For the last 7 years, I worked in the Insurance/Mortgage industry for a company called Balboa Insurance. Many of you do not know who Balboa Insurance Group (soon to be rebranded as QBE First by Australian Reinsurance Company QBE according to internal communication sent to all Balboa associates) is, but if you’ve ever had a loan for an automobile, farm equipment, mobile home, or residential or commercial property, we knew you. In fact, we probably charged you money…a lot of money…for insurance you didn’t even need.

Balboa Insurance Group, and it’s largest competitor, the market leader Assurant, is in the business of insurance tracking and Force Placed Insurance (aka Lender Placed Insurance, FOH, LPI, etc). What this means is that when you sign your name on the dotted line for your loan, the lienholder has certain insurance requirements that must be met for the life of the lien. Your lender (including, amongst others, GMAC, Aurora Loan Services [a subsidiary of Lehman Bros Holdings], IndyMac Federal Bank [a subsidiary of OneWest Bank], Saxon, HSBC, PennyMac [a collection agency started by former Countrywide Home Loans executive Stan Kurland after CHL and Balboa were sold to BAC], Downey Savings and Loans, Financial Freedom, Select Portfolio Services, Wells Fargo/Wachovia, and the now former owners of Balboa Insurance themselves…Bank of America) then outsources the tracking of your loan with them to a company like Balboa Insurance.

Balboa makes some money by charging these companies to track your insurance (the payment of which is factored into your loan). If you do not meet the minimum insurance requirements set by your lienholder, Balboa Insurance places a force placed insurance policy on your loan. You are sent a letter telling you that you do not have insurance, and your escrow account is then adjusted for the inflated premium of a full coverage policy placed by Balboa’s insurance tracking group, run by Steven Ramsthel, Sr Vice President of Loan Tracking Operations & Customer Care at Balboa Insurance Group, as seen on his LinkedIn profile below:

Steve Ramsthel Insurance Services LinkedIn

Steve Ramsthel Insurance Services LinkedIn

Hotwire US

How is Balboa able to charge such inflated premiums and get away with it?

It’s all very simple.

First, when you call in to customer service, for say, GMAC, you’re not actually speaking to a GMAC employee. You’re actually speaking to a Bank of America associate working for Balboa Insurance who is required by their business to business contract with GMAC to state that they are, in fact, an employee of GMAC. The reasoning is that if you do not realize you’re speaking to a Bank of America/Balboa Insurance employee, you have no reason to question the validity of the information you are receiving from them. If you call your insurance agent and ask them for the lienholder information for your GMAC/Wells Fargo/etc lien (home or auto) you will be provided with their name, but the mailing address will be a PO Box at one of Balboa’s 3 main tracking locations (Moon Township/Coreaopolis, PA, Dallas/Ft Worth, TX, or Phoenix/Chandler, AZ)

Now let’s say for arguments sake, you live in the state of Florida, in which wind insurance is mandatory, due to the high incidence of hurricanes. In addition, let’s say you live in a zone that the FEMA-managed National Flood Insurance Program has determined to be a mandatory flood zone (meaning you must carry flood insurance as well). No matter where you live in the United States, your property has been designated in a specific 3 character flood zone. If your flood zone (which can be verified by entering your property address at http://www.fema.gov) begins with an A or V, you are required to carry flood insurance. You now have 3 separate insurance policies you are required to have at all times throughout the life of your lien with your bank.

If Balboa Insurance determines, by their insurance tracking systems, that you have allowed a lapse of any kind in any of these 3 insurance policies, they issue you a policy through one of their insurance agencies (including Newport Insurance, Meritplan Insurance, and Balboa Insurance, amongst others) to cover all 3, regardless if you still have valid insurance on the other 2. You are now being double charged for coverage you do not need, despite Balboa, GMAC, and Bank of America all knowing you do not need the full coverage. What’s worse is if you’re charged for full coverage against all hazards regardless of whether or not it is mandatory for your loan.

Starbucks

How is this possible?

Balboa Insurance does not calculate their premiums for force placed insurance the same way they do for a voluntary policy. Instead your premium is based on either the principle balance of your loan (the amount you owe) or the replacement cost (the value of your home), whichever is higher. By definition, you are being forced to pay for insurance you don’t need. If this is starting to sound like Enron to you, then you are starting to get the point.

