A few days after I filed a claim with my insurer, I was contacted by Geico asking me for information about the accident. This was probably due to the other driver filing a claim. I didn’t understand at the time, but Geico had basically initiated their own claims process for me. So now there were two claims for the same accident: one through my insurer and one through Geico. The damage estimate by the auto-body shop that works with my company was about $2000. Geico had done their own estimate, which was done by me taking photos of the damage and sending them the photos. Their estimate was about $800. The reason for the discrepancy was because Geico’s estimate only accounted for replacement of the bumper cover, and not the entire bumper. I should mention that the entire right side of the bumper was destroyed, and the backup camera was not working. The final cost to replace the bumper was about $2500, more than three times Geico’s estimate. There was also the issue of the rental vehicle which Geico had authorized for two days instead of the week the auto-body shop needed.

Once Geico’s estimate was complete, I immediately started receiving texts and emails telling me I needed to accept the $800. I was pretty upset at this point. I contacted the Maryland Insurance Administration. After going back and forth with both insurance companies, the auto-body shop, and the MIA, I finally realized that there were two separate claims processes. According to what I was told by the MIA, Geico’s initial estimate would be revised once the car was in the shop. The shop would have to send a supplemental damages form to Geico to cover the remainder, and this is all part of the process. Why Geico wanted to send me a check still doesn’t make any sense to me. I would think they should deal with the auto shop directly. By this time, Geico had already mailed me a check, which I never accepted. Since I was going through my own insurance company anyway, I told them to cancel the check.

While this was going on I had left Geico a message telling them I wanted them to cover diminished value. Maryland is a diminished value state, meaning that insurance is required to pay for the loss of value to your vehicle. When you go to sell your car, the dealer will get a report from the VIN number that will have any accidents listed. Accidents, even if the car has been fully repaired, will make your car worth less. Insurance companies don’t tell you this of course. You have to know to ask.

I didn’t actually care about diminished value. I wanted my car fixed without having to fight over it. I was trying to use diminished value as tool to make the insurance company behave. Someone left me a voicemail about it. After my vehicle was repaired, I called back and left a voicemail. It wouldn’t hurt to look into it. Due to the crazy car market right now, my car’s value was estimated at around $10000 even though it’s 9 years old. I figured the accident probably knocked off something like $1000 in value. Sure enough, they got back to me with the following:

In reviewing a diminished value claim, we consider a number of factors and review each claim based on its own individual merits. The damage in this accident was minor and non-structural in nature, which should have been repaired back to pre-accident condition.

Based on the factors outlined above, and lack of supporting documents to show a diminished value, we are not moving forward with the claim at this time. We expect that this will satisfy the requested information, however if you have any additional questions, feel free to contact our team directly.

Essentially what they are saying is, you will have to sue us to get diminished value. Damages of $2500, which would be more than half the value of my vehicle in a normal car market, are not minor. I strongly suspect that they send this letter or one very similar to everyone or nearly everyone regardless of circumstances. The cost to get an appraisal is several hundred dollars. Once you throw in court costs, it’s unlikely I would get very much, and I could even end up with a loss. The only way it would make sense to purse this would be if I had a relatively new luxury vehicle. They know that, and that’s why they put the onus on me to sue them.

I walked away from this accident without a scratch. My vehicle was repaired, though the lack of communication put me through some grief. In this case, I decided it’s best to let it go. Even though I briefly considered selling my car, it would really be too much of a pain to find another one.

As you are aware, Universal and Allstate entered into an agreement to rollover some policies that Allstate was terminating. The process was that Universal would offer coverage to these individuals based on information from Allstate. The policy was either accepted (by sending payment) or rejected (by requesting cancellation or not sending in payment) by the insured. In Mr. [removed] case, we received payment from the mortgage Company so the policy was continued in force.

[removed] was sent a new business packet as well as the initial billing on this policy, however, both parcels were returned to us. Two weeks earlier the mortgage company contacted us to change the method of billing from Mr. [removed] to the mortgage company. We then wrote to the agent to request the correct mailing address for Mr.
[removed].

We were first advised on February 15, 2013 that that Mr. [removed] had homeowners coverage elsewhere when the mortgage company (US Bank) called to advise they sent the insured’s payment to us by mistake, and that he has had other coverage since April 30, 2012. Initially, we advised Mr. [removed] that while we cannot backdate the cancellation that far, in order to refund his premium we will need proof of coverage from his current carrier, a signed request from him to cancel the Universal policy, and a paid receipt indicating he paid the other company’s premium.

