB received $4,055.91 through a wire payment from Plaintiff for the
July l, 2015 billing amount owed.
47. In July 2015, Plaintiff called the customer servicer number listed on the .FAB periodic
statement, for clarification of the amount due and that the account was in good status.
However. the customer service agent could not provide Plaintiff any accurate infonnation
as to either question. After keeping Plaintiff 011 hold for fifteen minutes, he crune back on
the phone, informing Plaintiff that he had to check with his supervisor and would return
the call. Plaintiff never received a return call from FAB customer service.
48. On August 8, 2015, Plaintiff wrote to FAB's Brian Hagan regarding the settlement of the
HELOC, noting the derogatory reporting on credit due to incorrect loan boarding and
incompetence by FAB and provided a copy of the June 5, 2015 letter from Ms. Anderson
to Plaintift~ acknowledging that it was FAB's fault for the billing errors.
49. On August 28, 2015, FAB received $4,297.83 via a wire payment from Plaintiff.
50. On September 30. 2015, FAB received $3,977.53 via a wire payment from Plaintiff. On
the same day, Plaintiff wrote to FAB's authorized representative, Brian Hagan, confirming
his September 1, 2015 payment on the HELOC accoWlt, advising of flawed information in
the servicing system of records, directing FAB to apply the payment accordingly, and
noting his frustration concerning FAB's continuing erroneous and derogatory reporting of
the account, despite numerous requests to FAB to correct the infonnation and Defendant's
promises to do so.
8
51. On October I, 2015, Brian Hagan confinned receipt of Plaintiff's September 30, 2015
payment and requested that Plaintiff call him with any questions regarding the October 1,
2015 payment.
52. On October 27, 2015, Plaintiff called the FAB's customer service number listed on the
Periodic Billing Statement; however, customer service responded that they were unable to
determine the HELOC account infonnation wi1h accuracy at that time.
53. On October 27, 2015, Plaintiff again wrote to Brian Hagan to address FAB's failure to
address and remediate its flawed systems of records, which continued to report that the
HELOC account was delinquent for six months and more than 30 days past due for October
2015, thereby fraudulently corrupting credit worthiness and resulting in several failed
attempts to secure financing and the customer service department's inability to determine
the last paid date and next due date of the mortgage loan.
54. An October 27, 2015 credit report obtained by Plaintiff indicated that FAB had reported
delinquencies for payments due on October 2015 and September 2015 with all three credit
bureaus, along with a balance of$1,495,469.00. A copy of the October 27, 2015 credit
report is attached hereto as Exhibit C to the Complaint.
55. According to this October 27.2015 credit report of Plaintiff, FAB reported the last activity
was in October 2015. According to the tri-merge credit report, FAB showed Plaintiff to be
$3,982 past due. Furthermore, the report stated that Plaintiff was between 30-59 days late,
twice in October 2015 and September 2015. Again, before the month of October had even
expired, FAB had already informed the credit bureaus that Plaintiff's October l, 2015
payment was already over 30 days late, in addition to not removing the late payment
notification for the September I, 2015 HELOC payment.
9
case 9:17-cv-80728 -KAM Document 1 Entered on FLSD Docke t 06/13/
2017 Page 10 of 25
56. On October 30, 2015, Plaintiff wrote to Brian Hagan to inquire about how FAB
would
remediate the continued erroneous credit reporting of the HELOC account and
the harm
such en·oneous reporting had caused Plaintiff to date. Plaintiff again requested
a complete
payment history of the account from origination, as well as a copy of the entire
origination
file, along with any and all prior billing statements, notices, and other corresp
ondence
pertaining to the origination and servicing of the loan and asked that the request
be deemed
a qualified written request. On the same date, Plaintiff also asked for an explana
tion for
the failure of the application of the September 2015 payment, as the promised verifica
tion
did not occur and the September 2015 payment was not applied properly.
57. On October 30, 2015, Brian Hagan wrote back to thank Plaintiff for the email and
to advise
him that the October 1, 2015 payment in the amount of$4,64 6,05 was due, along
with the
November 1, 2015 payment in the amount of $3,823.29. Brian Hagan also request
ed that
the Plaintiff provide his personal tax returns and personal financial statement
for
consideration of a deed in lieu.
58. On October 30, 2015, FAD received $4,646.05 from Plaintiff.
59. On November 4, 2015, Plainti ff again wrote to FAB's authorized representative,