How do I know this?

Until January 5, 2011, I worked for Bank of America in the Insurance Tracking division, under Steve Ramsthel at the Chandler, AZ campus. My job as an Operations Team Manager (later demoted to an unofficial Insurance Consultant due to my ability to find illogical conditions in the system and bring them to management’s attention), was to track the insurance trackers. I built all of the databases and spreadsheets used to track the amount of loans we tracked, premiums we charged, etc across all lenders. I wrote the procedure manuals. I edited the processes utilized by their associates. I designed the training material. In short, I was the wizard’s assistant, and as such, I sat behind the velvet curtain assisting in operating the mechanics behind the illusion of Oz.

On December 22, 2010, I was contacted by a Bank of America executive in Irvine, CA named John Androwzski and offered a job as a corporate auditor. In following BAC’s corporate policy, I informed my direct managers DaleAnn States and Rhonda Meyers of my intention to apply for this position. I was then placed on a written warning for a non-existent attendance policy and demoted to a data entry processor under Peggy Johnson.

Surely Bank of America’s Human Resources department would not allow such an unethical and illegal (as determined by the Arizona Department of Economic Security and the Federal Equal Employment Opportunity Commission in my cases with them) demotion. Let’s take a look at some of the email excerpts when I brought my issues to the attention of Janel Stewart, the Assistant Vice President of Bank of America’s Advice and Counsel (BAC’s centralized personnel and human resources department):

Steve Ramsthel Insurance Tracking
Manduka Large Horizontal #1 - EU
It would appear I was incorrect. In fact, not only were my pleas for equal and ethical treatment ignored, but on Wednesday, January 5, 2011 (3 days prior to the assassination attempt on Rep Gabrielle Giffords an hour down the highway in Tucson, AZ), Bank of America’s corporate security filed case # 11-001586 against me with the Chandler PD claiming that I submitted a bomb threat, utilizing as evidence a comic strip I posted to my Facebook page (http://www.facebook.com/profile.php?id=644596162) on September 17, 2009 (per Facebook’s timestamp). On that day, over 500 Bank of America associates working at the BAC campus at 2505-2555 W Chandler Blvd, Chandler, AZ 85224, were shown the following picture of me from my Facebook page, and released into the Chandler mall area across the street mere hours before a shooting rampage (http://www.azcentral.com/photo/Community/Chandler/17541):

Brian Penny Steve Ramsthel Balboa Insurance

They were told not to speak to me as I am a military-trained bombing suspect, in an attempt to use my family’s multi-generational military tradition spanning all branches of service back to the Korean War (and including every major war since) against me. Managers held meetings across the company asking them to submit any written conversations they have had with me, quoting the Patriot Act as justification.

Because of this, I am now unemployable in the mortgage industry I have worked for my entire adult life. Although I was not arrested after questioning (a side effect of being completely innocent), I now have a police record. Many of my personal relationships were strained and cut because of this. People don’t like to have terrorist suspects amongst their friends. Getting on a flight is difficult enough already.

Three days later, the tragedy in Tucson occurred, and I watched in horror as Jared Loughner was described by the media almost exactly how Bank of America’s corporate security described me to the police and to their employees without just cause. Instead of listening to logic and making my page private, I decided to convert it into a shrine to preserve evidence, even starting a post for all of my friends and former colleagues at Bank of America to express their feelings about the incident. What the corporation didn’t count on was how friendly and personable I have always been to those I work with:

Facebook Brian Penny Steve Ramsthel Insurance Tracking

So what was the point of defaming me and attempting to have me falsely imprisoned? What were they trying to hide? What information could I possibly have that this company does not want made public?

The above information alone should be enough, but that is far from the end of the story, because having back end access to all of BAC’s systems, share drives, etc gave me quite the perspective on their business dealings.

The below email trail is one such example of the fraud I have witnessed at Bank of America and Balboa Insurance (although it is far from the only incident). What makes the below email trail so powerful is the timeframe in which it occurred, a time when Federal auditors were investigating Bank of America’s (and 14 other banks, including those listed above) foreclosure procedures, as reported in the Wall Street Journal (http://online.wsj.com/article/SB20001424052748703883504576186981894402142.html) and Financial Times (http://www.ft.com/cms/s/0/222d7066-4aad-11e0-82ab-00144feab49a.html#axzz1GGr7V3Fm).