Upon reviewing this entire issue, it would appear to me that the best option is for us to flat cancel Mr. [removed] policy back to inception and refund his premium in full to his mortgage company. You may advise him that we will be doing this as soon as possible. I am however, advising Mr. [removed] of the same by copy of this letter. Should you have any questions, please contact me.

It’s been a few weeks since I was told Universal would refund my escrow at US Bank. So far there has been no action. I contacted both the the BBB and the Consumer Financial Protection Bureau. I also contacted the North Carolina Department of Insurance.

I initially submitted a fraud complaint to the NCDOI but didn’t get a response. So I sent an email and was called by a person who gave me a lot of useful information. But he said this would be a consumer complaint instead of fraud. He essentially said that usually individuals commit fraud; companies just make errors. Under that definition, it sure makes it difficult to prove a company had malicious intent. But I didn’t argue. He told me to resubmit the complaint to the consumer division, which I have done.

In the mean time, I contacted US Bank and Universal again. This time I was told by a representative at Universal that a check would be sent tomorrow. We’ll see.

I also just received a response from US Bank to the CFPB. The following was OCR’d from the PDF file.

U.S. Bank Home Mortgage is in receipt of your letter to the Better Business Bureau dated February 22, and to the Consumer Financial Protection Bureau, dated March 1, regarding the servicing of your mortgage loan. I have been asked to provide you with a response, as your concerns involve my direct business line.

Please be assured the concerns which led you to submit your communication were reviewed and addressed with the appropriate response team in U.S. Bank Home Mortgage.

The response team determined U.S. Bank Home Mortgage purchased your loan on December 26, 2010 from Nasa Federal Credit Union. A notice of renewal was received on April 25, 2010 from Universal North America which was a continuation of your existing Allstate policy; the insurance carrier we had on file at the time your loan was purchased. Letters were mailed to you by Universal advising if you would like to discontinue coverage with them to contact them as soon as possible.

U.S. Bank Home Mortgage received new policy information on April 25, 2012 reflecting State Farm as your new insurance carrier. At this time, your account was updated to reflect the new policy information effective from April 30, 2012 to April 30, 2013. The yearly premium amount was updated to $405.00.

On May 10, 2012 a cancellation notice was received from Universal advising if payment was not received insurance coverage would cease on May 20, 2012. We contacted Universal and spoke with Donna, who confirmed the premium of $604.00 was due. This was disbursed from escrow and mailed on May 10, 2012.

During our research, we determined an error occurred when the renewal notification was received from Universal. On April 25, 2012, we should have placed a call to your State Farm Agent to confirm the status of the current policy on record; however, this did not occur.

We received a phone call from you on January 28, 2013 advising us the only policy that should be listed on your account is through State Farm Insurance. At this time, research was initiated in regards to the active policy on your account. On February 4, 2013, we contacted State Farm and confirmed your policy information. The premium amount of $403.00 had been disbursed April 25,2012, with coverage effective dates of April 30, 2012 through April 30, 2013. Please be advised,there was no lapse in coverage during the transition from Universal to State Farm.

On February 4, 2013, the Universal policy was removed from your account and we spoke with Jeremy who advised in order for Universal to issue a refund to you, they will need a signed cancellation request. We have submitted the required declaration page and a copy of the paid receipt;however, you will need to send in a signed cancellation request. You may email your information to underwriting@UIHNA.com or fax 817-348-7961. A refund for the premium will be sent directly to you, as we do not receive refunds from insurance companies.

Once the refund is received, you may send the funds back to us to be placed into your escrow account. Currently, there is a shortage of $598.78 on your account. Beginning with the April payment, $49.90 will be added to your monthly payment in order to collect for the shortage. By sending in the refund at your earliest convenience, the shortage will be paid in full. This will eliminate the increase in your monthly payment amount.

We regret any inconvenience or frustration the hazard policy error may have caused. We place the highest priority on providing excellent customer service and relating back to our customers in a timely manner. We wish to assure you this is an exception and does not indicate the quality of service provided by U.S. Bank Home Mortgage.

Please be assured that we truly value you as a U.S. Bank Home Mortgage customer and we consider it a privilege to serve your mortgage needs. Should you have any further questions or concerns regarding this matter, please feel free to contact our Customer Service Center at 800-365-7772 or by visiting our website at usbankhomemortgagecom.

My response is below.

Hello, as of this time, I have been told multiple by times by Universal North America that a check will be sent to US Bank to refund my escrow. I am still waiting. Please keep this complaint open until the escrow is refunded. I have also contacted the North Carolina Department of Insurance. The following are omissions and inaccuracies in US Bank’s analysis.