Brian
Hagan, requesting information and documentation regarding .the steps FAB had
taken to
ensure that the erroneous reporting made by F AB to the credit bureaus had been
remedied,
as Plaintiff's credit was continuing to suffer as a direct and proximate result
of FAB's
failure to apply Plaintiff's paymen'ts to the HELOC account and continued reportit
lg of
negative and inaccurate information to all credit agencies. PJaintiff specifically
cited the
need for docwnentation and included a copy of the correspondence that F AB
sent to the
credit agencies, acknowledging that Plaintiff's payments had been timely.
10
case 9:17-cv-80728-KAM Document 1 Entered on FLSD Docket 06/13/2017 Page
11 of 25
60. On November 4, 2015, Brian Hagan responded that he was in possession of the payment
history, which would be sent to Plaintiff, and that although he had been advised that the
credit reporting was accurate, he would "double check" and provide Plaintiff with the
correspondence between FAB and the credit reporting agencies regarding the matter. A
copy of the email exchange between Plaintiff and Brian Hagan is attached hereto as Exhibit
D to the Complaint.
61. No such correspondence was ever received from Brian Hagan or FAB.
62. On November 5, 2015, Plaintiff again wrote to Brian Hagan expressing extreme concern
over assurances by FAB employees regarding the accuracy of the credit reporting since
Plaintiff's payments were reported as late.
63. When Plaintiff asked for an explanation from Brian Hagan as to why he was marked
delinquent on the account when Brian Hagan confirmed that his status was current, Plaintiff
was advised to deal only with Brian Hagan. This was specifically because FAB's billing
records were severely corrupt by FAB's multiple clerical errors 1 misapplication ofHELOC
payments, incorrect billing cycles and erroneous boarding of Plaintiff's HELOC
infonnation at the time of merger with Bank of Coral Gables. The culmination and
compounding of these errors made it impossible for anyone at FAB to provide Plaintiff
with timely and accurate information regarding Plaintiffs federally related mortgage loan.
FAB also wanted to keep the matter contained and not expanded through inquiries with
FAB's loan servicing department.
64. Plaintiff was now to rely on Mr. Hagan's infonnation and communication as to how much
the monthly payment would be each month.
65. Thus1 Plaintiff made multiple payments as directed by Brian Hagan himself.
11
66. Plaintiff again requested detailed explanations fur interest rate calculations, specific billing
cycle infonnation for the months of September 1, 2015, October 1, 2015, and November
1, 2015, and the reason 11the information which you have provided to me below and
represented to be accurate differs from the information contained in the bank's servicing
system of records for these two periods."
67. On November 12, 2015, Brian Hagan advised the Plaintiff that he had not yet received the
financial infonnation requested by FAB.
68. On November 16, 2015, Plaintiff communicated with Brian Hagan regarding the
completion of the financial information fonn and FAB's requests for information from
Plaintiff, and provided F AB with the documentation requested by F AB, which included
tax returns and W-2 forms.
69. On November 17, 2015 Plaintiff had absolutely no idea of how much his monthly HELOC
payment was supposed to be. Plaintiff wired FAB an arbitrary amount of$4,500.0 0.
70. On November 18, 2015, Plaintiff, in his capacity as guarantor of 1st Fidelity Loan
Servicing, received another communication from Ms. Cabrera of Bank United, in which
she again explains, "Per our conversation, as part of our loan conditions from time to time
we review guarantor's credit and yours has been addressed. Please provide letter of
explanation and supporting documentation ofdocumentation ofresolutio n to credit report."
71. Apparently, the proof of wired payments and several communications between Plaintiff
and F AB, was not sufficient evidence.
72. On November 18, 2015, Brian Hagan advised the Plaintiff that "it looks like FAB has
received everything it needs from [Plaintiff] and will review it promptly." Later the same
day, Plaintiff advised Brian Hagan that because of the false credit information provided by
12
case 9:17-cv-80728-KAM Document 1 Entered on FLSD Docket 06/13/2 017
Page 13 of 25
FAB, Bank United had suspend ed business lines of credit solely on the basis of the negative
reporting on the personal credit report, which was, and continues to be, erroneous.
73. On Novemb er 19, 2015, Brian Hagan and Plaintiff met, but FAB did not provide Plaintiff
with an explanat ion for or the requested details regarding the loan, paymen t histories or the
accounti ng for the HELOC loan. Late the same day, Plaintiff again wrote to F AB to request
remedia tion ofthe reporting errors and a letter to rectify the damagin g infonnat ion supplied
to credit agencies which was destroyi ng Plaintiff 's credit rating, score, and worthiness
in
the eyes of potential lenders. Furthermore, Plaintiff reminded Mr. Hagan that, "during
a
QWR, the bank is required to NOT make any negative reportin g to the credit
...repositories."
74. On Novemb er 20, 201S, Brian Hagan wrote to Plaintiff regarding possible settleme
nt
strategies and confirmed that FAB had run a credit report to ensure that Plaintiff 's account
was not showing past due payments and that, as agreed, reportin g included all payment