Apple iTunes

In upcoming articles, I will go into more detail on the below email trail (explaining terminology, etc), which is currently being researched by lawyers at the Wall Street Journal for publication, but for now, please enjoy a sneak peak at the first official crack in the Bank of America armor, proving beyond the shadow of doubt, the fraudulent business practices they follow in order to charge more money to you, the consumer. I am not Anonymous. My name is Brian Penny. I am a former employee of Bank of America, but above all, I am a proud American citizen, and I will not be bullied by anyone, no matter how rich or powerful they think they are. Knowledge is power, and over the next few weeks, I fully intend to pass my years of knowledge and experience on to you, the consumer so that you do not have to suffer like I have.

To be continued…
—– Forwarded Message —-
From: “Vaughn, Jason – 2″
To: “Johnson, Peggy – 2″
Sent: Tue, November 2, 2010 9:18:18 AM
Subject: FW: GMAC DTN’s for Image Removal – Urgent Request
Hi Peggy,

I’m just a little concerned about the impact this has on the department and company. Why are we removing all record of this error? We have told Denise Cahen, and there is always going to be the paper trail when one of these sent documents come back, this to me, seems to be a huge red flag for the auditors: example: a scanned document that was mailed to us asking why the letter was received when the letter, albeit erroneous – this being the letters that went out in error – the auditor sees the erroneous letter but no SOR trail or scanned doc on the corrected letter is in the SOR and scanned in). What am I missing? This just doesn’t seem right to me.

From: Johnson, Peggy – 2
Sent: Monday, November 01, 2010 3:13 PM
To: Anderson, Joanne; Vaughn, Jason – 2
Cc: Walters, Kirsten; Smith, Jackie – 2; Mays, Therese J
Subject: RE: GMAC DTN’s for Image Removal – Urgent Request

Approved.

From: Anderson, Joanne
Sent: Monday, November 01, 2010 3:03 PM
To: Johnson, Peggy – 2; Vaughn, Jason – 2
Cc: Walters, Kirsten; Smith, Jackie – 2; Mays, Therese J
Subject: RE: GMAC DTN’s for Image Removal – Urgent Request

Hi Peggy,

The letters will not show in Rembrandt if you search by loan number. If you search by DTN, you will find the document, but it will not be matched to any loan.

Thanks,

Service Delivery information: http://sharepoint.bankofamerica.com/sites/HLandIT/default.aspx
Joanne Anderson
Balboa Insurance Group
Cnslt – Bus Tech Anly
IT LPP/CPI/TRACKSOURCE

600 Lindbergh Drive
Mail Stop: PA4-934-01-03
Moon Township, PA 15108
Joanne.Anderson@Balboainsurance.com

412-424-1287 Office

This communication from Balboa Insurance Group – may contain privileged and/or confidential information. It is intended solely for the use of the addressee. If you are not the intended recipient, you are strictly prohibited from disclosing, copying, distributing or using any of this information. If you receive this communication in error, please contact the sender immediately and destroy the material in its entirety, whether electronic or hard copy. This communication may contain nonpublic personal information about consumers subject to the restrictions of the Gramm-Leach-Bliley Act. You may not directly or indirectly reuse or re-disclose such information for any purpose other than to provide the services for which you are receiving the information.

From: Johnson, Peggy – 2
Sent: Monday, November 01, 2010 5:53 PM
To: Anderson, Joanne; Vaughn, Jason – 2
Cc: Walters, Kirsten; Smith, Jackie – 2; Mays, Therese J
Subject: RE: GMAC DTN’s for Image Removal – Urgent Request

Hi Joanne,
Where will these letters show up then?

From: Anderson, Joanne
Sent: Monday, November 01, 2010 2:28 PM
To: Vaughn, Jason – 2
Cc: Johnson, Peggy – 2; Walters, Kirsten; Smith, Jackie – 2; Mays, Therese J
Subject: RE: GMAC DTN’s for Image Removal – Urgent Request

Hi Jason, Peggy and Kirsten,

I have spoken with my developer and she stated that we cannot remove the DTN’s from Rembrandt, but she can remove the loan numbers, so the documents will not show as matched to those loans.