Universal North America and I are in dispute that I have a policy with them. I have written notification by Allstate that my policy was terminated April 30, 2012. I had never had any direct communication with Universal until US Bank initiated a three way phone call this past February. Any solicitations for business I may have received from Universal would have been discarded with the rest of the junk mail.

I notified US Bank that State Farm was my insurance company on April 23, 2012. I informed them, again, that my insurance company was State Farm, and not Universal, on April 30, 2012. I also called to make absolutely sure they understood that Universal was not my insurance company. You can see from the attached email on April 30, 2012, that a representative of US Bank acknowledged the phone call and that the issue was supposed to be fixed. This was prior to any disbursement from my escrow.

I have also sent the declaration page and receipt of payment for my State Farm insurance to Universal the day we were on the phone with US Bank. I sent the required cancellation request as well. I am still waiting for the refund to be sent to US Bank.

And here is the email thread.

[From US Bank]

Thank you for your recent request regarding your mortgage loan with U.S. Bank Home Mortgage. It is always a pleasure to assist you with any request you may have.

Our Insurance Department is in the process of updating your account to State Farm and disbursing the premium. The premium should be sent to State Farm in a few days.

If we may be of further assistance or if you have any further questions, please contact our Customer Service Center by dialing 1-800-365-7772 or you may send an email through our website atusbankhomemortgage.com and select “CONTACT US” to email a U.S. Bank Home Mortgage Specialist.”

04/23/2012 06:04 PM

[From me]

Created: Apr 23, 2012

Comments: Hello, My insurance has recently changed to State Farm. You should have received notice from State Farm, but the escrow information shows the insurance company as AllState.

[From US Bank]

Thank you for your recent request regarding your mortgage loan with U.S. Bank Home Mortgage. It is always a pleasure to assist you with any request you may have.
Your account reflects you have spoken with a representative regarding your below inquiry. However, please respond to this email if you need any further assistance.

If we may be of further assistance or if you have any further questions, please contact our Customer Service Center by dialing 1-800-365-7772 or you may send an email through our website atusbankhomemortgage.com and select “CONTACT US” to email a U.S. Bank Home Mortgage Specialist.”

04/30/2012 11:52 AM

[From me]

Created: Apr 30, 2012

Comments: Hello, Have you paid my insurance? It is due today (April 30). The escrow still shows UNIVERSAL NORTH and State Farm as my insurance companies. State Farm is the only company with whom I have an agreement. Please call me [number removed].

After I sent the response, I got the following from the CFPB.

We regret that the company’s response did not fully address the issues in your complaint, and have noted your dispute in our records. While we’re likely done working on your individual complaint, here’s what’s next:

We’ve sent a copy of your complaint to the Federal Trade Commission, where they’ve added it to a database for state and federal law enforcement agencies.
The information you shared with us will inform our work to supervise companies, enforce federal consumer financial laws, and write better rules and regulations..
Details about your complaint are available at https://help.consumerfinance.gov/app/account/complaints/list..
We welcome feedback on how our complaint process has worked for you. If you would like to share your story, go to https://help.consumerfinance.gov/app/tellyourstory.

It seems to me that the regulatory agencies are just too weak. I’ve contacted the OCC, the NCUA, the CFPB, and now the NCDOI about a number of different issues. Except for the NCDOI, from whom I have not yet received a response, the most I’ve ever gotten out of a regulatory agency is that they asked the offending company to send their side of the story. Then nothing happens. Nothing happens. There’s a response (we didn’t do anything wrong), and then nothing. We don’t need 50 regulatory agencies. We just need one with some teeth.

Before my State Farm policies were activated, I logged into my U.S. Bank (from now on, USB) mortgage account to update my insurance information. I was surprised to find that both Universal and State Farm had somehow found their way into USB’s system under my accounts. I deleted Universal from one property, but I was not able to remove them from the other. I emailed USB to inform them of the problem. Then I called just to make sure. They told me Universal would be removed from my account.

Either I failed to verify that Universal was removed from my account, or I did check, but they were later added back onto my account. In January of this year, I received notice from USB that my escrow was short by over $800. This didn’t make any sense; I should have been receiving a refund since my insurance costs had dropped. They were kind enough NOT to send an escrow statement. So I went back online to figure out what happened. Sure enough, I had been charged $604.00 the previous May for insurance I didn’t have from an insurance company with whom I’ve never done business.

Before I step into the juicy details of how it gets even better, I want to take a brief break from the story to discuss the absurdity of what has happened here. Go all the way back to the beginning. Allstate drops my policy (and many others). My information is handed over to another company that solicits me to purchase an even more expensive policy in a location were there are plenty of less expensive options. Was this a service by Allstate to ease the burden of finding another insurance company? Or should I interpret it another way? Did money flow backwards from Universal to Allstate to pick off a few new customers? It certainly seems as if it was merely assumed that all the customers whose policies were dropped would gladly accept the new, more expensive, policy to avoid having to spend a few hours finding a new insurance company.