s.
Later the same day, Plaintiff wrote to express his gratitude to Brian Hagan for making
corrections to the credit reports and requested docume ntation regarding the paymen
t
history of the loan since origination and all executed loan documents.
7S. On Novemb er 30, 2015, Plaintiff received a letter from Henry Bolz, of Keller & Bolz, LLP,
notifying Plaintiff the he represents First American Bank ("FAB"). Mr. Bolz' letter stated:
'"Ibis letter responds to that email which you sent to Brian Hagan at 3:05 p.m. on
Friday, October 30, 2015. That email can arguably be viewed as an attempt by you to
dispute directly with FAB, in accordance with 15 U.S.C. § 1681s-2(a) (8) of the
Consum er Credit Protection Part of the Fair Credit Reportin g Act ("FCRA "),
infonnat ion that FAB provided to credit reportin g agencies earlier this year."
"In accordance with the FCRA, FAB has conducted an investigation and reviewed that
information in which you provided with respect to the disputed late paymen t
infom1ation you identified. After complet ing its investigation, F AB communicated
13
case 9:17-cv-80728-KAM Document 1 Entered on FLSD Docket 06/13/2
017 Page 14 of 25
with all of the major/national credit reporting agencies and advised them that all of
you
past due payment notices have been reversed, and that you had been making
all
payments as agreed. This letter is being timely sent to you in accordance with 15 U.S.C.
§ 1681i".
"Your November 18, 2015 (7:48 p.m. EST) and November 19, 2015 (4:37 p.m. EST)
emails to Brian Hagan indicate that in addition to "immediately remediatit1g
the
reporting errors" (done), FAB needs to "send any letters needed to rectify the hanns"
and identifies the Bank United-1st Fidelity revolving line of credit as having been
affected. Do you still want/need FAB to write to Bank United (or might a letter now
be unnecessary)? Please let me know."
A copy of the letter to Plaintiff from Mr. Bolz is attached hereto as Exhibit D
to the
Complaint.
76. This was now the fourth time a representative of FAB or counsel representing FAB
had
acknowledged the ongoing billing errors according to the FCRA, and their require
ment to
rectify FAB systems of record to properly report Plaintiff's credit file.
77. Mr. Bolz' letter also specifically instructed Plaintiff; that all future correspondenc
e
regarding these matters addressed should specifically be with his firm, and not FAB:
"All further requests for information for documents in any fashion relate to
any
complaints or disputes that you might have pursuant to the FCRA should be address
ed
to the undersigned at the above address of this correspondence.',
78. Thus, Mr. Bolz has not only admitted that FAB had made errors according to the FCRA,
he is also aware of the Bank United-1st Fidelity LOC being terminated due to
FAB's
reporting errors.
79. According to this letter and a communication confirmed by Mr. Hagan, Plaintiff was
now
supposed to receive my payment billing and payment information from Mr. Bolz, who
did
not jdentify himself as a debt collector in his November 30, 2015 letter to Plaintiff.
14
case 9:l7-cv-80728-KAM Document 1 Entered on FLSD Docket 06/13/2017 Page
15 of 25
80. On January 7, 2016 and January 9, 2016, FAB reported Plaintiff wns 30 days late in making
a paymen t on the HELOC . A copy of the email notifying Defenda nt about the derogato
ry
credit reporting on January 7, 2016 and January 9 is attached hereto as Exhibit F to the
Complaint.
81. Again, since Plaintiff had absolutely no idea of how much his monthly HELOC paymen
t
was suppose d to be, on January 14, 2016, Plaintiff wired FAB an arbitrary amount
of
$4,800.0 0 via wire payment. Mr, Hagan confirmed receipt of the payment.
82. On January 18, 2016, Plaintiff wrote to Henry Bolz and carbon copied Brian Hagan, Gary
Smith, and James Berton of FAB, to reiterate the ongoing erroneous servicing caused
by
the lack of quality control and openly questioned why no one at the bank would investiga
te,
provide an account history, or review the loan documents, and requested the correction
of
the false reporting and a retraction of the erroneous information, which was causing
financial difficulties as a result of the balloon mortgage on the Subject Property.
83. On January 25, 2016, Plaintiff once again had absolutely no idea of how much his monthly
HELOC paymen t was supposed to be, and thus wired FAB an arbitra1y amount
of
$4,500.00,
84. On February 17, 2016, Plruntiff once again wired FAB an arbitrary amount of $4,500.0
0.
85. On March 15, 2016, Plaintiff once again wired F AB an arbitrary amount of $4,500.00.
86. On April 6, 2017, Plaintiff once again wired FAB an arbitrary amount of $4,500.0 0.
87. On June 13, 2016, Brian Hagan requested that Plaintiff provide FAB with a complet
ed
personal financial statement.
15
case 9:17-cv-80728-KAM Document 1 Entered on FLSD Docke
t 06/13/2017 Page 16 of 25
88. On June 30, 2016, Plainti ff wrote to Brian Hagan regarding the
sensitive financial
information requested by FAB, and provided attachments to several of
Plainti fl's financial
forms that documented the remitted debt.
89. On July 7, 2016, Plainti ff received a delinquency letter from FAB for
the months of May,
June, and July 2016, which advised Plainti ff that the current amount owed
was $59,481.27,
of which $50,154.44 was due for the June 1, 2016 payment.
90. Plaint iff alleges that no rational explanation, calculation, or information