I will need upper management approval from Jason, Peggy and Kirsten, since this is an usual request, before we move forward.

Thank you,

Service Delivery information: http://sharepoint.bankofamerica.com/sites/HLandIT/default.aspx
Joanne Anderson
Balboa Insurance Group
Cnslt – Bus Tech Anly
IT LPP/CPI/TRACKSOURCE

600 Lindbergh Drive
Mail Stop: PA4-934-01-03
Moon Township, PA 15108
Joanne.Anderson@Balboainsurance.com

412-424-1287 Office

This communication from Balboa Insurance Group – may contain privileged and/or confidential information. It is intended solely for the use of the addressee. If you are not the intended recipient, you are strictly prohibited from disclosing, copying, distributing or using any of this information. If you receive this communication in error, please contact the sender immediately and destroy the material in its entirety, whether electronic or hard copy. This communication may contain nonpublic personal information about consumers subject to the restrictions of the Gramm-Leach-Bliley Act. You may not directly or indirectly reuse or re-disclose such information for any purpose other than to provide the services for which you are receiving the information.

From: Vaughn, Jason – 2
Sent: Monday, November 01, 2010 2:09 PM
To: Bennett, Pearl H
Cc: Johnson, Peggy – 2; Walters, Kirsten; Smith, Jackie – 2
Subject: GMAC DTN’s for Image Removal – Urgent Request
Importance: High

Hello,

The following GMAC DTN’s need have the images removed from Tracksource/Rembrandt.

354499768
354499769
354499770
354499771
354499772
354499773
354499774
354499775
354499776
354499777
354499734
354499735
354499736
354499739
354499740
354499741
354499742
354499745
354499746
354499747
354499750
354499751
354499754
354499725
354499726
354499727
354499728
354499729
354499730
354499731
354499732
354499733
354499718
354499719
354499720
354499721
354499722
354499723
354499724
354499707
354499708
354499710
354499711
354499713
354499714
354499715
354499697
354499698
354499699
354499700
354499702
354499704
354499705
354499706
354499667
354499668
354499669
354499670
354499671
354499672
354499673
354499674
354499675
354499676
354499677
354499678
354499679
354499680
354499681
354499682
354499683
354499686
354499687
354499688
354499691
354499692
354499693
354499694
354499695
354499696

Jason D Vaughn

Operations Team Manager
Balboa Insurance
AZ LPP Balboa Tracking Ops

480-755-2701 Office
92-548-2701 Internal
2505 W Chandler BLVD, BLDG D
Chandler, AZ 85224
Mailstop: AZ 805-01-36

This communication from Balboa Insurance Group-may contain privileged and/or confidential information. It is intended solely for the use of the addressee. If you are not the intended recipient, you are strictly prohibited from disclosing, copying, distributing or using any of this information. If you receive this communication in error, please contact the sender immediately and destroy the material in its entirety, whether electronic or hard copy. This communication may contain nonpublic personal information about consumers subject to the restrictions of the Gramm-Leach-Bliley Act. You may not directly or indirectly reuse or re-disclose such information for any purpose other than to provide the services for which you are receiving the information.

Check out more of my work on my new blog

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21 Responses to Bank of America: A Peak Behind The Curtain of Corruption, Part 1

  1. Interesting ~ this is three days prior to BlackMonday
    SpotBanks.com

    • Anonymous says:

      Yup. What, you didn’t realize that this was a concentrated effort to get the media to latch onto the story? It is rather doubtful that anything would grab the 4th estate and their constituents’ attention better than the drama theatre created. Society of the Spectacle, man…learn the game.

