STORY FROM: Reinsurance & Arbitration
Claims in Mortgage Reinsurance Fraud Action Time-Barred, 3rd Cir. Affirms
February 24, 2016
PHILADELPHIA — Claims that a bank and its captive reinsurer violated the Real Estate Practices Settlement Act by entering into sham reinsurance agreements with primary mortgage insurers are barred by the Act’s one-year statute of limitations, a federal appeals court has ruled.
In a Feb. 19 precedential opinion, the 3rd Circuit U.S. Court of Appeals held that the statute of limitations cannot be equitably tolled because the defendants disclosed the transactions to plaintiffs, yet they failed to investigate whether the reinsurance program violated state or federal law.
The named plaintiffs, Judith Cunningham, Frederick Deimler III, and Carol Vanover, had mortgage ...
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