Then I was billed for insurance I didn’t ask for. The only problem was that it was sent to my bank, a willing, albeit gullible, co-conspirator. Had the bill only come to me, I would have tossed it out — end of story. But the insurance company was clever to send the bill where they knew it had a good chance of being paid. Again, was this for my benefit? Did they really believe I wanted the insurance? Or was it an attempt to extract money from me, while hoping I didn’t notice?

Then my bank sent the money! I had no obligation even to inform them that their system was wrong. They had a fiduciary duty to protect my escrow. If there was ever any question as to how the funds were to be spent, they should have asked me before sending out the check. And there were definitely questions. Why would I want two homeowners insurance policies with similar coverage? Even if I did have two policies, why would I want the second one to be escrowed? But more importantly, I warned them before any money was laid out, and they went ahead and misappropriated the money anyway.

Why am I even required to have an escrow in the first place? It should be optional. In theory, it guarantees my insurance and property taxes will be paid, thus protecting the bank’s investment. But I don’t want to lose my house any more than the bank wants to foreclose it. I’m going to pay my taxes. I might be willing to take a risk with insurance (I wouldn’t), but the bank could easily make sure that I pay my bills. And besides that, my credit history is immaculate. The bank does not trust me, although I am trustworthy. The bank requires that I trust it with my money, although it is incompetent.

The entire system is automated. It seems as if it is so by design, not to streamline the process, but to ensure that money is easily extracted from my account and such that it can never re-enter (as we’ll see soon). I am but an unwilling participant in the scheme. If I object, or attempt to interfere in any way, I am shutdown. It is difficult to accept that an unlikely sequence of accidents led to what looks like fraud. On the other hand, it seems unlikely that all these different parties were cooperating and all had malicious intent. Perhaps it was some combination of maliciousness and incompetence. The design is such that I can never know what is intent and what is incompetence. It is a bit of genius. Errors occur frequently. The process is entirely beyond my causal influence. When an error does occur, it can almost never be in my favor (i.e. money comes out of my account in some manner). And because it’s mostly automated, it always appears to be a simple mistake (which usually goes unnoticed).

That aside, I am still trying to get my escrow refunded. I told USB I wanted my escrow fixed and a corrected escrow statement mailed. After a few weeks, I never got an escrow statement, so I called again. They had removed Universal from the system, but the escrow was not corrected. There may have been some confusion on this point because I didn’t explicitly say I wanted the escrow to be refunded. But as I spelled out in detail how the problem needed to be corrected, the bank representative refused. She insisted that the bank can’t talk directly to the insurance company (even though they were in USB’s system). She wanted me to call the insurance company and ask for a refund. I tried to explain that I had no relationship with Universal and that asking some random company for money was unlikely to succeed. Given how badly the bank screwed up, the only response to me should have been “Yes sir, we’ll fix this. Have a nice day.” Instead, I was told I need to fix their problem.

Eventually, I was able to get a manager on the phone. She called Universal and we had a three way conversation. Universal wanted me to send them a written letter and proof that I was insured by another company during this time period. Lots more time and effort on my part so they can return the money that was stolen. It’s like having your house robbed, and upon showing the video evidence of the perpetrator to the police, they demand proof that you even owned the stolen goods. But I agreed to this solution because I’m a practical person, and I just wanted the money returned.

So I sent Universal what they asked for. Now they’re telling me they can’t find a record of the check. I explain to them that I didn’t send the check. They need to talk to USB. But they refuse. So I try to get USB to send them the check number. The money is taken so easily following an unlikely sequence of unfortunate events, but try to get it refunded and all of a sudden a series of firewalls of increasing effectiveness prevents the process from moving forward.

This is where I currently stand. I’m waiting to see if Universal and USB can work this out as they said they would. I’ve threatened to contact the Consumer Protection Financial Bureau and the North Carolina Department of Insurance if they don’t refund my account soon.

The system has been craftily architected to pull money from your account. When the system is functioning properly, money comes out of your account. When the system breaks down, money comes out of your account. Then nowhere exists the competence to return the stolen funds. Is it theft if it was an accident and nobody can fix it? So odd that the extraction process is ruthlessly efficient and the refund process, utterly inept. Nobody will ever tell you that money was accidentally taken from your account. The system just keeps on churning. If you weren’t paying attention, your account is slowly drained over time as errors build. If you were watching carefully, then you have to put up a time and resource intensive fight if there is any chance the booty is to be returned.