  2. Pingback: OperationLeakS | Ex-Bank of America Employee Can Prove Mortgage Fraud Part 1

  3. Nye Lavalle says:

    Many thanks and God Bless! Your courage is understandable and you can trail Balboa’s fraudulent force placed insurance scam back to the S&L days and Savings of America and Home Savings of America’s relationship and partnership with the company in order to cook its books. Check out this report I wrote in 1999/2000 and researched from 1992 to 2000. You’ll see the forced place issue paramount. SOA/WAMU & EMC/Bear spent over $2 million to try and silence me via their attacks. Hit me up with an email and we shall assist you in any way we can!

    http://livinglies.files.wordpress.com/2008/05/bear-stearns-story.pdf

    • Robert Slack says:

      I believe it. I worked for National City Bank of Pittsburgh. Came across several errors
      in savings deposit interest calculation which were in favor of the bank. Reported those
      to the main office and they were corrected. However, ….all other savings accounts were
      left uncorrected. Interest calculation would have been across the board for all accounts
      using the same factor. What about honesty in corporations today and yesterday. Government agencies must be staffed to adequately audit the banks and all other corporations. We cannot trust our bank. Just look at the recent deep recession that almost broke the back of our country. Thank goodness for President Obama.

    • dan mulcahy says:

      please contact me. i have a recorded message about something that happened in 2003-04 concerning mising files balboa was to pay on homeowners loans, i need to get this out there it may help many of homeowners in foreclosure contact me at advocatehelp4u@aol.com

      • Hi Dan,
        I wouldn’t be able to assist you with that info as I do not have the ability to verify its accuracy. You can post whatever information you have to the forums at bankofamericasuck.com so that Anonymous can review it and advise you from there. Otherwise, I would recommend contacting the attorneys involved in the various class action lawsuits concerning force-placed insurance. Those are the most efficient ways of helping homeowners. Good luck!

      • dan mulcahy says:

        thanks yeah i have been doing that, it seems that these attorneys just dont get it. This is a little know fact no one has heard of this because they dont know its going on,everytime i tell them about this they only know that what a server is and who is supposed to be taking care of the mortgage , Iam sure that if people knew this they would flip out i did, and in my case since i found out they lost the files and blamed me ” HOLY SHIT BATMAN” thats why i call it the dirty little secret.

      • The Department of Finance and several other regulators have current investigations specifically regarding Force Placed Insurance. In addition, there’s nearly a dozen ongoing civil class actions specific to the subject. These experts will know EXACTLY what you’re talking about and can assist you.

  4. Pingback: Hacker group Anonymous releases ‘Bank of America emails’ | Philip Brennan

  5. Thank you for your courage.

    Millions across America have been rendered homeless by the foreclosure fraud crisis. Foreclosure fraud is immoral, unethical, & illegal.

    We know well the “manufactured foreclosures”, many due to scam force placed insurance. VERY COMMON STORY! On the state & federal levels, the three branches of American government, the law enforcement agencies, and the regulatory agencies all appear to be captured by the financial & corporate sector to the great peril of people.

    Please consider joining ForeclosureHamlet.org. You will not the first whistleblower we’ve had join us. We know what it is like to try to fight righteously against the powerful, well-connected banking conglomerate. While you may feel alone, there are many who will instantly understand and empathize.

    Lisa

  6. Wendy in Calif says:

    Thank you so very much. It was amazing to me to watch Good Men Do Nothing. Thank God you’ve come forward and given us hope. I am so happy that the cover will be blown off, then we can get back to normal, relatively speaking that is.

  7. Pingback: Customer Privacy Violations at Bank of America/Balboa Insurance « Livinglies's Weblog

  8. Gary H says:

    I’m looking forward to Part 2, thank you so very much for speaking out from the inside!

  9. Pingback: Anon leaks « from the moon and beyond

  10. Pingback: Hacker group Anonymous releases ‘Bank of America emails’ | Philip Brennan

  11. I love reading through an article that will make men and women think. Also, many thanks for permitting me to comment!

  12. Oh my goodness! Awesome article dude! Thank you, However I am going through issues with your RSS. I don’t understand the reason why I can’t subscribe to it. Is there anybody having the same RSS issues? Anyone who knows the answer can you kindly respond? Thanks!!

  13. Pretty! This has been an extremely wonderful article. Thanks for providing this info.

  14. The next time I read a blog, I hope that it won’t disappoint me as much as this one. I mean, I know it was my choice to read through, nonetheless I truly thought you would probably have something interesting to say. All I hear is a bunch of moaning about something that you could fix if you weren’t too busy looking for attention.

  15. LiveJasmin says:

    This is a topic which is close to my heart… Cheers!
    Where are your contact details though?

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