was included with
the one page request for payment
91. On August 9, 2016, Plaint iff contacted Brian Hagan to provide the financi
al h'lformation
requested by FAB.
92. Plaint iff subsequently advised that FAB has caused delinquency
and severely
compromised the ability of entities in which he is a guarantor to
obtain personal and
•business credit on multiple occasions due to FAB's negligent servici
ng practices.
93. FAB had not, and to date has not, remedied the past due status of the
subject HELOC.
94. FAB reported to the Equifax credit agency .that Plainti ff was 30
days late in makin g
payment in May 2016, 60 days late in June and July of 2016, and 120 days
late every month
since.
95. Since April 3, 2017, the TransUnion credit agency has reported that the
outstanding balance
has been $1A95,457.00
96. The credit agencies, Equifax, and Experian, continue to report an

unpaid balance of
$1,708,894.00 and falsely st.ate that the Plainti ff is using 114% of the
HELO C limit.
97. On February 20, 2017, an Experian report revealed data that contradicted
the verbal and
written statements of FAB and reported no data for the months of Januar
y and February
16
case 9:17-cv-80728-KAM Document 1 Entered on FLSD Docket 06/13/2
017 Page 17 of 25
2016, even though FAB received $9,300.00 on January 25, 2016 from the Plaintif
f. A copy
of the Experiw i credit report is attached hereto as Exhibit G to the Complaint.
98. FAB has added fees for which no explanation or information has been provide
d; and upon
information and belief, FAB has added, and will continu e to add fees and
costs not
contemplated or agreed to by the HELOC that would make the loan usurious.
A copy of a
response to a Qualified Written Request made by Plaintif f with a full paymen
t history m1til
May 24, 2017 is attached as Exhibit H.
COUNT 1-VIOLATIQN OF THE FAIR CREDIT REPORTING ACT
99. Plaintif f re-alleges and incorporates by reference all precedi ng paragraphs.
100. Section 623(a) of the FCRA describes the duties of fumish ers to provide
accurate
informa tion to Credit Reporting Agencies ("CRA s"). Section 623(a)( l)(B)
prohibits
furnishers from providi ng information relating to a consum er to any CRA if
(i) the person
has been notified by the consumer, at the address specifie d by the person for
such notices,
that specific information is inaccurate; and (ii) the infonna tion is, in fact, inaccur
ate.
101. In the instant case at bar, Plaintif f has been misled by FAB, and receive d misinfo
rmation
as to the validity of the debt owed, which was, and is, the subject ofthis action.
102. Despite proof from Plaintif f to the contrary, in nwnero us instances, FAB has
continued to
furnish information to a CRA relating to Plaintif f when (a) FAB was notified
by Plaintif f
that specific information was inaccurate and (b) the infonna tion was in fact,
inaccurate.
103. Further compounding this fraud are the misrepresentations detailed above in
the preceding
paragra phs of this Compla int demonstrating that F AB failed in its duty.
104. The acts and practic es alleged above constitute violatio ns of Section 623(a)(
l)(B) of the
FCRA, 15 U.S.C. § 168ls-2 (a)(l)(B ).
17
18 of 25
105. Section 623(b)(l) of the FCRA further requires furnishers of information to CRAs to
conduct an investigation when the furnisher receives a notice of dispute from a CRA in
accordance with the provisions of Section 6ll(a)(2 ) ofthe FCRA, 15 U.S.C. § 1681i(a)(2),
and to report the results of the investigation to the CRA.
106. FAB failed to report the results of its investigation(s) to the CRA.
107. Section 623(aX3) of the FCRA provides that if the completeness or accuracy of the
information furnished by any person to any CRA is disputed to such person by any
consumer, the information must be noted as disputed in the information reported by such
person to any CRA. This particular provision does not require consumer disputes to be in
writing.
108. Nonetheless, each and every documented effort by Plaintiff to validate the debt was in
writing, further highlighting the egregiousness of the behavior of FAB.
109. Section 621 of the FCRA, 15 U.S.C. § 1681 s, authorizes the Court to award monetary civil
penalties of not more than $2,500 per violation for each violation of Sections 623(a)(3) and
1
623(b) of the FCRA.
110. Each instance in which FAB has violated Sections 623(a)(3) and 623(b) of the FCRA
constitutes a separate violation of the FCRA for which Plaintiff seeks monetary civil
penalties under Section 621 of the FCRA. 15 U.S.C. § 1681s.
111. FAB has engaged in knowing violations ofthe FCRA as described above, which constitute
a pattern or practice of violation.
112. FAB is liable to Plaintiff in an amount to be proven at trial.
COUNT II-VIOLATION OF THE FAIR DEBT COLLECTION PRACTICES ACT
113. Plaintiff re-alleges and incorporates by reference all preceding paragraphs.
18
case 9:17-cv-80728-KAM Document 1 Entered on FLSD Docket06/13
/2017 Page 19 of 25
114. Section 814 of the FDCPA, 15 U.S.C. § 1692e, holds that a violation of the FDCPA
shall
be deemed an unfair or deceptive act or practice.
115. In connection with the collection of a debt, FAB, directly, and indirectly,
used false,
deceptive, or misleading representations or means in violation of Section
807 of the
FDCPA, 15 U.S.C. § 1692e, including, but not limited to the following:
116; FAB, directly, or indirectly, used false representations concerning the charact
er, amount,
or legal status of Plainti ffs aUeged debt, which was in violation of Section 807(2)(
A) of
the FDCPA, 15 U.S.C. § 1692e(2)(A).
117. FAB, directly, or indirectly, failed to communicate to the CRAs Plainti frs alleged
debt
and that the debt is disputed, which was in violation of Section 807(8) of the FDCP
A, 15
l].S.C. § 1692e (8).
118. The acts and practices alleged above constitute violations of Section 807 of the
FDCPA,
15 U.S.C. § 1692e.
119. Each instance within five (5) years preceding the filing of this Complaint,
in which
Defendant FAB has failed to comply with the FDCPA in one or more of the ways
described
above, constitu1es a separate vio1ation for which Plaintiff seeks monetary civil
penalties.
120. FAB is liable to Plaintiff in an amount to be proven at trial.
COUNT Ill-VIOLATION OF SECTION 5 OF THE FfC ACJ

