Lawsuit Accusing Bank of Captive Reinsurance Scheme Reaches Settlement

PHILADELPHIA — The parties in a lawsuit accusing PNC Financial Services of violating the Real Estate Settlement Procedures Act by engaging in a captive reinsurance scheme have reached a possible settlement, according to a recent court filing.

An April 10 notice filed in the U.S. District Court for the Eastern District of Pennsylvania says the parties “are finalizing the settlement and expect to file appropriate documentation within a reasonable period of time.”

Plaintiffs obtained residential mortgage loans from National City Mortgage. Because they made down payments of less than 20 percent, they were required to obtain mortgage insurance from a …