121. Plaintif f re-alleges and incorporates by reference all preceding paragraphs.
122. Section S(a) of the FTC Act, 15 U.S.C. § 45(a), prohibits "unfair or decepti
ve acts or
practices in or affecting commerce." Representations of material fact that are
false or
misleading constitute deceptive acts or practices prohibited by the FTC Act.
19
case 9:17-cv-80728-KAM Docum ent 1 Entered on FLSD Docket 06/13/2017
Page 20 of 25
123. As alleged above, in numerou s instances and through the means described above, in the
course of collectin g debts from Plaintiff, FAB, directly, and indirectly, has falsely
represen ted to Plaintiff, expressly or by implication, that the debt was valid and that
Plaintiff had an obligatio n to pay the debt.
124. ln truth and in fact, in numerous instances the material representations set forth above were
false or FAB did not have a reasonable basis for the representations at the time the
representations were made to Plaintiff.
125. Therefore, the representations set forth above made to Plaintiff were false or misleading
and constitute deceptive acts or practices in violation of Section 5(a) of the FTC Act,
15
U.S.C. § 45(a).
126. FAB violated the FDCPA as described above, with actual knowled ge or knowledge fairly
implied on the basis of objective circumstances, as set forth in Section 5(m)(1)(A) of the
FTC Act, 15 U.S.C. § 45(m)(l) (A).
127. Section S(m)(1XA) of the FTC Act, 15 U.S.C. § 45{m)(l )(A), Section 814(a) of the
FDCPA , 15 U.S.C. § 1692(e), and Section 4 of the Federal Civil Penalties Inflation
Adjustm ent Act of 1990, 28 U.S.C. § 2461, as amended, authorize the Court to award
monetar y civil penalties of not more than $11,000 for each violation of the FDCPA.
128. In this matter, there have been more than 20 instance s of said violation(s), totaling a civil
penalty owed to Plaintiff in the amount of $220,000.00.
129. As such, Plaintiff prays for judgmen t in an amount to be proven at trial, but no less than
$220,000.00
COUNT IV-BREACH OF CONTRACT

130. Plaintiff re-alleges and incorporates by reference all precedin g paragraphs.
20
case 9:17-cv-80728-KAM Document 1 Entered on FLSD Docke
t 06/13/2017 Page 21 of 25
131. The contract at issue is the HELOC signed by Plaintiff with the Bank of
Coral Gables,
which bank subsequently merged with FAB.
132. The HELOC, the written contract upon which FAB relies for payments
from Plaintiff,
states in relevant part, ''to be effective any change or amendment to this mortga
ge must be
in writing and must be signed by whoever will be bound or obligated by
the change or
amendment."
133. Pursuant to the HELOC, the balance upon which the finance charge is applica
ble is to be
calculated as follows: "To get the da,ily balance, we take the beginning balanc
e of your
Credit Line Account, each day, add new advances and subtract any payme
nts or credits
and any unpaid finance charges."
134. The HELOC defines a specific "payment due date" as "the date 011 the period
ic statement."
135. Since 2007, all statements and course of dealings relating to the HELOC design
ated the 1st
of the following month as the payment due date.
136. Since 2007, and in the course of business dealings relating to the HELOC,
the 15th of the
prior month was designated as the date cutoff for finance charges due by
the 1st of the
following month.
137. Since 2007, and in the course of business dealings relating to the HELOC,
an 11average
daily balance" on the monthly statements was intended for purposes of illustra
tion only.
138. FAB unilaterally changed the periodic finance charge cutoff dates.
139. FAB w1ilaterally added charges in calculating the daily balance in contra
vention of tl1e
HELOC.
21
22 of 25
140. FAB employed inadequate and failed processes and systems to boai-d Plaintiffs loan, and
proceeded to erroneously service the loan without remedying the deficiencies in the
onboarding process.
141. FAB's faulty servicing included erroneous porting of the mailing address of Plaintiff,
which caused Plaintiffto fail to receive notices and monthly statements for a period of over
5 months, unilateral change to the payment due dates, unilateral change to the cut-off date
for calculation of applicable interest due each payment period, and erroneous application
of payments to interest and principal.
142. FAB's mishandling of the servicing of the loan as described above was continuing and
spanned the period from December 2014 through the filing of the instant suit.
143. If and when FAB properly took over the servicing ofthe loan, FAB assumed the obligations
of1he HELOC.
144. The erroneous porting and servicing caused FAB to make false statements of material fact
consisting of wrong postings of interest and principal payments and inflated monthly
billings that included improper late charges and fees.
145. FAB's conduct represented a breach of the HELOC.
146. Along with the contractual breaches, FAB, through its actions, also breached its contractual
covenant of good faith and fair dealing.
147. The contractual covenant of good ~aith and fair dealing required each party to the contract
to be honest in its deaJings and to not purposefully take actions that would unfairly prevent
other parties from enjoying their rights or benefits under the contract or disappoint their
reasonable expectations. Good faith and fair dealing in connection with the discharging of
performance and other duties according to their tenns means preserving the spirit-n ot
22
case 9:17-cv-80728-KAM Document 1 Entered on FLSD Docket 06/13/
2017 Page 23 of 25
merely the letter- of the bargain. Evading the spirit of the bargain and abusing the
power
to specify terms constitutes examples of bad faith in the performance of contracts.
148. FAB was notified in writing on numerous occasions of the errors by Plaintiff, and
failed
time and time again to rectify the tlawed servicing processes causing the incorrect data
and
faulty reporting to continue,
149. FAB further breached the contractual covenant of good faith and fair dealing when
its
representatives stated to Plaintiff that the errors had been corrected and issues rectifie
d
when in fact they had not.
150. FAB, through its representatives, continued to breach the contractual covenant of
good
faith and fair dealing by making materially false assertions regarding the corrections
and
rectification of servicing errors while aware that FAB's agents could not ascertain whethe
r
or not they were true or, in the alternative, while FAB's agents knew or should have known
that the statements were false and likely to damage Plaintiff.
151. FAB knew that the continuation of such statements would interfere with Plaintiffs
ability
to establish creditworthiness, a necessary component for establishing payment alternat
ives
and financing as a principal guarantor of other businesses.
152. In failing to disclose all information as required by law and requested by Plaintiff,
FAB
willfully rendered imperfect performance, abused the power of the creditor in the HELOC
by unilaterally changing terms, failed to cooperate and hindered Plaintiff's perfonn

ance,
and thus materially breached the I-IELOC before Plaintiff's perfonnance became due.
153. FAB further breached the HELOC and the contractual covenant of good faith and
fair
dealing contained therein by instituting flawed boarding procedures, failing to provide
written notices to Plaintiff as required, unilaterally changing the terms of the loan,
failing
23
case 9:17-cv-80728-KAM Document 1 Entered on FLSD Docket 06/13/
2017 Page 24 of 25
to remedy faulty paymen t calculations and applications of payments received,

starting from
January 2015 through July 2016 that Plaintif f was late each month despite receivin
g
payments as directed, failing to provide information to the Plaintif f, as request
ed repeatedly
to remedy any issue, and, ultimately, failing to cooperate a11d interfering with
Plainti ffs
continued performance under the HELOC .
154. Plainti ff has been seriously and significantly banned for damages by Defend
ant's breach
of the HELOC in an amount to be proven at trial, but no less than $220,000.00.
PRAYER FOR RELIEF

WHEREFORE. Plaintiff, respectfully requests that the Court:
1. Award such relief as the Court finds necessary to redress injury to Plainti
ff resulting from
Defend ant's violations of the FfC Act, the FDCPA , and the FCRA, includi
ng but not
limited to, rescission or reformation of contracts, restitution, the refund ofmonies
paid, and
the disgorgement of ill-gotten gains;
2. Award Plaintif f monetary civil penalti es for each violation of the FCRA as
alleged in this
Compla int;
3. Award Plaintif f moneta ry civil penalti es for each violation of the FDCPA
occurri ng within
the five years precedi ng the filing of this Complaint;
4. Award Plaintif f moneta ry civil penal~ies in an amount no less than

$220,000.00 for
violation of the FTC;
5. Award Plaintif f monetary damages for Defend ant's breach of the HELOC
; and
6. Award Plaintif f the costs of bringin g thi~ action, as well as such other and
additio nal relief
as the Court may determine to be just and proper.
24
Respectfully Submitted,
Date: June 13, 20 l 7
Boca Raton, FL
LAURENCE S. SCHNEIDER, Pro Se

360 E. COCONUT PALM DRIVE
BOCA RATON, FL 33432
laITy@sacapitalpartners.com
25

(20-22398 36) BK 65 (81-106) (ECF-1 DE-1) 17-80728 Complaint Only

Uploaded by

Copyright:

Available Formats

You might also like

(20-22398 36) BK 65 (81-106) (ECF-1 DE-1) 17-80728 Complaint Only

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

(20-22398 36) BK 65 (81-106) (ECF-1 DE-1) 17-80728 Complaint Only

Uploaded by

Copyright:

Available Formats

Case 20-22398-MAM Doc 36-3 Filed 12/18/20 Page 81 of 249

LAURENCE SCHNEIDER, Case No.:

Plaintiff PLAINTIFF'S COMPLAINT FOR:

1. VIOLATION OF THE FAIR

Gables, LLC (hereinafter "FAB" or "Defendant") as follows:

NATURE OF THJS ACTION

monetary civil penalties, a permanent injunctio11; restitution, disgorgement, monetary damages.

Federal Action ECF No. 1

at 17685 Pond Court, Boca Raton. FL 33496.

2. Defendant FAB is an Illinois banking corporation conducting business in Palm Beach

contractual obligations of the Bank of Coral Gables.

JURISDICTION AND VENUE

4. This Court has federal question jurisdiction pursuant to 28 U.S.C. § 1331.

between citizens of different states (Plaintiff is a citizen of Florida and Defendant is a

ALLEGATIONS COMMON TO ALL CLAIMS

Execution of HELOC on Subject Property

as Exhibit B to the Complaint.

in March 2006, valuing the home at $2,000,000.00.

daily in accordance with the "daily balance method."

of the prior month.

Bank of Coral Gables• Merger with FAB

between the months of November and December of 2014.

the executed HELOC.

Coral Gables regarding the subject HELOC.

FAB's Internal Error(s}

2015 payments from FAB representatives.

account or loan number with FAB.

name for identification for wire payment purposes.

;Plaintiff Made Timely Payments on the HELOC

April 1, 2015 and May I, 2015.

Kielbasa requested confinnation of receipt of the July 1, 2015 statement.

FABts Misrepresentations and Misappropriations

considered late'' [Emphasis Added].

would be immediately corrected.

with the express tenns of the HELOC.

1, 2015, was immediately made on June 5, 2015, as instrncted.

co11ect mailing address.

owed on the HELOC.

problems Plaintiff was encountering with his account.

history in an attempt to reconcile interest charged and outstanding balance to date.

history extracted from FAB's recordkeeping systems.

and mortgage from the Bank of Coral Gables.

each of Plaintiffs payments.

July l, 2015 billing amount owed.

determine the HELOC account infonnation wi1h accuracy at that time.

report is attached hereto as Exhibit C to the Complaint.

notification for the September I, 2015 HELOC payment.

58. On October 30, 2015, FAD received $4,646.05 from Plaintiff.

59. On November 4, 2015, Plainti ff again wrote to FAB's authorized representative,

Plaintiff's payments were reported as late.

payments, incorrect billing cycles and erroneous boarding of Plaintiff's HELOC

FAB's loan servicing department.

the monthly payment would be each month.

system of records for these two periods."

financial infonnation requested by FAB.

tax returns and W-2 forms.

explanation and supporting documentation ofdocumentation ofresolutio n to credit report."

and F AB, was not sufficient evidence.